Haven't found the Essay You Want?
For Only $12.90/page

Pharmaceutical Industry Analysis in Bangladesh Essay

Patent medicines are the products that are invented by the company, who have their own research team working on their own laboratories. These products are patented for many years to enjoy the monopoly market. After years of business the formulation is sold in the market so that others can go into mass production.

Generic medicines are the products that are produced in mass scale. These are marketed by several companies under different brand name, where the formulation of this product is almost same. Prices of the products are under this category are competitive. Bangladesh mainly concentrates on this category, as labor cost is one of the lowest in the world.

Growth & Trends:

The growth potential of pharmaceutical industry is enormous. As urban population is increasing and people are getting educated, they are now more concerned about healthcare. So the demands of medical products are rising. In Bangladesh unhygienic conditions and poor health maintenance plans provide vast scope for the pharmaceutical firms to sell their products. On the other hand, the constant natural disasters provide opportunities to pharmaceutical companies to boost its sales. The industry is growing the protection of national Drug Policy 1982. But after the GATT regulation, changes are bound to take place. Furthermore, the trend & growth of this industry tends to be positive as the demand of medicines is rising, which have mentioned earlier.


Particulars Number/Quantity
Total Area of Bangladesh 147,570 Sq.Km
Population more than 133.40 million
Crude Birth Rate (CBR) 19.00 (per 1000)
Crude Death Rate (CDR) 4.90 (per 1000)
Per Capita Annual Income (CAI) 470 (in US$)
Total National Export 6,889.30 million US$
Total National Import 10,903.00 million US$
Number of Countries Exported (P/ products) 62 nos.
Total Number of Registered P/Industries 235 nos.
Total Number of P/Industries in operation 154 nos.
Total Market Size 697 million US$
Percentage of Production of Local Industries 96%
Percentage of Import against local market 4%
Number of drugs produced by local P/C 450 generic items
Number of drugs controlled 117 generic items
Number of drugs decontrolled 333 generic Items
Number of drugs mostly demanded 50 generic Items
Number of Industries producing raw materials 21 companies Number of API being produced 41 Items
Drugs produced in generic Name 450 items
Drugs produced in brand Name 5,000 items
Drugs produced in strength (number ) 8,000 items
Contribution to the revenue sector 5.00 US$
Contribution to the GDP 1.25 percentage
Total Employment Creation (more than) 78,000 nos.
Number of Licensed Chemist (Drug seller) 68,000 nos.
Number of Chemist without License 52,000 nos.

Factor Endowment:
In economics a country’s factor endowment is usually understood as the amount of land, labor, capital and infrastructure that a country or industry possesses and can exploit for manufacturing. Industries with a large endowment of resources tend to be more prosperous than those with a small
endowment. The development of sound institutions to access and equitably distribute these resources, however, is necessary in order for an industry to obtain the greatest benefit from its factor endowment. Nonetheless, the new world economies inherited attractive endowments such as ideal weather condition, suitable size of the industry or skillful manpower. In case of pharmaceutical industries in Bangladesh, they have invested in land to increase their business widely within and across the country. Day by day this sector is making a random physical change to grasp the international market. All the companies in Bangladesh have enlarged their physical size with huge success. Pharmaceutical companies have also appointed a large number of skilled manpower for the betterment of this sector. A huge amount of people have been trained well to successfully operate the pharmaceutical companies around the country and outside as well. Demand:

Bangladesh is prone to tropical diseases, and this leads to a high demand for pharmaceutical goods. Because of this and the poor health and hygiene situations, a steady growth in the pharmaceutical sector is possible. Demand is positively related to the changes in disposable income. Assuming that income per capita will continue to increase, it may be predicted that the demand for pharmaceuticals will also continue to rise.

Dhaka is the largest contributor, with nearly 35% market share. Chittagong and Sylhet follow with 26% market share each. Khulna has a much smaller share of 14%, but it has an immense growth potential because of the higher value sales per chemist.

Dhaka also has the highest per capita expenditure on drugs. Studies have shown that people in urban areas tend to consume more pharmaceutical products compared to people living in rural areas.

Urbanization is steadily increasing in Bangladesh, as more and more people move in from rural areas to live in Dhaka and the other cities. Because of the increased frequency in natural disasters, people prefer to live and work in cities other than in villages. This bears a direct impact on the volume of sales of the pharmaceutical companies. As more people are living in
relatively developed areas, the demand for medicine is also rising. This provides a great opportunity for the companies to increase their sales.

Market prospects and market entry strategy

1. Macro economic environment
The overall macro economic environment is quite positive and favorable for international business. Both import and export are increasing; import is increasing since the country has moved to manufacturing sector more aggressively due to availability of skilled and cheaper labor force. In order to carry out international business smoothly, the national information infrastructure (NII) has also improved. The government has introduced liberal policy to attract for the foreign investors, business and commercial organizations. The country is experiencing slow but steady growth in the Gross Domestic Product (GDP) at 5.33%. Key indicators of gradual improvement in the economy are positive; Per capita income has increased at US$ 470 (June 2005), literacy rate has increased at 65%, average life expectancy rate has increased at 68.2 years, annual export growth is 9.39% while import grew only at 13%. Inflation rate has reduced at 5.1%. Per capita expenditure on medicine has increased at more than US$ 4.00, which is among then lowest in Asian countries, compared to developed countries. But, this indicates good potential for the growth of domestic market. The pharmaceuticals sector is a growth sector as mentioned in the earlier chapters. Future potential for this sector is also bright. Recent export performance has drawn the attention of the government. But, the pharmaceutical industry sector is heavily depended on imported raw materials. Rapid growth in the export market has created opportunity to expand production capacity. The sector can be viewed at a glance from the attached sector profile

2. Availability of marketing services
In Bangladesh, all kinds of marketing and market promotion services are availability. There are marketing companies who can take up assignment of marketing and distribution of products overall the country. A large pool of sales force has been developed over the last 22 years who can take the products to the doorstep of the end users through 120,000 retailed
Pharmacists. To organize a sales and marketing force, expert services can be taken from local source. Moreover, there are marketing and promotional agencies, distributors, indenters and stockiest. Organizations are there to import skill development training on sales, marketing and distribution. There are trade journals, news letters and trade bulletins specifically for the pharmaceuticals sector. There are a good number of event organizers who can organize trade fairs, exhibitions and other events.

3. Recommended strategy for new entrants
Following the success stories of the leading companies, several factors have been considered as critical to success and these are follows:
• Quality product through quality production system
• Skilled and trained manpower for product promotion
• New and wide range of products
• Innovative promotional techniques.
• Strong backward linkage support with or outside the country • Prompt and cost effective delivery and distribution network with depots • Attractive packing and packaging with detailed specifications • Continuous research and development for improvement of products • Sound operational plan including marketing and financial planning

In the days to come, the local market will be very competitive. A new company should be well prepared with all sorts of planning like marketing and promotion, procurement and production, distribution and delivery, sound financial management, innovative product development. A good combination of several major elements may bring success for any new entrant in this sector and these are as follows:

(a) Product characteristics
154 companies are selling common products, such tablets, capsules, syrup (liquid) etc. To attain competitive edge, new entrant should emphasis on new dosage forms like, Anti-biotic, drugs, inhaler, suppositories, needle free injection, patch injection etc. Herbal products have a large potential market.

(b) Price
Since the government strictly controls price of pharmaceutical products, a new company should adopt ‘shadow or indirect’ pricing method.

(c) Trade channel
New companies should adopt trade channels that minimize their distribution and other costs. Possibility should be explored to get institutional orders. Contract manufacturing can be one of the options since the revised policy allows it.

(d) Promotion
Since direct product promotion activities are prohibited other means should be applied. Push selling system can be an effective technique for product promotion. Besides, incentives in different forms may be given to the field level sales force, doctors and medical practitioners. Sponsoring various events like workshops, seminars on medicines and healthcare related issues and financing charitable healthcare activities can be adopted.

(e) Joint venture arrangements
Joint venture arrangement with foreign reputed pharmaceutical companies having plant for API possibly form USA, Europe-Scandinavian countries, Japan will be best option for any new entrant.

(f) Buy out and mergers
Recently, many MNCs merged. In Bangladesh, there are dormant factories which can be bought and restarted through infusing fresh funds.
Related industries of pharmaceutical companies:
Pharmaceutical industry itself is a potential one in Bangladesh. There are also some supporting sectors alongside this one in our country:

Strengths, weaknesses, opportunities and threats:
The strategic analysis on the pharmaceuticals industry of Bangladesh gives the following results: Strengths of the industry are as follows:
• 5-7 leading companies are world class
• Products acceptable in the global market as ‘Quality Products’ • Wide range
of products
• Price is competitive both in local and foreign market
• Strong brand image created by the market leaders parallel to MNCs • Large pool of efficient and qualified technical manpower at minimum cost • Supportive government policy attracting foreign investors • Do not have to comply with IPR until 2016.

• Backward linkage support is being created
• Large domestic market with reasonable growth
• Oldest and one of the largest sector in terms of capital investment Weaknesses of the industry are as follows:
• Dependency on imported raw materials or absence of API plants • Absence of international standard quality control and testing laboratory • Absence of bio-equivalence testing and clinical facilities • Inadequate knowledge on TRIPS and trade related matters

• Little research and development on new molecule development

Opportunities for the Industry are as follows:
• Large potential for export market expansion from 2006 till 2016 • Huge potential to set-up manufacturing plant for API or bulk drugs • Liberal government policy for the foreign investors for joint venture pharmaceuticals unit • Large pool of qualified technical personnel may set up manufacturing units in other LDCs • Local companies can offer technical know-how to LDCs for setting plants. • Domestic market is gradually increasing with the increase in GDP • Scope for product diversification into herbal and animal healthcare. • Research and development activities may be initiated with external support • Scope to take advantage of compulsory licensing, parallel import and bolar provisions

Threats for the industry are as follows:
• Cheaper medicine from China and India
• TRIPS may bring tough competition in the local and export market • India has amended 1970 Patents Act as favorable as possible • The sector is dependent on imported raw materials any fluctuation in raw material prices
or rate of exchange will have negative affect on competitive prices. • Entry of multinational with large scale investment with strong backward linkage support • Neighboring countries supplying products to Bangladesh through unauthorized channel. • Imported drugs will be in the local market after enactment of revised drug policy

Cultural Diversity:
Population groups that have been conventionally defined along racial and ethnic categories comprise important subgroups whose special needs and drug responses traditionally have been undervalued or ignored. The factors determining population variations in response to medications are complex and interdependent. Environmental factors (e.g., climate, smoking, alcohol consumption) may have a profound effect on drug metabolism. Biologic factors such as genetic polymorphisms (naturally occurring variations in the structures of genes, drug metabolism enzymes, receptor proteins, and other proteins involved in drug response or disease progression), age, and gender have significant influence and may require the use of alternate drugs or dosages in patients of different racial and ethnic backgrounds. Genetic research in the past few decades has uncovered significant differences among populations in the metabolism, clinical effectiveness, and side effect profiles of therapeutically important drugs. Yet cultural differences also have been documented to affect a patient’s adherence to, and therefore the effectiveness of, drug therapy. For example, trust and respect for patients and their health beliefs and practices, as well as communications issues, have been found to influence adherence to medication regimens. Patients’ beliefs about the nature of disease, acceptance of side effects, and preferences regarding herbal or traditional therapies may be influenced by a range of socio-cultural influences, including gender, socioeconomic class, education, immigrant status, and religion, all of which must be taken into account. Additionally, communications barriers may lead to incorrect interpretations of diagnoses and instructions regarding treatment. Similarly, inadequate health literacy may impact the ability to understand and follow through on health information matters.

Direct-to-Consumer Advertising
Direct-to-Consumer (DTC) Advertising is a form of marketing in which advertisements for pharmaceutical products are aimed directly at consumers, in addition to medical providers and payers. The discussion around DTC is centered on whether direct-to-consumer advertising provides value for consumers, prompts appropriate use, and whether it increases diagnosis of otherwise overlooked medical problems. To address growing concerns about DTC advertising, PhRMA approved and released voluntary guiding principles for industry to follow in developing DTC advertising. Key elements include: * Submitting all advertisements to the FDA prior to broadcast; * Transparency regarding what the advertised medication is intended to treat; * Balanced presentation of risks and benefits; and

* Educating care providers about a medicine before reaching out to consumers.

Disease Management and Medicaid Health Outcomes Management
Cost containment of pharmaceutical expenditures usually involves various efforts to control drug utilization. These efforts typically are aimed at physician providers, pharmacist providers, or the pharmaceutical industry. They have included the establishment of drug formularies and prior authorization programs. Governmental legislation has had an important role in shaping these efforts. A relatively new approach to cost containment is disease management. Disease management refers to a system of coordinated health care interventions for populations with conditions in which patient self-care efforts are significant. The goal of disease management programs is to optimize therapy. Optimizing therapy should improve outcomes and decrease overall expenditures associated with a disease.

Drawbacks of Component Management
In health care, component management is the practice of separately managing individual cost drivers, such as prescription drugs, hospital admissions and doctor visits, instead of considering the underlying health issues of patients or total mix of features in a health care plan. Through component management, health care plans try to lower overall costs by making changes specific to a cost driver. When prescription drugs are managed as a
separate component, for example, there is no consideration given to the effects of appropriate drug use on the use of other medical services. Restricting drug use through formularies or higher co payments might result in lower utilization of medicines, but studies have found that doing so creates higher costs through increased hospitalization and other health problems. Drug Spending Trends

Increased spending on prescription drugs is often attributed to higher prices for existing and new drugs. However, increases in spending also are determined by the volume of prescription drugs taken by patients, which is defined as the number of prescriptions and the number of days for which a given prescription provides therapy. Research supported by the National Pharmaceutical Council developed the methods needed to identify the specific price and volume factors responsible for increased drug spending. This research found that increased use of prescription drugs due to better diagnosis of disease, new medical recommendations for treatment, and in some cases, newer, more effective medicines may play a larger role than increases in price in explaining increased spending trends.

Strategy of operating pharmaceutical industry:
The pharmaceutical industry is the world’s largest industry. Pharmacy industry has seen major changes in the recent years that place new demands on payers, providers and manufacturers. Customers now demand the same choice and convenience from pharmacy industry that they find in other segment. Bangladeshi Pharmaceutical Industry is poised for high consistent growth over the next few years, driven by a multitude of factors. Top Bangladeshi Companies like Square, Opsonin and Beximco have already established their presence. The pharmaceutical industry is a knowledge driven industry and is heavily dependent on Research and Development for new products and growth. However, basic research (Discovering new molecules) is a time consuming and expensive process and is thus, dominated by large global multinationals.

While many pharmaceutical companies have successfully deployed a plethora of strategies to target the various customer types, recent business and customer trends are creating new challenges and opportunities for increasing
profitability. In the pharmaceutical and healthcare industries, a complex web of decision-makers determines the nature of the transaction (prescription) for which direct customer of pharmacy industry (doctor) is responsible. Essentially, the end-user (patient) consumes a product and pays the cost. Use of medical representatives for marketing products to physicians and to exert some influence over others in the hierarchy of decision makers has been a time-tested tradition. Typically, sales force expense comprises an estimated 15 percent to 20 percent of annual product revenues, the largest line item on the balance sheet. Despite this other expense the industry is still plagued with some very serious strategic and operational level issues. From organizational perspective the most prominent performance related issues are enlisted below: a) Increased competition and shortened window of opportunity. b) Low level of customer knowledge (Doctors, Retailers, Wholesalers). c) Poor customer acquisition, development and retention strategies d) Varying customer perception.

e) The number and the quality of medical representatives.
f) High training and re-training costs of sales personnel.
g) Very high attrition rate of the sales personnel.
h) Busy doctors giving less time for sales calls.
The pharmaceutical industry is characterized by heavy R&D expenditure. It is only the large pharmaceutical companies who can allocate significant resources for R&D to introduce new products. As the products are outcomes of significant R&D expenditures incurred by these companies, they have their products patented. The patent allows the companies concerned to wield immense pricing power for their new products. What’s the secret behind these successes? For one, the company operates in niche formulations (chronic) segments such as psychiatry, cardiovascular, gastroentology and neurology. While most of the top Bangladeshi companies have focused on antibiotics and anti– infectives (acute), Aristo Pharma focused on therapeutic areas such as depression, hypertension and cancer. The company has introduced the entire range of products and has gained leadership position in each of these areas. Being a specialty, company insulates Aristo pharma from the industry growth. One of the constants of pharmaceutical company strategy over the past decade has been increasing scale.

Only by growing larger are companies able to afford the considerable costs of drug development and distribution. Within this broad approach at least two business models are discernable: (i) Super Core Model involving the search for, and distribution of a small number of drugs from Chronic Therapy Area that achieve substantial global sales. The success of this model depends on achieving large returns from a small number of drugs in order to pay for the high cost of the drug discovery and development process for a large number of patients. Total revenues are highly dependant on sales from a small number of drugs. (ii) Core Model in which a larger number of drugs from Acute Therapy Area are marketed to big diversified markets. The advantage of this model is that its success is not dependant on sales of a small number of drugs. Medical representatives are rearranged throughout the new companies. Some of the sales representatives are now afraid of losing their job, due to the changing scenario and the possible lay offs. On the other hand, the new, bigger, pharmaceutical companies are competing more and more with one another, and, in order to stress their products, might adopt a more aggressive sales strategy. For example, sometimes in the same geographical area there are five representatives for just one company, or different representatives for the same drug in different settings. As a result of the new, aggressive strategy, the aggressiveness of representatives has also been increasing, since the larger stress exerted by their companies might affect their stay in the company. Therefore, they tend to have more frequent visits to encourage doctors to prescribe drugs and thus increase sales. Pharmaceutical marketing is a specialized field where medical representatives form the backbone of entire marketing effort. Pharmaceutical companies also appoint medical representatives and assign them defined territories. Medical representatives meet doctors, chemists and stockiest as per company norms. Medical representatives try to influence prescription pattern of doctors in favor of their brands.


There is tremendous potential for the export of medicine from Bangladesh to become a growing, booming business. The pharmaceutical sector has a large potential market abroad. Drugs produced in the country commands high demand
in the foreign markets as the sector maintains high quality.

Policy plays important role in boosting any industrial sector and that has happened to the pharmaceutical industry of the country. 1982 is considered as a landmark in the pharmaceutical industry history of Bangladesh when a new Drug Policy was formulated in the year. The objective of the policy was to become self-reliant in the pharmaceuticals sector to provide essential drugs to patients at an affordable cost, to uphold consumers interest by providing them effective and quality drugs. Drug Policy was found highly successful in achieving almost all its declared objectives. In fact, Bangladesh was the first and the pioneer in formulating such a policy in the line with the guidelines for essential drugs as recommended by the World Health Organization (WHO).

The Drug Policy is under review to meet the needs of the present time. According to the Minister, Ministry of Health and Family Welfare, Dr. Khandaker Mosharraf Hossain, the draft has already been proposed. To his opinion the reviewed policy will further facilitate the growth of the pharmaceutical sector. (Source: The Business Bangladesh, March 2004)

Bangladesh is now almost a self-sufficient in its pharmaceuticals sector as 97% of the country drug demand is met by local manufacturers. With the success in the domestic market place the Bangladesh Pharmaceutical Industries are now attempting to enter into the international market.

Strength and weaknesses of Bangladeshi P/companies
In general, Bangladeshi pharmaceuticals companies are now stronger in terms of quality product, attractive design, safe packing, timely delivery, and competitive price. Almost every good company has ISO certificate and sound quality control system run by qualified staff. The leading companies are maintaining international standards in all spheres of their business activities. Several companies are of world standard and deserve strong competitiveness in the world market. Main weakness with the local companies is the dependency on the imported raw materials. Research and development needs to be progressed further for long term sustainability.

1. Product design
Although product design varies from company to company, but the leading local and foreign companies have certain standard on product designing that is acceptable to world market. They use quality design of packs, strips, bottle cover etc.

2 Quality
Top 25 companies are producing products of international standard and all manufacturers follow Gross Manufacturing Practice (GMP).

3. Price
Since the local government strictly controls price of pharmaceutical products, there is a very negligible price difference. The maximum retail-selling price of a product shall be just double the price of API plus value added tax at15% VAT. But, the price of raw materials is competitive which is fixed based on international market situation.

4. Terms
Terms and conditions of sales are almost same for every company, since the profit margin is almost same for every product. Usual discount for the traders/retailers’ level is 12-15% for local Formulations and 10-12% discount for imported Formulations. Some companies offer special discount to the traders that ranges from 2.5% to 7.5%. Provision of credit sales is not usual practice.

5. Delivery
Most companies deliver goods to the retailers and traders by their own transport arrangement as independent third party distribution channel does not exist.

6. Back-up services
Back-up services are there at retailers’ level. Expired unsold products are refunded at a certain percentage. Loss and damages are also compensated depending on the quantity of medicine.

7. Promotion
Market and sales promotional activities are carried out by field level sales force. Every company has its own sales at local and international level. Required transport facilities are given to the sales force in the field to visit doctors, health care centers, hospitals and private practitioners. Only product literature, pad, diary, gifts, etc. are used during sales calls. Adequate promotional materials are distributed to the practicing Doctors for their regular use. According to the local laws, advertisement on products or brands is not allowed through any media. Product advertisement can be published in the medical journals provided there is prior permission from the concerned authority.

Trend of export

Export of local pharmaceutical products has experienced positive growth during the last one decade. In fact, this has been a great achievement for the sector as a whole, which has been eventually possible because of the government liberalization policy including a favorable and conducive National Drug Policy in 1982. First export of pharmaceutical products was made in 1972 and the amount was very insignificant. Growth in the volume of export of pharmaceuticals was very slow till 1990. After 1990, the volume of export of pharmaceuticals had started growing and over the years, the volume has increased gradually. Increasing trend in the export of pharmaceuticals has continued till this year. During the ten months (July2003-April 2004), Bangladesh made an export of US$ 8.66 million and estimated export for the year will be US$ 10.39 million. At present, Bangladeshi pharmaceutical companies export to more than 50 countries that include Bhutan, Myanmar, Cambodia, Hong Kong, India, Indonesia, Japan, Korea, Maldives, Nepal, Pakistan, Philippines, Singapore, Sri Lanka, Thailand, Vietnam, Brazil, Colombia, Egypt, Ethiopia, Finland, France, Ghana, Greece, Iran, Geordan, Kenya, Korea Republic, Mexico, Netherlands, Norway, Papua New Gini, Soudi Arabia, Sudan, Yemen, Djibuti, Senegal, Germany, USA, Oman, Russia, Ukraine, Austria, Australia, Belgium, Malawi, Malaysia, Middle East etc. Several companies have opened their overseas branch to promote export market.

Local pharmaceutical companies exporting products are namely, Beximco, Square, Jayson, ACME, Renata, Gonoshastha, Novartis, Eskayef, Essential Drugs Company Limited, Global Capsules, Navana, Maxfair, Millat, Skylab, Aristopharma, UniMed and Unihealth, Modern, Beximco Infusion, Opsonin, Drug International, Medimet, ACI, General, Nipa and Aventis. Major growth in export of pharmaceuticals has been achieved in the participating countries those who are going to attend the Asia HealthCare 2004. Countries that are importing products from Bangladesh are namely, Vietnam, Philippines, Thailand, Singapore, Sri Lanka, Malaysia, Indonesia, Cambodia, China, Nepal, India. These countries import pharmaceutical products from Bangladesh on regular basis, although the quantity of import is not very significant.

Export impediments

Although the government has formulated favorable policies, the exporters of pharmaceutical still face the following constraints and impediments: • Allocation of inadequate expenses for operating foreign sales office • Registration in the importing Countries

• Delay in issuance of the FSC Issue of “Free Sale Certificate” by the Regulatory Authority • Lack of incentive for Export
• Customs hassle for shipment of Samples
• Absence of Data Base on Importers and Exporters.
• Difficulties in finding reliable Distributors/ Agents
• Unreasonable tariff imposition
• Lack of Information on Importing Countries on matter relating government formalities, Registration requirements.

Existing export development plans
Some 27 local pharmaceuticals companies are regularly exporting from Bangladesh and all of them have annual export development plans. New companies are planning to enter into export market and developing their export plans. Individual companies initiate their export promotion activities. So far, the government or the trade promotion office’s contribution to promoting export market was negligible. Individual companies
promote their product through participating in the international Trade fairs and Exhibitions of pharmaceutical products, distribute product literature and visit to the prospective foreign buyers and agents. The existing exporters apply the following techniques for export market development: a) Attending trade fairs, buyers/sellers meeting

b) Meeting with the Representatives of the local business communities, trade associations and chambers
c) Holding clinical meetings
d) Meeting the officials of the commercial sections of the Embassy e) Meeting the officials of the concerned regulatory authority. The exporters also take the following promotional measures for trade promotion: a) Incentive to the local agents

b) Inviting local agents for sales meeting in the country
c) Setting up marketing office in the overseas
d) Contacts with the regulatory authority and the ministry
e) Sponsoring participation of seminar of Doctors in Bangladesh f) Distribution of literature

Export incentives provided by the Government
There is no provision for cash incentives in Bangladeshi pharmaceuticals exporting. Recently, this issue has been repeatedly discussed within the stakeholders and they are actively pursuing for this cash incentive in order to remain competitive in the export market. So far, the existing Export Policy of the government offers incentive that is applicable to all exporters including pharmaceutical companies: a) Value added tax at 15% is exempted on the products produced for export; b) Any individual or organization can utilize foreign currency for the purpose of export of any products

c) Tax is exempted in case of corporate export income
d) In case of “Deemed Export”, VAT is totally exempted

Apart from the above incentives, other incentives for export are:

a) Export credit guarantee scheme for coverage to the exporter. b) Export credit guarantee for pre-shipment
c) Export Credit guarantee for post shipment
d) Export payment Risk policy (Comprehensive guarantee)
e) Whole turnover pre-shipment finance guarantee. The government has its program but in reality a few are being practiced.
f) Currency conversion facility (taka) under this system. Exporters are allowed to keep foreign currency in their account g) Foreign currency utilization facility
h) Exporters are allowed to utilize foreign currency carved from the farther export purpose. i) Export Development fund: the fund will be utilized to provide assistance to the local manufacturers and for export marketing, export diversification and development of export of non-traditional items. These include attending seminar, made fairs, setting up sales center in foreign country. j) Extension of export credit period from 180 days to 270 days. Period of Export credit under export development fund has been extended up to 270 days. k) Export Financing: Credit card has been introduced to reduce risk of carrying cash dollars by the exporters. l) Limit of margin of export has been increased up to 90% i.e. any exporter can avail loan up to 90% of the contract price or L/C value. m) Credit for new and fresh exporters is given if they apply. n) Total flow o export credit will be maintained.

o) Export loan portfolio has been introduced by the central bank to ensure regular export financing. p) Incentive will be given in case of export of new industrial products. q) 50% of the total export earnings will be tax exempted

r) Duty draw back facility will be provided through commercial bank in order to keep the market price competitive. s) Bonded warehouse facility for exported has been encouraged t) Capital machinery may be imported without any tax

u) Tax holiday provision shall be imposed by the government
v) Sample for export: Limit for sending sample for trade fair is US$ 2,000 and other purpose the limit is US$ 1,500. Sending sample through parcel post is increased at US$ 59.00 w) Re-export: Permission is not required from the MINISTRY of Commerce on case to case basis and VAT is reduced at 5% from 10% x) Export as that L/C: Products can be exported on the basis of buying contract, agreement, and purchase order to advance payment. In this case, the exporter has to submit EXP Form and shipping bill. y) Import or advance payment L/C: L/C will not be required in case of import of capital machinery and basic raw materials and perishable item for re-export. z) Product Diversification Project: To keep export price at competitive level, arrangement shall be made for duty draw back and cash incentive for export.

Export financing

No special credit facility or system exists for financing export of pharmaceutical products. There was an “Export Credit Guarantee Scheme” for all sorts of exports under the control and supervision of the central bank, but the performance was not satisfactory. The scheme was targeted for overall industrial sector, but not specifically for the export of pharmaceutical products. However, the local and foreign banks working in Bangladesh have been supporting export activities of any kind through extending their foreign trade services.

Government policy on export

In general, Bangladesh government strongly encourages all kinds of export including Pharmaceutical products. During the month of May 2004, the government revised ‘National Drug Policy’ in order to make it more conducive for the foreign investors as well as the local producers planning to promote exports. Regarding rules and regulations of export of pharmaceuticals, the country’s existing “Export and Import Policy” is followed. The government has plans to introduce more conducive policy to boost export of pharmaceuticals in near future.

Trade promotion activities

1. Export development services
In Bangladesh, there is no special trade promotion office or cell provinding export marketing and promotion services for pharmaceutical sector. Export Promotion Bureau (EPB) is the only public sector organization specialized in extending variety of export development and marketing services to facilitate the local exporters of all sectors. EPB provides information on export market and organizes activities related to export marketing and export market development. Besides, there is a a growing number of private consulting houses that provides business services including marketing services. Individuals are working as marketing agent or distributors who explore export market for local companies. Local consulting firms are also preparing the companies for export through quality certification and other management development. It is expected that export development services will be developed in near future as the country will enjoys enormous benefits from the TRIPS after 2005.

2. Trade promotion activities
Recently, as mentioned earlier, the Ministry of Commerce and Export Promotion Bureau in collaboration with the sector association of pharmaceutical companies i.e. BAPI have taken special initiative or program for export promotion of pharmaceutical sector. Activities like organizing trade missions and group visits to international trade fairs, displaying pharmaceutical products in Bangladesh pavillion abroad and organizing buyers/sellers are the now regularly organized by the Ministry of Commerce and Export Promotion Bureau and the trade bodies including Federation of Bangladesh Chambers and Commerce and Industry (FBCCI).

Possibilities in matching standard and price in international market:

Now a days Bangladesh is a renowned name in the international market for its standard of pharmaceutical products. Our pharmaceutical industry competes with international company. Bangladesh has been trying to fulfill the national aspiration of turning its pharmaceutical industry into an exporter of quality medicines. In mid-90’s a few companies took initiatives to export
pharmaceuticals from Bangladesh. Today, Bangladesh is exporting its pharmaceuticals to various countries like Singapore, Russia, Ukraine, Georgia, Pakistan, Myanmar,Vietnam, Sri Lanka, Nepal, Kenya, Germany, Yemen, Malaysia, Iran, Philippines, Sudan, South Korea, Bhutan and Hong Kong. It is worth mentioning that the world renowned hospitals & institutions like, KK Women & Children Hospital and Raffles Hospital of Singapore, MEDS of Kenya and Zinnah Hospital of Pakistan have been using the Pharmaceutical products of Bangladesh. Because,Bangladeshi pharmaceutical standard matched to the international standard. Bangladesh has been exporting wide range of products covering almost all therapeutic classes and dosage forms. Apart from exporting tablet, capsule, syrup, suspension etc., it also exports ‘High Tech and Specialized products’ like Metered Dose Inhalers (MDIs), Nasal Sprays, Suppositories, Large Volume Potentials (LVP) and small Volume Potentials (SVP). Bangladesh is now on the verge of entering highly regulated overseas markets like USA and Europe. In this connection, three major pharmaceutical manufacturers have already made huge investments in their new plants/factories. Price in international market for pharmaceutical products is much higher than Bangladesh. Because our labor cost is lower than international sector. External price referencing (or international benchmarking) stands to affect the prices and availability of medicines outside the country undertaking the benchmarking practice by reducing manufacturers’ willingness to set prices according to national market conditions. This may have a negative effect on affordability and availability of medicines in smaller markets and lower-income countries, including lower-income countries in the OECD.

The practice of agreeing to confidential rebates can also have an external effect, in that other countries using external benchmarking may reference artificially high prices, resulting in list-price inflation. Claw-backs have a similar impact in that they mean the price is effectively changed post-purchase (after the list price has already affected the global price through external benchmarking). The convergence in list prices of pharmaceuticals that has been observed in Europe (including Switzerland) and between European countries and Canada is consistent with what would be expected in a market characterized by such practices.

Mode of transports
All most all pharmaceutical companies procure raw materials through indenting houses, except a few big companies. Formulations are imported through the local agents of the foreign companies. But, there are also direct Importers, Druggists and Chemists who import products for trading purpose. In case of import of raw materials and finished products, the local indenting houses and Clearing and Forwarding Agents play an important role. In Bangladesh, the local importers of drugs and medicines are well organized. Terms and conditions of import of raw materials vary from product to product as well as manufacturers. There is no restriction on quantity and quantity depends on the requirements of individual companies. There is no restriction on import of packing and packaging materials. Lead time of import depends on country of origin and mode of transports. In case of Active Ingredients the provision for safety margin is 3-4 months (by sea) and 2 months (by air). For Excipients safety margin provision is 6-8 months if the shipment is made by sea and 4 months (by air). For Finished products, it is 2-4 weeks. Four different modes of transport are being used for import and these are by air, by sea, by rail and by road. However, major parts of the imported materials are coming by sea. Usual point of entry is Chittagong (90%) and Mongla. For import of high power but light and costly pharmaceuticals, the local importers use air route frequently. Some portion of the import is also coming by road through land border mainly from India

Packing and packaging materials

Packing materials used in the local pharmaceutical industries include aluminum foil (blister & strip), Alu alu foil, rubber stropper, flip-off seal, printing materials, plastic cap, injectible, tear-off seal, tube, PVC, PVDC, level, bottle (white & color), plastic container, paper cartoon, printing materials, packets, etc. Almost every packing material is locally available except aluminum foil, alualu foil, PVC, PVDC, color bottles, etc are imported from countries like Korea, Dubai, India, China and so on.

Import duty structure and basis of valuation
Import duty and other taxes are charged on both Formulations and raw and
packing materials. Import duty on any active ingredient exclusively used for pharmaceutical products is 7.5%. In case of commercial import, the import duty is 15%. Value added tax is collected at 15% from all imports, but it is adjusted afterwards on the basis of actual production output. Raw materials used for products will be exported ultimately require no duty. Advance Income Tax (AIT) is also charged but to be refunded later. Cost, Insurance and Freight (CIF) price of the materials to be imported is the basis of assessment of import duty and other taxes. This may vary in an exceptional situation. In addition to duty assessment, tariff value is also imposed. Such tariff value is assessed on the basis of the highest CIF value of raw materials being imported by other importers. Assessment of tariff value depends on the discretion of the customs authority, and it varies from case to case and it is a determinant factor of actual landed cost of any imported materials. In addition, there is a provision for Development Surcharge at 2.5% of the CIF value. Apart from this, every import incurs basic costs that include license fee (0.25% of the CIF value), L/C commission for opening letter of credit (0.3% to 0.5% of the L/C value or minimum US$ 6.5), bank charges, and insurance premium at 1% of the C & F value of the materials to be imported. The Government Customs department through its designated officials assesses the value of import in “local currency (Taka)”, based on the “invoice value”.


1. Laws and regulations
Relevant Laws and Regulations commensurate with the prevailing circumstances usually control and regulate production, distribution, sale and use of drugs in a country and ensure that they are of good quality, efficacious and safe. Currently, the Drugs Act, 1940 (XXIII of 1940) and the Drugs (Control) Ordinance, 1982 (Ordinance No. VIII of 1982) regulate the process of registration, manufacture, distribution, sale, import and export of drugs in Bangladesh. These drug regulatory legal instruments of the country are now quite old. Recently, the drug policy 1982 has been revised through necessary amendments to keep pace with newer developments in the drug sector. Similarly, the Rules made under the above Act and Ordinance should also be
updated and integrated into one set of Rules.

If the functioning of these laws and regulations and their compatibility with other laws, either under the responsibility of the Ministry of Health & Welfare or other Ministries and Departments, affect implementation of the different aspects of the NDP, they should be amended accordingly.

2. Drug Regulatory Authority (DRA)
A strong administrative set-up is essential for effective management of the various aspects of the drug sector of a country. The Directorate of Drug Administration of Bangladesh has been proposed to strengthen to effectively perform the various functions of the regulatory authority. The following measures have been taken:

i. The status of the Directorate of Drug Administration (DRA) raised to that of the Directorate General of Drug Administration ((DGDA) with corresponding increase in its manpower and infra-structure facilities.

ii. The organgram of the DGDA accommodates all lawful systems of drugs and regulate them under unified control.

iii. The regulatory responsibilities has been decided to be delegated to different directors under DGDA to expedite and facilitate the functional processes.

iv. The decision-making processes will be guided by the objective, non-discriminatory and transparent guidelines and procedures.

v. The staff of the DGDA will be adequately trained , have clearly defined functions and powers, and be entrusted with responsibility in relation to all aspects of registration, manufacture, storage, distribution, sale, import, export and quality of drugs in order to ensure compliance with the laws, rules and regulations.

3. Drug registration
All drugs and medicine and other medicinal substances in finished dosage forms, which are manufactured, imported, distributed, marketed or consumed in the country must be registered with the Drug Regulatory Authority (DRA) of the country in the specific dosage form and strength as recommended by the Drug Control Committee (DCC).

a) Selection of drugs for registration

(i) Selection of a drug either for manufacture or import is one of the important functions of the National Regulatory Authority (NRA). For this purpose the current system of having a drug registration advisory committee (DCC), which comprises of experts and professionals from various disciplines, will continue.

(ii) Quality, safety, efficacy and usefulness will always be the predetermining criteria for approval for sale of pharmaceutical product.

(iii) The Directorate General of Drug Administration, with approval of the DCC, shall select and make lists of Essential and Non-Prescription (OTC) drugs following the WHO Guidelines and Model lists of such drugs time to time.

b) Registration criteria

(i) As a general principle, registration for manufacture, import and sale of combination drugs other than those of Unani, Ayurvedic & herbal preparations, vitamins and nutritional preparations should not be allowed in the country. However, combinations like vitamins, nutritional preparations and other drugs which are therapeutically useful and are registered in the developed countries, could be considered for registration. In case of the Homeopathic system also, registration for manufacture, import and sale of combination medicines shall not be generally allowed.

(ii) In case of imported allopathic drugs, the manufacturing site will be inspected for GMP validation by the inspectors of the drug regulatory
authority of Bangladesh. The inspections will be scheduled by the DRA and the concerned manufacturers will bear the cost of any such inspection. However, the inspections will not be a bar to the consideration of a new drug application manufactured in a developed country included in the list of the Licensing Authority.

(iii) Bioavailability and bioequivalence data will be considered as important criteria for the registration of any imported medicine.

(iv) Any Unani, Ayurvedic or Herbal drug included in the formulary of other countries, if considered essential and useful by the National Unani, AYURVEDIC & Herbal formulary Committee, may be granted registration for manufacture and sale in the country. National Unani, Ayurvedic & Herbal Formulary Committee will be constituted by the government with the experts on Unani, Ayurvedic and Herbal drugs.

(v) Single registration for Mother Tinctures, Mother Triturations and 12 bio-chemic and their 1X potencies of the homeopathic system may be allowed.

(vi) Biochemical products will be registered by the Licensing Authority (Drugs) based on their safety, quality and usefulness.

(vii) Liquid dosage forms of unani, ayurvedic and herbal ayurvedic and herbal drugs that contain up to 5% (v/v) of 96% ethanol may be allowed to be registered, if use of such high proportion of ethanol is absolutely needed for their better efficacy and keeping quality. However, in exceptional cases, use of ethanol up to a maximum volume of 10% (v/v) may be allowed, if recommended by the DCC.

(viii) Certain drugs, in spite of their known serious side-effects and possibility of being misused, may be registered for import, production and sale in limited quantities for restricted use.

c) Registration procedure
The current procedures adopted for registration of drugs of all the
recognized systems, as specified in the existing laws, should continue after modifying or upgrading them as appropriate. But, efforts should be made to develop methods for expediting the processes of registration.

4. Drug production
(i) One of the main objectives of the NDP is to produce good quality drugs in the country. The current Good Manufacturing Practice (cGMP) guidelines of WHO should thus be strictly followed in the manufacture of drugs in the country. In order to ensure strict compliance with the requirements of cGMP, all drug production units should be subject to regular inspection by the Inspectors of the Directorate of Drug Administration. The manufacturers will also be expected to conduct periodic internal cGMP audit following the standard “Check-list” of the Directorate of Drug Administration.

(ii) Another main objective of the NDP is to ensure self-sufficiency in all types of drugs. Therefore, all necessary measures should be undertaken to ensure that the current trend of increased rate of local production of drugs is sustained and further improved.

(iii) Priority should be given to production of adequate quantity of essential drugs. Efforts would be made to ensure that all the essential drugs and non-prescription (OTC) drugs (lists f which are appended to this policy) are manufactured in the country in sufficient quantities and they are available at affordable prices.

(iv) Foreign and multinational companies will be allowed to invest and manufacture drugs in Bangladesh as long as they have at least three of their original research product. Drugs registered in at least two of the following countries: USA, UK, Switzerland, Germany, France, Japan and Australia.

(v) Manufacture of drugs that are not included in the last five editions of the British or United States Pharmacopoeia (USP) or International Pharmacopoeia (IP) or the British Pharmaceutical codex (BPC); or in the WHO lists of the International Non-proprietary Names (INN), will be prohibited.

(vi) In order to encourage transfer of technology and availability of the newly developed drugs, foreign companies, with or without having manufacturing plants in Bangladesh, will be allowed to manufacture drugs in the country under licensing agreements with any partners of their choice.

(vii) The task of producing Unani, Ayurvedic and Herbal drugs will lie solely with national manufacturers with a view to attaining self –sufficiency in respect of local resource based drugs.

(viii) Both local and foreign companies having manufacturing plants in Bangladesh will be allowed to manufacturers drugs under toll / contract manufacturing arrangements at any other manufacturing plants o their choice.

(ix) For the purpose of export only, any drug may be allowed to be produced in the country in accordance with the specific requirements of the importing country.

5. Drug procurement
(i) Drugs and pharmaceuticals may be procured by local purchase or import, and by receiving as donation or gift.

(ii) Drugs for personal use of individual patients or to meet any national emergency situation or for the purpose of research and clinical trials or for any other specific use, which are not registered, may be imported with prior approval of the Licensing Authority (Drugs) for specific quantity and for non-commercial purpose.

(iii) Importation of a drug that is produced in the country in adequate quantity will not be allowed as a measure of protection for the local industries. However, if local production of any drug falls short of need for any reason, or in case of emergency arises, this condition may be relaxed by the Government for a specified period.

(iv) Any basic pharmaceutical raw material, which is locally manufactured in sufficient quantity, will be given protection by disallowing import of this
raw material or its substitute in the country. However, if needed for export purpose, importation of such pharmaceutical raw materials will be allowed in competitive prices through international tender.

6. Drugs distribution, sale and storage
Prompt and safe distribution and ethical sale of drugs from public/ private storage facilities to the end –users should be ensured so that the quality of the products is maintained throughout the whole process and good quality essential drugs are always available to those who need them.

(i) Only the drugs, which are registered in Bangladesh, should be allowed to be distributed and sold in the country.

(ii) No Person without having professional qualification or holding valid professional license should be allowed to stock, distribute or sell drugs and medicines.

(iii) No drugs or medicines, other than non-prescription (OTC) drugs, should be sold or dispensed without prescriptions.

(iv) Maintenance of quality and safety of drugs in retail outlets and in storage should be ensured by carrying out regular checks by Inspector of drugs on the quality of stored drugs at all levels.

7. Drug pricing
(i) Rational pricing of drugs should be ensured to make essential drugs available to the endusers at affordable prices.

(ii) The current system of controlling prices of commonly used essential drugs should be continued and the existing list of the prices-controlled drugs should be updated in the light of current pattern of changes of drugs used in the primary healthcare.

(iii) The existing system of linking prices of locally produced drugs with costs of raw and packing materials and that of imported finished drugs with
landed cost should be revised for rational fixing of Maximum Retail Prices (MRP) of drugs.

8. Quality assurance of drugs and pharmaceuticals
One of the most important objectives of the NDP is to make good quality drugs available at affordable prices. In order to achieve this objective, quality building in a drug at the manufacturing stage by in process quality control and quality keeping in the drug in transit and storage should be ensured by testing it at different stages before it reaches the end –users.

(i) Each pharmaceutical company should have a quality control and quality assurance system, which would monitor the entire process form the acquisition of raw material to its conversion into a finished product.

(ii) Each Manufacturer should have a dedicated team of professionals for adequate product and process design and statistical control of the process through in- process and end- product testing.

(iii) There should be documented Standard Operating Procedure (SOP) based on WHO recommended cGMP guidelines for manufacture of each product as well as for each manufacturing unit process.

(iv) All the unit process should be periodically validated to ensure correct end –results. The validation results should be properly documented.

(v) Qualified professionals related to pharmaceutical sciences should be employed in all the relevant departments, related to quality control and quality assurance, of a manufacturing plant following the guidelines of WHO in order to ensure production of good quality drugs.

(vi) Quality of marketed drugs should be ensured by frequent post-market surveillance by the Drug Inspectors and testing random samples of the marketed drugs in the Quality Control laboratories.

(vii) In addition to the QC laboratories of the companies there should be one
Central Drug Testing/ Quality Control Laboratory and a number of Regional Drug Testing/ Quality Control Laboratories under the Directorate of Drug Administration with separate units for unani, ayurvedic, herbal and homeopathic-biochemical drugs, manned by technical experts of the respective disciplines.

9. Manpower of the manufacturing units

(i) All manufacturing units should be staffed with adequate number of Professionals related to Pharmaceutical sciences in accordance with WHO guidelines in order to produce good quality, safe and effective drugs and pharmaceutical.

However, the unani, ayurvedic, herbal and homeopathic-biochemical drug manufacturing units should be staffed with adequate number of Qualified persons of the respective disciplines and, where necessary, pharmacists, chemists/ biochemists, and botanists.

(ii) Persons with relevant qualifications should be employed in the various departments of the manufacturing units following the guidelines of WHO and strictly following the relevant laws of the country.

(iii) Adequate number of other supporting trained and skilled technical personnel should be employed for smooth functioning of the manufacturing plant.

10. Drug information and monitoring

(i) The Directorate of Drug Administration should have a well-equipped Drug monitoring and information Unit.

(ii) Data on production, import, export, procurement storage, distribution and sale should be compiled, monitored and evaluated to ensure availability of drug at all levels of the country’s health care facilities both in public and private sectors.

(iii) Safety, efficacy and quality of all registered drugs should be monitored regularly and information on any substandard, spurious and counterfeit drugs should be made freely available to all concerns by wide publicity in both print and electronic media.

(iv) Rational use of drugs (RUD) should be ensured by conducting surveys on the systems of prescribing, dispensing and patient compliance.

(v) Monitoring and reporting of adverse reactions of drug (ADR) should be seriously done to ensure safe and rational use of drugs in the country.

(vi) Objective and educational advertisements of Non-prescription (OTC) drug based on scientifically established evidence and in good taste may be allowed with prior approval of the Drug Regulatory Authority (Current lists of OTC drugs of allopathic, ayurvedic and unani systems are appended to this Policy).

11. Essential drugs
There will be a List of Essential Drugs for Bangladesh. The Directorate General of Drug Administration shall update and maintain the list of essential drugs in line with the current list of Essential Drugs of the World Health Organization.


Like firms in other industries, pharmaceutical manufacturers try to maximize profits from their operations. Since unit production costs can be considered independent of the level of production, maximizing profits translates into maximizing positive cash flows during the life of a product, and particularly during the period in which the product benefits from market uniqueness.

In order to meet this objective, a pharmaceutical manufacturer will launch as quickly as possible in the markets with the highest sales potential (in
terms of volume and prices), will price its products as high as possible according to market conditions and regulatory constraints, will try to extend the period of market uniqueness, engage in promotional activities to capture as large a piece of the market as possible and aim to expand the potential market for its products.

Value edition:

The pharmaceutical industry of Bangladesh in now capable of producing drug products by meeting their highest quality standard. It maintains high standard of Quality Assurance in manufacture and control of drug and drug products. A competent regulatory known as the Directorate of Drugs Administration. And their Manufacturing facility and practices with the requirements of CGMP (Current Good Manufacturing Practice) and regulations. Bangladesh has manufacturing facilities meeting the highest CGMP requirements. Quality Control Laboratories are equipped with sophisticated equipment and meet the requirements of CGMP. Specifications and test methods for raw materials and drug products are based on British Pharmacopoeia (BP) , United states Pharmacopoeia (USP ) and European Pharmacopoeia (EP).Good Manufacturing Practice (GMP) is the basic concept for maintaining quality control of finished drugs and medicines. A few pharmaceutical companies in Bangladesh received internationally acclaimed “ISO 9001 & 9001:2000 Certificate” in recognition of their quality. For achieving such recognition the door has been opened and has got access to the Asian, European & African market for Bangladesh products. Quality Assurance System in place ensures that the facility, equipment, process and test methods are validated and instruments are calibrated. Qualified and trained personnel are employed in the manufacture and testing of drug products. Products are released only after review by Authorized person and that increase the value of the product. With regards to raw materials sourcing, the pharmaceutical manufacturers in Bangladesh procure raw materials from various countries namely UK, France, Germany, Japan, Holland, Italy, Denmark, China, Switzerland, Austria, Hungary, India, Ireland etc., In case of raw materials that are locally manufactured, we do not go for import.

Regulatory environment and recent changes in the National Drug Policy

In order to ensure adequate supply and availability of good quality essential drugs at affordable prices, a radical and far-reaching National Drug Policy (NDP) was formulated in 1982. Following the guidelines of the NDP, a Drug (Control) Ordinance was also promulgated in the same year. These two documents produced tremendous positive effects on rapid development of the local pharmaceutical sector and gradual improvement in the drug sector for the country. After having 22 years of steady growth in the local pharmaceuticals industry sector, the government and other stakeholders updated and modified the policy through inclusion of new elements in order to properly deal with the changes and development that have taken place so far. Accordingly, the National Drug Policy 2005 has been formulated meeting the current needs of the country as well as the global business environment. Revised National Drug Policy 2005 has focused on the following:

• Applicability, effectiveness and adaptability to the recent remarkable technological advancement in the medicine world. • A competitive drug sector to perform better in the world market • A brand name in the world as a producer and exporter of quality drugs.

The revised policy empowered more authority to the Directorate of Drug Administration (DDA) through converting it into Directorate General of Drug Administration (DGDA), which will reduce bureaucracy in one sense and speed up workflow under the same roof. All modern facilities planned to be created for testing and other purposes and the officials will be trained on latest tools and techniques in order to improve regulatory environment as well as to deliver quality services to the industry. The new policy also helps better and strict monitoring of illegal activities and malpractices in the industry. It is more open to the multinational companies who are interested to undertake ‘research and development’ for producing improved quality and innovative drugs. This policy also helps in setting up of plant for producing raw materials i.e. active ingredients by the local and foreign investors. There is also provision for Toll or contract manufacturing, licensed manufacturing, franchising and other facilities to attract the
foreign investors.

Research and development
The leading pharmaceutical companies have been able to bring advanced technology from developed countries. So far, there are no research findings on the “new molecule” in Bangladesh, although there is continuous development of Formulations. Recently, one company has set-up a plant to produce anti-cancer hormone and specialized products. Companies have their product development team who continuously undertake ‘Research and development’ activities. Common research and development activities are as follows: a) Bibliographic search aided by resource libraries,

b) Design and selection of process maximizing efficiency,
c) Environmental impact assessment reduction,
d) Accelerated and longer stability testing,
e) Product quality optimization and
f) Translation of new scientific insights into the products. Several companies have been conducting study on vaccine for critical disease like anti-cancer, antidiabetics,etc. in collaboration with foreign experts. Many studies are also being carried out to produce herbal medicines. Formulations development is going on continuous basis in many companies irrespective of their size. There is a good progress in raw materials development in collaboration with the western countries. Test method is developed and validation is done according to the British Pharmacopia and US Pharmacopia. Also, stability study and validation of process is undertaken for new Formulations. Since the get-up packing materials and packaging is very important for export marketing, companies exports take extra care for modern and standard packaging system with attractive printing materials and convenient storing and handling options.

Bangladesh is one of the poorest countries in the world where about 80% of the population are living below poverty level. So, ‘malnutrition and poor health conditions’ exit. On the contrary, the country is also developing day by day, per capita income is growing and the purchasing power of the common
people is increasing slowly but steadily. In 2005, the per capita income is US$ 470, which was only US$ 376 earlier. Since the population growth is still there and gradual increase in health consciousness among mass people. All these factors have positive impact on the demand of the pharmaceutical products. As a result, the demand for imported raw materials will also be increased. The pharmaceuticals sector is the second largest sector after agriculture that contributes to the revenue generation of the Bangladesh Government. The sector has growth potentials both in local and export market. There is an increasing trend in the export of pharmaceutical sector that indicates very good future prospects for the country. In the local market, there is an increasing demand for medicines for anti-cancer, anti-hypertension, anti-diabetics, AIDS, cardiovascular, different vaccines etc. So far, the local pharmaceutical companies are not producing medicines for serious diseases like cancer, HIV/AIDS, diabetics etc. Recently, there are few initiatives and projects to produce high value drugs of the above categories, but it will take some time to make these products avilable in the local market.

Traditionally, there is a common belief that herbal medicines do not have any side effect. A large majoirity of people living in rural Bangladesh are still traditional in their attitude. This segment of people demand natural products for all kinds of diseases. So, there is large potential market for herbal products in Bangladesh. The demand of pharmaceutical raw materials has increased in the recent years and will increase further in the coming years since the production volume of the local companies is increasing day by day due increased local consumprion and export. As of now, the local companies are exporting to 62 countries worth US$ 21.26 million, which was only US$ 12.69 million in 2004, export increased at 60%. So, with the increase in export of pharmaceuticals, the requirement for raw materials will be higher. But, there have not been enough initiatives to produce raw materails locally except 4-5 companies that undertaken projects recently. To ensure smooth supply of raw materials, the government is determined to set-up industrial park for production of the active pharmaceutical ingredients in Dhaka instead of earlier plan in Chittagong. Although the government regulates the business of this sector including consumers’ price, the recent policy change by the government has tremendously increased the scope for new investors and multinational companies to invest in both formulation and API sector. There are some 68,000 registered Pharmacists in the country who sell pharmaceutical products at retail level. It is estimated that another 56,000 Pharmacists are operating in the retail market and are yet to be registered. The marketing people of the majority of the local companies are engaged in “push selling”. Since media campaigning and advertisement is prohibited, sales promotion is made through offering incentives to the field level sales force as well as to the medical practitioners. After eyeing huge market prospects, a good number of new companies including foreign owned have entered into the market with their manufacturing plants for formulations. The existing leading companies (Beximco, Square, etc.) have also invested large volume of fund in the sector. Reasons are the future scope of opportunities resulting from Trade Related Intellectual Property Support (TRIPS) after 2005 and to comply with the improved WHO standards to be enforced in near future.

Essay Topics:

Sorry, but copying text is forbidden on this website. If you need this or any other sample, we can send it to you via email. Please, specify your valid email address

We can't stand spam as much as you do No, thanks. I prefer suffering on my own