Home  >  Special Features
you can get e-magazine links on WhatsApp. Click here
Special Features
+ Font Resize -

Bangladesh pharma: Pandemic impact and present scenario

Mayuri Mathur
Wednesday, October 20, 2021, 08:00 Hrs  [IST]

The pharmaceutical sector is one of the most technologically developed sectors in Bangladesh. Like other developing countries, Bangladesh pharmaceutical market is largely dependent on the raw material imports and on multinational companies for meeting the diverse needs of the local population.

In recent times, the local pharmaceutical companies have emerged as the game-changer by gaining the trust among the populace and are now dominating the local pharma market by satisfying nearly 95 per cent of the local medicinal demands.

Despite being a Least Developed Country (LDC), Bangladesh has successfully developed a robust pharmaceutical industry by formulating simple generic formulations which were earlier imported or manufactured by the foreign firms. Moreover, it has ascended as the second largest export earning sector and appears to have built a solid base to emerge as a potential sector in the upcoming days to support the Bangladesh economy.

At present, the pharmaceutical sector has 257 licensed players, among which, 150 are functional. Many local manufacturers are meeting the international standards and are exporting their products to 151 countries while a few companies have left giant footprints in the US and UK markets expanding their reach each day.

The industry has been experiencing a tremendous growth in the last decade and currently is contributing almost 1.85 per cent to the country’s gross domestic product with an annual turnover of about $715 billion.

Bangladesh’s drug export is also growing at a healthy rate which contributed approximately US$ 120 million in the past years. With a historical five-year CAGR of 15.6 per cent, the sector is expected to grow to $5.11 billion by 2023.

The rise of the pharmaceutical industry in Bangladesh is attributed to the Drug Ordinance of 1982, which is an amended form of the Drug Act of 1940. As for the global market, the sector has a huge potential with patent exemption by the Agreement on Trade Related Aspect of Intellectual property Right until 2033.

Covid-19 impact on pharma industry
The global health facilities and wellness sector are under great strain in response to the Covid-19 pandemic. The sudden outbreak of the pandemic has hit the healthcare and pharmaceutical sectors of various countries while the unusual consumer behavior has intensified the crisis in the beginning stage.

The pharmaceutical supply chain has also been severely affected by Covid-19 along with the overall healthcare system and the retail pharmacy stores are facing a massive change in customer buying patterns. The drug-makers worldwide are comparatively in a better position than others as they deal with essential products.

Bangladesh, a lower middle-income nation, and one of the most heavily populated parts of the world, is also struggling to tackle the spread of this deadly disease. One of the major challenges faced by the Bangladesh pharmaceutical industry during the pandemic is in sourcing raw materials and Active Pharmaceutical Ingredients (APIs).

About 95 per cent of all APIs are imported annually from abroad, mainly from China and India.  Due to Covid-19 situation, India has banned the export of all raw materials related to Covid-19 medicine while China went into complete lockdown which, in turn, has led to the critical scarcity of the raw materials required for effective production of medicines.

The country is also witnessing unprecedented consumer behavior and their buying patterns followed by a supply chain disruption. Another stumbling block for the Bangladesh Pharma industry is the increase in the international drug prices.

However, the Bangladeshi pharmaceutical industry demonstrated its capability during the Covid outbreak and within a short period, it came forward and took various initiatives to overcome these hurdles. The local market players procured the ingredients at double the regular price to overcome the dearth of the raw material and APIs.

The pharmaceutical firms made all efforts to keep their regular operation up and running to supply essential drugs to the markets both at home and abroad. Manufacturing of anti-coronavirus drugs like Favipiravir and Remdesivir has been a tremendous achievement for the industry. Local companies showed efficiency to manufacture the generic version of the anti-coronavirus drugs, allowing people to buy them at a reasonable price across the globe.

Bangladeshi Remdesivir has also been exported to Central America, Central Asia and Africa. In addition to above, Bangladesh's pharma sector also took to boosting immune systems by manufacturing different vitamins, zinc tablets and other relevant medicine and making those widely available in the country at moderate prices.

The radically increased sales and export of hand sanitizers and face masks has also fared well for the local companies amid the ongoing coronavirus pandemic. In near future, the Covid-19 outbreak is expected to lead to higher demand of sanitizing chemicals, and other medications in the short-term, as healthcare professionals and patients alike seek prevention and basic treatment measures.

The domestic market of Bangladesh saw a handsome growth in 2020 and the industry has achieved more than 10 per cent growth in 2020. The industry clocked 17.36 per cent higher export growth during the July to November, bringing home $69.82 million. The industry had also done well in export markets and registered around 15 per cent growth.

Although the Covid-19 outbreak has thus far not had a large impact on the local pharmaceutical sector of Bangladesh, still the spread of the pandemic is expected to lead to a shortage of APIs in the near-term. The ban on API exports from India is a harbinger of hard times for the import-dependent industry of the country.

Though, in future, the industry is not expected to suffer from any potential slowdown, a government enforced lock-down might disrupt production (factory closure), distribution and marketing of the pharmaceuticals. Moreover, if Covid-19 persists, the limited supply of APIs and formulations in the international market will drive up prices of raw materials further.

On the other hand, if the Covid-19 outbreak leads to a recession or even a reduction in the economic growth of the country, pharmaceutical companies will have less room for passing on the price increases to the customers, which will eat into their profit margins. DGDA regulations will also make a price increase difficult to justify for the industry. Moreover, the dependency on imports can erode the sector’s international competitiveness and may lead to stunted growth in export.

Efforts to mitigate Covid effect
In order to alleviate the negative impacts of Covid-19, the government of Bangladesh should encourage pharmaceutical players to invest in their R&D processes to increase their capacity to ramp up production of possible vaccines and medications. In this regard, the government can enable partnerships between the WHO and private sector pharmaceutical companies to bring these vaccines to market, making use of the TRIPS exemptions that the country enjoys.

To develop more effective export strategies that yield better and sustainable results during the pandemic, the Bangladesh pharmaceutical manufacturers need to continually monitor and assess their performance in terms of sales volume, changes in product demand and sales trends for each major destination country where they have been able to put their footsteps.

Rather than continually looking for new markets, they must focus on a few selected markets and try their best to consolidate market positions in these already penetrated markets. In order to expedite pharmaceutical exports, Bangladesh needs to concentrate on building a reputed Contract Research Organization (CRO) as it is an utmost priority for quality endorsement. These will bring higher returns for their efforts and investment, improve their business efficiency, develop country specific knowledge, enrich product promotion expertise and develop competitive advantage over others which in turn will help make their learning curves steeper.

Due to the difficulty of sourcing patented APIs, especially in this pandemic phase, Bangladesh is unable to enjoy the full benefits of the absence of product patent protection. China and India are the main competitors of Bangladesh in exporting pharmaceutical products and due to their own Active Pharmaceutical Ingredient (API) production facilities they are in a more advantageous position. Certain steps have been initiated for the growth of the API sector in the country and in order to succeed, the government needs to be more directly involved in developing the technological base of the industry.

Future prospects
Bangladesh’s pharmaceutical market will continue to grow at double-digit rates over the coming years, despite of the recent deceleration due to the pandemic-induced economic crisis and high levels of out-of-pocket spending on healthcare. It is expected to have a compound annual growth rate of more than 12 per cent during the 2019-2025 period and is predicted to surpass US$ 6 billion by 2025 with an absolute growth of 114 per cent from 2019 levels.

The public health sector will remain underdeveloped in the near term while the opportunities in the private healthcare sector will continue to increase on the back of economic development and rising incomes. Meanwhile, local drug-makers will continue to grow and expand into export markets.

The share of generic drugs is expected to surpass 85 per cent by the 2025, which will further strengthen the dominance of local pharmaceutical companies in the market. In addition to this, the presence of leading multinational pharmaceutical companies is also increasing in Bangladesh, which is indicative of a competitive landscape in upcoming years.

While the country has been competing powerfully with the other emerged markets of the world digital stringency, which been a transforming source for the other markets, is on the move in Bangladesh at a very slow pace.

Technological developments and scientific advancements are necessitated to secure a significant position in the global market and combined efforts of the market players and government are mandatory to remove this hindrance.

In upcoming years, the government of Bangladesh is required to play a major role in the rapid growth of the pharmaceutical market by providing favorable policies for easy drug approval, production and marketing of new products.

Although the negligence for API manufacturing has not constrained the growth of the local firms initially due to the availability of cheap supplies from India and China but has now emerged a critical bottleneck in current times.

Government is now focusing and taking crucial steps to reduce the dependence of Bangladesh over the import of raw material. The establishment of API Park will act as a turning point for this purpose.

(The author is freelance pharma consultant)


Post Your commentsPOST YOUR COMMENT
* Name :     
* Email :    
  Website :  
Copyright © 2016 Saffron Media Pvt. Ltd |