FE Report
Bangladesh's move to facilitate local pharmaceutical companies in manufacturing bulk drugs may affect Indian medicine exports, according to an Indian media report.
The report published by Livemint.com on Tuesday focused on Bangladesh's policy to support local industry to manufacture active pharmaceutical ingredient (API) and laboratory reagent.
On May 24, Bangladesh announced a corporate tax holiday for API and laboratory reagent manufacturers till 2032, as well as many incentives to encourage local manufacturing of drug ingredients, said the report.
These steps aim to boost pharmaceutical exports and lower the cost for domestic consumers.
In the absence of local APIs, Bangladesh relies on imports from China, South Korea and India.
"With backward integration of API and finished formulations production, Bangladesh could emerge as an important supplier, especially for new medicines that are patented in India and cannot be supplied by Indian generic suppliers," said Leena Menghaney, head of South Asia, MSF Access campaign.
India's pharma exports grew 2.91 per cent to US$17.27 billion in 2017-18, according to the Pharma Export Promotion Council.
But experts claim that exports will be severely hit in the long run if the country does not upgrade, the Livemint report said.
It said Bangladesh can boost its pharmaceutical exports on the back of a patent waiver available to the least developed countries until 2032.
"Bangladesh is a small country compared to India. However, their presence in the global scenario in formulations as well as in API industry is phenomenal," said BR Sikri, president of India's Federation of Pharma Entrepreneurs.
"In a short span of a couple of years, they have started exporting to more than 80 countries. If this tempo continues, it will be a big competition to India," he added.
Contacted, Bangladesh Association of Pharmaceutical Industries (BAPI) advisory committee member Abdul Muktadir said, "I don't have details about the policy, but I know that the government will give cash incentives against export."
Responding through an e-mail, he told the FE that India would lose some exports to Bangladesh, but they will benefit by exporting intermediate items that are required for manufacturing bulk drugs.
Mr Muktadir, also the chairman of Incepta Pharmaceuticals Ltd., said the country will become more independent in API as some of the factories in the API Industrial Park will start producing in two to three years of time.
BAPI secretary general SM Shafiuzzaman said local industries meet 98 per cent of domestic demand for medicine.
However, 97 per cent of the raw materials required to produce these medicines are imported, he said.
The country's pharmaceutical industry imports at least 75 per cent of the APIs from China and India, he added.
"We are very hopeful that with the initiation of the API Park, local industry would be able to meet 15 to 20 per cent of demand for API and laboratory reagents," he told the FE.
Bangladesh Small and Cottage Industries Corporation (BSCIC) has been building the API Park by the Dhaka-Chittagong Highway under Gazaria upazila of Munshiganj.
The industrial park is expected to be complete by June 2020.
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