Faculty of Pharmacy, World University of Bangladesh

After liberation, Bangladesh pharma industry was largely dominated by the import dependent MNCs. On or before 1982 ordinance, 75% of the market was dominated by the MNCs and the rest share was with the other 133 local companies. After NDP formulation and the Drug Control Ordinance, there was a dramatic change of reverse. By 1994, a few pharma companies achieved a tremendous growth and they reinvest their profit for faster return. By next decade, Bangladesh is aiming to 30 world class drug manufacturers to establish strong footstep in global pharma market. Bangladesh, as an LDC got exempted from the obligation of patent and data protection in this arena until 2033. Interestingly, Bangladesh already passed across the LDC landmark to a developing country. So, there’s window of opportunity of more than a decade to grow further from that aspect.

Reference Id: PHARMATUTOR-ART-2632

PharmaTutor (Print-ISSN: 2394 - 6679; e-ISSN: 2347 - 7881)

Volume 6, Issue 12

Received On: 09/10/2018; Accepted On: 22/11/2018; Published On: 01/12/2018

How to cite this article: Mohiuddin, A.K. 2018. An A-Z of Pharma Industry Review: Bangladesh Perspective. PharmaTutor. 6, 12 (Dec. 2018), 64-78. DOI:

Purpose: Discussion and projection of Bangladesh pharma market in a multi-dimensional approach.

Methodology: Secondary data were used in preparing this study. Research conducted a comprehensive literature search, which included technical newsletters, newspapers journals, and many other sources. Medicine and technical experts were interviewed. Projections were based on estimates such as the history, current market scenario, drug users, dealers, mergers and acquisitions, new developments and market trends.

Findings: Bangladesh pharma market has tremendous hope, although going through lots of anomalies. Reasons behind are economic development, population blast, investment scopes, FDIs along with many other unexplained matters.

Research limitations: Market is too big to be explained in a single article. The term “A -Z” doesn’t reveal all information about Bangladesh pharma market is accomplished, rather 26 letters used in 26 headlines, that means 26 points of this market is discussed that surely comprised a greater part of it.

Practical Implication: The soul of this article was to introduce students about Bangladesh pharma market, that they have very few ideas. Along with students, researchers and professionals of different background and disciplines, e.g. Pharmacists, marketers, finance companies and regulatory authorities have to acquire much from this article.

Social Implication: Medicine manufacturers are an integral part of Bangladesh health sector. General people pay much interest but having little knowledge about them. The article should provide them a broader picture and unleash many unseen facts.

In Bangladesh, the pharmaceutical sector is now one of the fastest growing sectors. The history of Pharmaceuticals industry dates back to 1950s. Over the years, the industry has gone through some significant changes. In the early post-independence period of Bangladesh, multinational companies (MNCs) dominated the pharmaceutical sector. According to Bangladesh Tariff Commission, 2010 eight leading MNCs enjoyed 75% of the total domestic market. In 1982, a defined guideline for the development of the industry was created through the formulation of national drug policy (NDP), and drug control ordinance. Under the NDP, only local companies were allowed to produce vitamins, enzymes, and cough syrups. This led to the formation of local pharmaceuticals companies and an increase in domestic production. And Bangladesh, which was once a drug-importing country, became a drug-exporting country by the late 80s. In 2004, it was estimated that the total size of the pharmaceutical market in Bangladesh was Tk. 28.416 million. With an annual growth rate of around 10%, the Bengali pharmaceutical industry is now moving towards self-sufficiency to meet local demand. The Bangladeshi pharmaceutical industry is the second largest contributor to the national treasure after garments, and is the largest sector of intensive employment of white-collar workers in the country. IMS (2015) report shows that the market size has reached $ 1.6 billion. This industry serves almost 98% of demand through local production. The domestic market of pharmaceutical products has shown a tremendous growth over the last few years and the industry recorded 17.6% average growth between the years 2011-2015. Pharmaceutical industry has been ranked second in terms of gross value addition for many years after Readymade Garments (RMGs) and the sector has the potential to top the list. The imported medicines mainly include anticancer drugs, vaccines against viral diseases, hormones, etc. Indeed, the true growth of local pharmaceutical industries began after the promulgation of the "Drug Control Act" in 1982 in Bangladesh to limit the massive import of drugs and encourage local drug production. Many multinational companies (MNCs) were dissatisfied with this development. Category of the generic product prices are competitive, Bangladesh mainly concentrated this type of product about 80% drug because as labor cost is one of the lowest in the world. Bangladesh’s pharmaceutical sector has been growing steadily over the last twenty years.

Regulatory regime
• The Directorate General of Drug Administration (DGDA): DGDA is the drug regulatory authority of Bangladesh, which is under the Ministry of Health and Family Welfare. DGDA regulates all activities related to import and export of raw materials, packaging materials, production, sale, pricing, licensing, registration, etc. of all kinds of medicine including those of Ayurvedic, Unani, and Herbal and Homoeopathic systems.
• The Pharmacy Council of Bangladesh (PCB): PCB was established under the Pharmacy Ordinance in 1976 to control pharmacy practice in Bangladesh.
• The Bangladesh Pharmaceutical Society (BPS) is affiliated with international organizations International Pharmaceutical Federation and Commonwealth Pharmaceutical Association. The National Drug Policy (2005) states that the WHO’s current Good Manufacturing Practices (GMP) should be strictly followed and that manufacturing units will be regularly inspected by the DDA. Other key features of regulation are restrictions on imported drugs; a ban on the production in Bangladesh of around 1,700 drugs which are considered non- essential or harmful; and strict price controls, affecting some 117 principal medicines.

Government Incentive
This sector has been considered as a thrust sector in the export policy since 2006. Customs duty on 40 basic raw materials used in medicine manufacturing were reduced to 5% from 10%-25% rate. Customs duty on 14 items used in anti-cancer medicines have been withdrawn. (Budget 2014-15). Government has been facilitating this industry through reducing customs duty on raw materials. The government recently gave 200 acres of land for the API Park in Munshiganj. It is also planning to give 10% cash incentives to boost the pharmaceutical sector.

Products of The Pharmaceutical Industry
The Directorate General of Drug Administration under the Ministry of Health & Family Welfare, Govt. of Bangladesh, is the Drug Regulatory Authority of the country. This Directorate supervises and implements all prevailing Drug Regulations in the country and regulates all activities related to import and procurement of raw and packing materials, production and import of finished drugs, export, sale, pricing, etc. of all kinds of medicine including those of Ayurvedic, Unani, Homoeopathic and Herbal systems (Web DGDA).
UNANI: At present, there are 295 Unani companies operating in Bangladesh.
AYURVEDIC: At present, there are 201 Ayurvedic companies operating in Bangladesh.
HERBAL: At present, there are 15 Herbal companies operating in Bangladesh.
HOMEOPATHIC: At present, there are 79 Homeopathic companies operating in Bangladesh.
ALLOPATHIC: At present, there are 258 Allopathic companies operating in Bangladesh.

Industry Scenario
A. Local Market Overview: The Bangladesh pharmaceutical marketplace is predominantly a branded generic marketplace. Pharmaceutical firms in Bangladesh can either sell to the private sector pharmacies, to the government and its public health care facilities, or to international organizations operating in Bangladesh (e.g. UNICEF). The top two domestic manufacturers, namely Square and Incepta Pharma are having a combined market share of near 30% of the total pharmaceutical market of the country. Bangladesh Association of Pharmaceutical Industries (BAPI) was instituted in 1972, since then BAPI playing a pivotal role in shaping up the industry (Janet 2007).

B. Industry Structure: The industry has some distinct features compared to other countries. First, R&D activity is virtually nil in Bangladesh pharmaceutical industry – it is a branded generic market. Companies basically manufacture finished formulation by assembling known generic and patented (in some cases) product combination. Some firms have been engaged in producing APIs, the core of pharmaceutical products, but these productions are limited to synthesis stage (final stage) only.

C. Segmentation:
I. The primary layer is R&D Activities. This is often a very costly and high-risk business, and for many of global Pharmaceutical firms, represent the majority of costs. However, in Bangladesh, this activity is nil, and all the firms are producers of known and established drugs.
II. The second layer is manufacture of ingredients for finished formulations. These activities cover production of Active Pharmaceuticals Ingredients (API), Excipients, and Solvents etc. that are used as raw material in producing the final drug formulations. Historically, Bangladesh has been dependent on imports for APIs and other ingredients. 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.
III. The final layer concerns producing final products, finished formulations. In this layer, there are both patented and generic products. However, in Bangladesh, only generic products are produced. Formulations represent the mainstream business in pharmaceuticals industry of Bangladesh. Presently, the market consists of approximately 8000 generic products and 258 firms with manufacturing capability, along with some imported patented products. (The Daily Star March 07, 2016)

D.    Business nature:
1. High-End products (Anti-Cancer, Insulin, Vaccines etc.)
These are essentially products specific to market niches, i.e. Anti-cancer, Diabatic products, Vaccines etc. these products are usually high priced and represent a small portion of the market. Profit margin in such products is very high. Recently, domestic firms have been entering into this field, and competition is expected to drive prices and import dependency down.
2. Branded generics (Anti-Gastric, Anti-Biotic etc.)
This represents broadest segment of the market, comprising products with relatively stable margin and Brand orientation. This segment is dominated by local manufacturers, and due to high brand loyalty observed in our market, market share of manufacturers is usually moving rarely.
3. Low End generics
This segment is small, often for products with low branding possibility, and price war is most evident here. The number of competitors is very high, and market share of each competitor depends on success of marketing strategy (Ramesh S, Economitimes India).
4. Contract manufacturing (domestic and export)
Locally, this segment is small as almost every firm manufactures its own products. The business usually comes from Health organizations like SMC (Social Marketing Company), UNICEF etc. to provide products such as saline, contraceptives etc.
Presently, a number of top firms engage in contract manufacturing. Competition is very low, as each firm engages based on foreign counterpart relations. Manufacturing technologies and accreditations play a vital role in developing contract manufacturing capability.

E. Export: Export of pharmaceutical products of Bangladesh is still in infancy. But the rate of establishment of pharmaceuticals industries in private sector is increasing and they have already entered the export market with their finished products. In 2000, Bangladesh imported US$84,000,000 worth of medicinal and pharmaceutical products and had negligible exports and some recent statements by industry representatives suggest that exports will increase in the near future. Bangladesh is exporting their pharmaceuticals products to Vietnam, Singapore, Myanmar, Bhutan, Nepal, Sri Lanka, Pakistan, Yemen, Oman, Thailand, and some countries of Central Asia and Africa. It also has a large market in European countries.

F. Import: Bangladesh is importing the medicinal products from different countries, especially from India and China. Different organizations of this country are related to import the pharmaceuticals products and raw materials of pharmaceutical industries. Novo and Medintis are importing maximum amount of these types of products. Other organizations are engaging to import the pharmaceuticals products. They are- Sanofi, Aventis, GSK (now closing operation), Sandoz, Novartis, Roche, Unimed, Servier etc.

G. Foreign Competitions: At the beginning the foreign pharmaceuticals were dominating the market in our country. Still now, Pharmaceuticals industries are facing foreign competition. But our industry is not afraid of this foreign competition. There are many multinational pharmaceutical organizations which have established their plants in Bangladesh and importing their raw materials from abroad. Among these competitors, Roche, Glaxo SmithKline, Novartis are leading. In export market, the Novartis is playing the dominant role.

H. Dumping: Some Indian medicines are sold in the country market at a lower price than Bangladeshi medicines but the medicine of developed countries and their origin country are sold in a competitive price, even in higher price. This creates the barrier to capture the market share by Bangladeshi pharmaceutical industries. Owners of the pharmaceutical companies think that the government should take actions to stop this practice (Ahsan 2011).

I. Problems of Marketing:
• Because of having no sufficient incentives in comparison with their effort, the turnover rate of medical representatives is very high.
• Most of the time costs of marketing hardly affect the price of the medicine.
• Professionalism in marketing is not achieved yet in Bangladesh like other developing countries.
• Lack of proper governmental laws and this implementation the law by the drug administration.
• Unstable political situation and different types of violence.
• Effect of globalization that has increased the competition.
• Smuggled production counterfeit, that’s coming from the neighbor countries.

J. Five important JOB SCOPES in Pharmaceutical industries
1. Pharmaceutical industries (Finished medicines, Active Pharmaceutical Ingredients/APIs, and Excipients Manufacturing industries): In Production, Quality Control (QC), Quality Assurance (QA), Product Development (PD), cGMP Training, Warehouse, Drug Research and Invention, and Technical Services Department (TSD).
2. Pharmaceutical Marketing: Product Management Department (PMD), Medical Services Department (MSD), Sales Promotion/Medical Promotion, Clinical Services, Training for field forces, and International Marketing (IM) departments.
3. Drug Testing Laboratories (Dhaka and Chittagong)
4. Research & Development in Pharma industries, educational and research institutes (Research for new drug molecules, Novel Drug Delivery Systems, Improved Healthcare, Clinical aspects, etc.)
5. Hospital Pharmacy

K. Key points of National Drug Policy of 1982
• To provide administrative and legislative support for ensuring quality of essential drugs which are relevant to the national health need.
• To reduce the price of medicine by ensuring the lowest competitive price.
• To eliminate non-essential medicine from the market.
• To promote production of local drug and raw materials.
• To develop proper drug monitoring and information system to prevent wasteful misuse and to ensure the proper utilization of the drugs.
• To ensure GMP and qualified pharmacist in manufacturing companies.
L. Some major characteristics of BD drug marketing sector:
• Their distributional channel includes invoice system, own distribution channel.
• Medical representatives are the key persons in marketing.
• For promotion, the groups such as doctors, surgeons are targeted.
• Major promotional strategies include printed promotional materials, physical sample, and clinical materials.
• Special incentives are given to the doctors. For example, the doctors are given honeymoon packages, the cost of which is borne by the pharmaceuticals.
• The field level executives are playing the imperative role for marketing division. Basically, they have taken the responsibility to market the products of their companies. So, the success of a pharmaceutical industry intensively depends on the efficiency and effectiveness of the medical representatives. If an organization wants efficient employees in this section, he should to satisfy these representatives. (Ahsan 2011)

M. API Business: In Bangladesh, companies have only recently entered API business. At present, there are 21 companies in Bangladesh manufacturing 41 APIs. Industry participants claim already becoming self-sufficient in some APIs, namely, Penicillin, Cephalexin, NSAID and Anti-Pyretic. The production of APIs is confined to the last stage of Synthesis. Presently, Local APIs take a 20% share in domestic production. The rest 80% is imported. These imported APIs represent majority of raw materials import by Bangladesh, approximately 70%. But the overall production is very low compared to total demand. While the industry is achieving self-sufficiency, it yet procures 90% of raw materials from 98 indenters around the world as only one company (Active Fine Chemicals) produces raw materials independently. There are 3000 valid sources of raw materials including countries like China, India, Korea & Italy. API consists a significant percent of total cost in medicine which can run up to 30-40%. At present, only a few companies – Square, Beximco, Ganasastha Pharmaceuticals, Globe and Active Fine – are manufacturing raw materials for drugs like paracetamol, amoxicillin, flucloxacillin, ampicillin and metformin, on a limited scale. Ganashastha Pharmaceuticals Limited (GPL) alone accounts for about 60% of the raw materials manufactured in Bangladesh. Bangladesh is trying to establish an industrial park for pharmaceutical production. One such park in Munshiganj near Dhaka is nearing completion and it might result in a big jump in the income from pharmaceutical exports. A National Control Laboratory Project is taken by the govt. for facilitating the pharmaceutical sector. The proposed API technology Park in Munshiganj, which was scheduled to be completed by July 2012, is delayed with the cost of the project now increasing by 55%. This delay has been a major hurdle for the pharmaceutical industry to gain better control over the inputs and improve operational efficiencies. India, the major generic drug player, has more than 3500 Drug Master File (DMF) approval for APIs whereas we have none (Pratik 2015).

N. Access to essential drugs:  Although official documents indicate that 80 per cent of the population has access to affordable essential drugs, there is plenty of evidence of a scarcity of essential drugs in government healthcare facilities. One study conducted in four district hospitals and one medical college hospital showed that only eight per cent of patients received the prescribed medicines from these facilities. In another report, two major hospitals in the capital city of Dhaka were operating without essential medicines for eight consecutive weeks. There are countless such incidents relating to the supply of essential medicines in Bangladesh. In most such cases, government officials and health professionals are responsible for the shortage as they often sell government-supplied drugs to local drug stores instead of dispensing them to poor patients. The government must be cognizant of this fact, but rarely takes any action.

O. Quality of available drugs:  Of the 300 pharmaceutical companies in Bangladesh, only the 20 to 25 top ones produce drugs of standard quality. Reports show that numerous small companies’ market substandard drugs in the country. Fake or substandard medicines, including lifesaving ones, with an estimated worth of US$ 150 million per year, are flooding the domestic market. In its annual testing in 2004, the government laboratory detected 300 counterfeit or very poor-quality drugs out of 5,000 drug samples. A recent assay involving 15 brands of ciprofloxacin showed that 47 per cent of samples contained less than the specified amounts of the active ingredient. Another report noted that 69 per cent of paracetamol tablets and 80 per cent of ampicillin capsules produced by small companies were of substandard quality. Good manufacturing practice (GMP) is a major criterion to maintain standard quality in drugs, and it was one of the principal objectives of the NDP to ensure standard manufacturing practices for drug manufacturers. But there are some 265 pharmaceutical companies in Bangladesh that do not follow or comply with GMP. It is widely alleged that adulteration flourishes in the country because of poor government vigilance and supervision over drug manufacturers and sellers. Unfortunately, a section of corrupt physicians and government officials is involved in these underhand dealings. The government states that it has limited manpower and facilities to cope with the country’s fast expanding pharmaceuticals sector. In fact, the regulatory authorizes have given scant attention to quality matters in Bangladesh.

P. Lack of control over drug prices:  In Bangladesh the maximum retail price (MRP) of every essential drug is fixed by the Directorate of Drug Administration (DDA); for all other drugs the DDA endorses the companies’ quoted prices. Drug prices are quite high in Bangladesh in comparison to neighboring countries. The drugs control authority is apparently reluctant to negotiate with the companies to fix prices. The regulatory authorities have virtually no control over drug prices in Bangladesh. Indiscriminate pricing can be observed in all therapeutic classes of drugs. For example, prices of various ciprofloxacin brands range from Taka (Tk) 5 to 14 (US$ 0.07 to 0.20) per unit. The price of dexamethasone eyedrops extends from Tk 24 to 90 (US$ 0.34 to1.29) per 5ml, and diclofenac eye drops are available at a price range from Tk 40 to 200 (US$ 0.57 to 2.86) per unit. These are a few of the existing price discrepancies in the country. Easy excessive profits made pharma companies reckless and making misleading statements implicating of Dollar Taka conversion rate as a reason for increase price. As a counter misinformation, continuously propagating that pharma exports will soon overtake garment export. Present pharma export is not even 1 percent of total national export.

Q. Patterns of drug use:  To ensure rational and appropriate use of drugs in Bangladesh was another prime concern of the NDP. But there has been no drug use study in the country. Clinically inappropriate and inefficient use of medicines is a serious problem. More than half the medicines in Bangladesh are inappropriately prescribed, dispensed or sold. Despite legal prohibitions, numerous drugs with similar or no significant benefits are available in the market. As a specific example, there are seven members of the angiotensin-converting enzyme (ACE) inhibitors available in the country. The efficacies and chemical structures of these molecules are more or less similar, but their price vary significantly. The drug policy clearly prohibits the production of multi-ingredient preparations of vitamins and minerals with the exception of B-complex vitamins. But a mixture of 32 vitamins and minerals including selenium, vanadium, molybdenum, tin and many other unnecessary ingredients has been marketed in the country for a few years, violating the principles of the NDP. The need for these trace elements in Bangladesh is not established whereas nutritional deficiencies are mainly related to vitamins A and B-complex, iron, calcium, iodine and zinc. Irrational prescription and use of antibiotics are rampant throughout the country, with an estimated half of all antibiotics being sold without prescriptions. Self-medication is widespread, and all types of medicines can be purchased without a prescription. There are about 30,000 illegal and 80,000 unlicensed drug stores operating in the country. It is alleged that both legal and illegal drug dealers are engaged in selling fake, smuggled and adulterated medicines in the country (Mohammad 2008).



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