How do you produce a bankable feasibility study for a pharmaceutical manufacturing plant in Nigeria?

Feasibility study report cover

A bankable feasibility study for a Nigerian pharma plant is one a development finance institution (IFC, AfDB, PROPARCO, DEG or the EIB) can lend or invest against without re-doing the work. It must prove, with evidence, that the project is technically sound, regulatory-compliant to WHO GMP standards, commercially viable at realistic Nigerian input costs, and structured to a financing standard the DFI recognises. Below is what that requires, where most studies fail, and the benchmarks we use.

Author: Theodora Ogharanduku, CEO – Knectiv. Last reviewed: Aug 18, 2026

What “bankable” actually means to a DFI

“Bankable” is not a quality of the plant, it is a quality of the evidence. A DFI credit committee is asking one question - can we defend a decision to deploy capital here? That means your study has to survive third-party scrutiny on four fronts simultaneously - technical, regulatory, commercial and financial - and be internally consistent across all four.

A study that is strong on engineering but hand waves the offtake, or strong on market size but vague on WHO or NAFDAC compliance, is not bankable; it’s a brochure.

This matters more in Nigeria right now because the capital is actively looking. The EU’s Team Europe MAV+ initiative, launched with an initial €1 billion and backed by the European Investment Bank, was created specifically to de-risk private investment into local African pharmaceutical manufacturing (European Commission). Nigeria is a named focus country and reached WHO Maturity Level 3 for regulation in 2022 (MAV+ Nigeria factsheet).

Guarantee facilities such as the EU’s €750 million Human Development Accelerator now sit behind pharma and vaccine manufacturing on the continent (Global Gateway Forum). The money is there, the constraint is bankable projects.

The four pillars of a bankable study

1. Technical and engineering feasibility

The study must specify the manufacturing route (API synthesis, fill and finish, or both), the dosage forms, target capacity, and the plant’s utilities and cleanroom design to GMP standard. Because power, water quality and effluent handling are the binding constraints in Nigeria, these cannot be footnotes, they are core risk items.

  • Time to build and commission: 3 - 5 years. Equipment purchases and regulatory approvals can stretch lead times while construction delivery methods can compress them.
  • Indicative capex for a WHO GMP finished dose line: $25 - $50 million for a standard multi-product facility such as oral solid dosages combined with basic sterile or liquid lines. $40 - $70+ million for complex formulations, automated bioprocessing and advanced sterile lines.
  • Indicative capex for an API synthesis line: Emzor's $23+ million is Nigeria's only currentreference.
  • Utility redundancy assumptions: Power typically operates on a dual-feed philosophy or an N+1 configuration with emergency diesel generators as mandatory; standby pumps and parallel purification stages must be incorporated for water; an N+1 fan configurations or redundant supply and exhaust fans are employed for cleanrooms; duplicated compressors or multi-stage backups are in operation on HVAC systems and dual compressor setups with automatic load sharing and standby units for compressed air and processes gases.

2. Regulatory feasibility

The study must map the plant against WHO Good Manufacturing Practice requirements and, where export or donor funded procurement is the goal, the WHO pre-qualification pathway. The distinction between API and finished dose GMP obligations is absolute and should be spelled out, not assumed.

WHO GMP utilises three levels of risk to determine the level of regulatory oversight and the priority for corrective actions to categorise facilities based on the compliance of a manufacturers’ site (physical premises and equipment) as well as their Quality Management System (QMS).

Fill and finish manufacturers must satisfy NAFDACs GMP requirements for local production and WHO pre-qualification for export as mentioned above, whilst APIs must meet the International Council for Harmonisation of Technical Requirements for Pharmaceuticals for Human Use (ICH) benchmark delivered through NAFDAC.

3. Commercial and market feasibility

This is where most Nigerian pharma feasibility studies fail. A credible study proves demand at a price that clears realistic variable costs, not just headline market size. It needs a defensible offtake picture (public procurement, private distribution, export), competitor benchmarking against local producers, and honest input-cost assumptions.

A common failure point is yield loss. On some product lines, cumulative process losses inflate variable cost above the achievable selling price, making the product loss-making at “market” prices. A bankable study finds this before the DFI does.

4. Financial feasibility and structuring

A full three statement model (monthly for the first 10 years is standard), with an explicit financing structure, debt-service coverage, sensitivity tables on the commercial variables that actually move the model, and a WACC the DFI will recognise. The output the credit committee need to know is at what point, and under what assumptions, does this project cover its debt service.

  • Base-case IRR / DSCR: Leveraged IRR typically target between 15% - 22% in emerging markets. International project finance lenders typically look for a minimum structuring or average DSCR of 1.30x to 1.55x
  • Key sensitivities modelled: CAPEX overruns and construction delays, capacity utilisation and ramp-up speed, batch failure and yield rates, regulatory inspection and approval timelines, FX volatility, utility and energy cost inflation and average selling price (ASP) and tender pricing

Where most feasibility studies fail (and what fixes it)

  1. Treating infrastructure as an assumption, not a risk. In Nigeria, power and water are the business case. Model them explicitly.
  2. Market size instead of margin. Demand at an unviable price is not demand. Prove the clearing price.
  3. Regulatory hand-waving. WHO and NAFDAC compliant is not a claim; it’s a mapped, evidenced pathway.
  4. A model the DFI has to rebuild. Structure to the financier’s standard from day one.

This is precisely the gap Genesis Science Park is built to close, removing the power, water, effluent and cleanroom risk from your feasibility study so the commercial and regulatory case can stand on its own.

Removing 60–70% of the upfront cost; moving capex to opex.

Ready to pressure test your project?

If you are undertaking a feasibility study or are operational and expanding, our technical prospectus sets out how Genesis Science Park de-risks the infrastructure layer for API and finished-dose manufacturers.

→ Complete the expression of interest questionnaire and download the technical prospectus.

FAQs

Often, yes. Plenty of feasibility studies are over engineered, and length is not the same as bankability. But bankable is not about more, it is about for whom. A bankable study is written for one specific reader, a development finance credit committee, and it passes one specific test: can they lend against it without having to redo the work? A shorter study that survives that scrutiny beats a thick one that does not. The excess to cut is any detail that would not change a financing decision. The rigour to keep is anything the credit committee will independently check.

Cost is a function of scope and manufacturing purpose - a plant extraction study and a multi-step synthesis study are not the same exercise, so a single figure would be misleading. The more useful answer is that it should be phased, not front loaded. Using a recognised estimating framework such as AACE International’s classification system, you move from a low cost, low definition pre-feasibility study up to a lender grade one only as the project earns each stage. That sequencing is exactly what prevents premature overspend buying certainty in proportion to commitment, rather than commissioning a full study before the fundamentals justify it.

Because most shelved studies were built in a vacuum, to describe a project rather than to be underwritten. A study becomes finance ready instead of a document when it is structured from the outset around the criteria a specific financier screens against, and produced alongside a live capital conversation rather than before one. The test is simple - if a DFI has to rebuild your model to assess it, you have a report; if they can run their own sensitivities directly on it, you have a financing instrument.

For parts of it, yes - the market and commercial sections often benefit from in-house knowledge. Where generalists reliably fail is the pharma-specific technical, GMP and regulatory dimensions, and a credit committee can tell the difference immediately. Two things matter that cheapness works against: whether the study anticipates a GMP inspection and the DFI’s environmental and social requirements, and whether the author carries credibility the financier recognises. A study is only as bankable as its least defensible section, this is usually the one done on the cheap.

A study that offers a single confident number is the unreliable one, and it’s right to distrust it. Reliability in a volatile market does not come from precision, it comes from explicitly stress testing the variables that move the outcome. A bankable Nigerian study runs sensitivity and scenario analysis across FX, energy cost, yield and schedule, and states the point at which the business case breaks. The goal is not a forecast that proves correct but a decision that holds up across the range of futures a financier considers plausible.