Bangladesh. Pharmaceutical Industry Overview

In Bangladesh Pharmaceutical sector is one of the most developed hi tech sector which is contributing in the country's economy. After the promulgation of Drug Control Ordinance - 1982, the development of this sector was accelerated. The professional knowledge, thoughts and innovative ideas of the pharmacists working in this sector are the key factors for this development. Due to recent development of this sector we are exporting medicines to global market including European market. This sector is also providing 95% of the total medicine requirement of the local market. Leading Pharmaceutical Companies are expanding their business with the aim to expand export market. Recently few new industries have been established with hi tech equipments and professionals which will enhance the strength of this sector. There are several sectors on which Bangladesh can be proud of and undoubtedly the pharmaceutical sector is one of these sectors, rather it is the sector, which is the second-largest contributor to the government exchequer. There are about 231 companies in this sector and the approximate total market size is about Taka 76,500 million per year of which about 94% of the total requirement of medicines is created by the local companies and the rest 6% is imported. The imported drugs mainly comprise of the cancer drugs, vaccines for viral diseases, hormones etc.

Bangladesh Pharmaceutical Industry is now heading towards self-sufficiency in meeting the local demand. The industry is the second highest contributor to the national exchequer after garments, and it is the largest white-collar intensive employment sector of the country. There are about 460 generics registered in Bangladesh. Out of these 460 generics, 120 are in the controlled category i.e. in the essential drug list. The remaining 340 generics are in the decontrolled category, The total number of brands /items that are registered in Bangladesh is currently estimated to be 5,300, while the total number of dosage forms and strengths are 8,300. Bangladesh pharmaceutical industry is mainly dominated by domestic manufacturers. Of the total pharmaceutical market of Bangladesh, the local companies are enjoying a market share reaching around 75%, while the MNCs are having a market share of 25%.

During the last two decades the pharmaceutical industry of Bangladesh has been taken a newer height. Besides meeting the 94% need of local demand we are exporting the medicines into 77 countries. This sector contributes a lot into the national economy by exporting raw materials and finished goods. Bangladesh is ready to enter the Highly Regulated Market. For this reason different pharmaceutical companies are investing to build high tech pharmaceutical industries. Some renowned companies have already entered the Highly Regulated Market and got the UK MHRA, EU, Philippines, TGA Australia and GCC approval and some are in the process to get the USFDA & UK MHRA approval. Through this accreditation these companies will be able to export medicine and through contract manufacturing agreement.

Domestically, Bangladeshi firms generate 82% of the market in pharmaceuticals; locally based MNCs account for 13%, and the final 5% is imported. Although 235 pharmaceutical companies are registered in Bangladesh, only about 80 are actively producing drugs. The top 30 to 40 companies dominate almost the entire market; the top 10 hold 70% of domestic market share; and the top two, BEXIMCO and SQUARE, capture over 30% of the market (Chowdhury 2006). The industry structure is relatively concentrated. In comparison, the top ten Japanese firms generated approximately 45% of the domestic industry revenue in 2006, while the top ten UK firms generated approximately 53%, and the top ten German firms generated approximately 60% (IMS Health 2006).

Source: Masters of Business Administration, BRAC University