Although the country's pharmaceutical sector is often credited -- and rightly so -- for its commendable performance, one of the difficulties deterring its growth is the overwhelming reliance on imported raw materials, known otherwise as APIs (active pharmaceutical ingredients). Currently, the industry imports 95 per cent of its APIs, amounting to Tk 45 billion. Local APIs producers are not in a position to meet more than 5.0 per cent of the industry's needs. Reducing reliance on imports has been an issue of discussion from sometime now, but with no mentionable progress. Lately, however, efforts are afoot to significantly increase local production of APIs and thus reduce dependency on imports. A project is being implemented to set up an API Industrial Park in Munshiganj. Two other API parks are also being built in Bagerhat and Khulna under private arrangements. A draft API policy designed to incentivise the sector in a meaningful way is awaiting government's nod. The idea is obviously to boost production of drugs and medicines for domestic consumption as well as exports with lowered production cost.
Sustaining a highly capital-intensive industry like the pharmaceutical can only be expected to be viable in the long run if backed by smooth and affordable sourcing of raw materials. A great deal of the unrealised potential of the sector is often traced to the absence of ready-stock locally. It is here that the need for backward linkage is not only important but a foremost prerequisite for desired growth of the industry.
The atmosphere for generic drug manufacturing in the country is chiefly characterised by patent waiver that makes Bangladesh a unique place for manufacturing drugs. The landmark decision of the Nairobi Ministerial Conference of the World Trade Organisation (WTO) exempted Bangladesh, like other least developed countries (LDCs), from fulfilling patenting requirements until at least 2033. This means for another 14 years, the country's drug manufacturers are free to continue with manufacturing generic products without having to pay hefty licence fees to the patent owners. This, no doubt, is the most reassuring news for Bangladesh's pharma sector. Certainly, the benefit is not just for the local manufacturers but also for foreign investors. It is highly likely that a proactive API policy would attract foreign investors who would be eager to gain fruitfully from the waiver.
The country's pharma industry today produces medicines almost to the level of self-sufficiency -- around 98 per cent of domestic demand. The current annual growth of the sector is estimated to be more than 24 per cent. There are 240-plus registered pharmaceutical companies in the country, and a number of them are engaged in manufacturing APIs and a wide range of formulations covering major therapeutic categories. This being the broad scenario, the industry appears to be well set to embrace modern innovations and research on an extensive scale. For this to happen, all that is required is the right push to facilitate production of APIs.
