Bangladesh pharma holds huge potential for growth

Bangladesh has grown and developed remarkably in recent years in pharmaceutical sector. The pharmaceutical industry in Bangladesh is a significant component of the economy of country. It includes a broad spectrum of pharmaceutical businesses, from big international conglomerates to tiny regional businesses.

Bangladesh’s pharmaceutical sector enjoys a substantial local market share and has seen a steady growth in export activity. The industry’s revenue and market share are steadily rising. The pharmaceutical products of Bangladesh are used to treat a wide range of illnesses, including as digestive system issues, respiratory system problems, and cardiovascular diseases.

Regarding import and export, Bangladesh’s pharmaceutical sector is expanding its ties to the global market by importing raw materials and technologies from other countries and exporting to numerous markets.

Bangladesh’s pharmaceutical sector has bright futures, lots of growth potential, and opportunity to expand, opening new paths for the nation’s employment and economic development.

Square Pharmaceuticals Ltd, Incepta Pharmaceutical Ltd, Beximco Pharmaceuticals Ltd, Opsonin Pharma Ltd, and Renata Ltd are the top five pharmaceutical manufacturers in the country. As per a report released by EBL Securities, the pharmaceutical industry has grown at an average annual rate of 15.6 per cent over the last five years, putting its present value at around BDT 275 billion.

Generics propel industry’s growth
Thanks to the WTO’s patent exemptions from the TRIPS Agreement, generic drugs have so far contributed to the industry’s growth, accounting for 80 per cent of all drugs. But, given that the plant will close in 2033, the industry could need to gradually change its composition. The competitive landscape will be interesting as pharmaceutical companies establish their unique composition strategies towards the conclusion of this decade.

By 2030, more than 40 million people—or 22.4 per cent of the population—are expected to be over 50, up from the current 17.1 per cent. Chronic illnesses and the need for pharmaceuticals will therefore increase. This group will see contemporary medicine more favourably and be more reliant on prescription medications. It will therefore be a major factor in the pharmaceutical industry’s expansion. By 2030, this industry is predicted to be worth BDT one trillion, with potential annual growth of 16 per cent.

Economic growth
The expansion of Bangladesh’s pharmaceutical sector corresponds with the country’s economic growth. The economy of the nation is among the fastest-growing in the globe. The nation’s GDP increased by 5.4 per cent and per capita income reached US$ 2,227 in the fiscal year 2020–2021.

The growth of the pharmaceutical industry was 18.6 per cent, in line with the economy. While the government projects 6.6 per cent GDP growth in FY 2022–2023, the World Bank (WB) projects 6.2 per cent growth. By FY 2025, the middle and affluent Class (MAC) population is predicted to make up 17 per cent of the overall population, up from seven per cent in FY 2015. There will inevitably be a rise in demand for medications due to growing purchasing power and fast urbanisation.

Growing animal health market
The market for animal health is currently worth BDT 30 billion. About 70 per cent of the market is occupied by regional pharmaceutical firms as Renata, Square, ACI, Acme, Opsonin, Eskayef, Navana, Popular and Incepta.

Renata commands a market share of almost five per cent in this segment. Renata’s market share is mostly driven by the BDT 350 billion poultry market in Bangladesh. The company’s main products are toxin binders, minerals, vitamins, enzymes, and antibiotics. The dairy and meat industries have suffered because of the Covid-19 pandemic.

Reports state that 40–45 per cent less chickens were produced last year than the previous year, and 40 per cent of registered poultry farms have closed. By 2026, Bangladesh will move into a middle-income country, which would result in a sharp rise in protein consumption. The demand for products related to animal health will rise because of the expansion of the cattle and poultry sectors.

Expanding outlook of supply chain
Two components which make up the pharmaceutical industry’s value chain are APIs and completed formulations. The import of APIs, the raw chemicals needed to make medications, is what the entire industry depends on from China and India. Production may be hampered by supply chain disruptions and increases in world prices.

As of 2019, just 15 local businesses were producing 41 API compounds, while Gonoshasthaya Pharmaceuticals Ltd was producing 60 per cent of the raw materials, according to an article in The Daily Star.

The government has decided to construct an API Park in Munshiganj as a remedy. By the end of 2022, production is anticipated to begin. With the implementation of the API strategy, it is hoped that 97 per cent less raw material imports would be necessary and that API export revenue will increase from US$ 1.5 million in 2016 to US$ 90 million in 2032.

However, reducing reliance on China and India for APIs would take a very long period. Plots in the API Park are now allocated to 27 companies, with ACME Laboratories and Healthcare Pharmaceuticals scheduled to begin production first.

Challenges in near future
Bangladesh would be excluded from patents on pharmaceutical items until 2033 as a least developed country, according to the TRIPS agreement with the World Trade Organisation.

Bangladesh is expected to lose the patent exemption facility seven years prior to its expiration date, though, as it hopes to graduate from the LDC by 2026. It might impact Bangladesh’s pharmaceutical industry’s growth since pharmaceutical firms would need to pass new patent laws if Bangladesh loses access to the TRIPS agreement’s benefits. The production of many kinds of generic medications will probably stop as a result.

To continue producing these medications, domestic producers could have to pay patent royalties. As a result, Bangladesh’s total medical costs could go up. If not, businesses risk infringing on patents and exports would be seriously hindered.

The lack of emphasis Bangladeshi pharmaceutical companies place on research is one of the main problems facing the nation’s pharmaceutical sector. Consequently, the indigenous pharmaceutical industry lacks innovation. Aside from this, subpar and counterfeit medications pose a danger to Bangladesh’s pharmaceutical sector.

Despite stringent regulations governing the quality of pharmaceuticals sold overseas, a substantial number of fake medications are available on the home market. Quality producers consequently lose enormous dividends annually.

Furthermore, the pharmaceutical sector would be able to become even more self-sufficient and manufacturing costs would be further minimised if most of the raw materials needed to create medications were generated domestically instead of having to be imported from abroad.

Conclusion
The pharmaceutical industry in Bangladesh is one that is developing along with the times. Bangladesh is generating significant foreign cash through exports in addition to satisfying the nation’s need for pharmaceuticals. Though it now contributes little to the GDP of the nation, the pharmaceutical business is expected to develop in the future if Bangladesh can maintain its current rate of growth. But Bangladesh must alter its policies if it is to keep its pharmaceutical industry growing.     ?