Pharmaceutical Export: The fact and challenges that should not be ignored

An analysis
Dr. Md. Moklesur Rahman Sarker
M. Pharm., Ph. D.
Assistant Professor, Dept. of Pharmacy, Primeasia University
Ex-Head, Dept. of Pharmacy, Daffodil International University
Ex-Head, International Marketing, Biopharma Lab. Ltd.

The success story of Bangladesh pharmaceutical sector is very pleasant. It had to travel a long
way to achieve the present prestigious position in domestic and international markets. By
now, 97% of countrys demand of medicines is produced locally 1,2, mainly by national
pharmaceutical companies. The pharmaceutical sector of Bangladesh is expanding rapidly
and some companies have already certified by different international regulatory authorities
like UK-MHRA, Australia-TGA, EU, etc. 2, for quality management and quality products
manufacturing. Moreover, few companies are on the road to achieve US-FDA approval.
According to the information of the Director General of Drug Administration of Bangladesh
(DGDA), there are 263 Allopathic drug manufacturing companies in Bangladesh; 209 of
which are functional, 29 companies are non-functional and 25 companies are suspended in
status3. Pharmaceutical export is contributing to the GDP of the country and every year this
contribution is positively growing4. In the meantime, Pharma sector has become the 2nd
largest potential sector in Bangladesh to earn foreign currency. At present, about 30
pharmaceutical companies have started their export activities4.
The aim of the present article is to analyze the present status of pharmaceutical export and to
discuss some important obstacles, which are greatly hindering the exploration of export, on
the basis of published articles, reports of Bangladesh Association of Pharmaceutical
Industries (BAPI), and experts opinion/interview published in different journals/magazines
on the status, progress, prospects, and obstacles of pharmaceutical sector of Bangladesh.
Present position of Bangladeshi pharmaceuticals in domestic and international markets:

The pharmaceutical sector of Bangladesh is mostly developed in the areas of drug

formulation and manufacturing of finished products, of course some companies have started
to produce active ingredients and also exporting the generic medicines. By now, our locally
produced medicines are exported to 83 countries of the world including the first world
countries like Europe, America, Australia, France, etc.3 In the year 2010, the domestic market
of Bangladeshi medicine was BDT 6990 crore5(Fig. 1), and pharmaceutical marketing experts
expect that this sales figure in the year 2011 may be reached at BDT 9000 crore 1. The export
value of Bangladeshi pharmaceuticals in the year 2010 was BDT 381.35 crore3 (Fig. 2).
Analysis on the present situation of international market:
If we look at the sales achievement in domestic and international market, we can see that the
export value is 18 times lower than the domestic sales. The last four years growth rates in the
domestic pharma market (2007-2010) were reported to be 12.05%, 7.03%, 16.17% and
16.95%, respectively (Fig. 1). On the other hand, the growths of pharmaceutical export in the
last four years (2007-2010) were -6.98%, 32.28%, 5.93% and 9.85% respectively (Fig. 2).
The domestic market is growing every year with considerable growth potential. But the
export market remarkably fluctuated over the last four years. During the years 2008-2010,
pharmaceutical exports were increased positively, although the export volumes were not so
high; inversely, the export sales in 2007 had a negative growth compared to the sales of 2006.
In the year 2010, pharmaceutical sales in domestic market was BDT 6990 crore, whereas, the
export value in the same year was only BDT 381 crore. Thus, in respect of both the sales
volume and growth rate, our domestic market is much healthier than that of international
market. I firmly believe that our pharmaceutical companies are trying their best to achieve a
remarkable export sale in the international markets. Although Bangladeshi pharmaceuticals
are exported to 83 countries of the world, why the sales volume is so negligible? This is
really an important question at this moment. Pharmaceutical and Marketing Experts may
answer and analyze this question in different ways. I think the most suited answer may be:
Bangladeshi companies have explored their export activities in 83 countries and different
countries are in different operation stages. Its true that we could start export activities in 83
countries of the world but, side by side, its also true that still we are on the pipeline to enjoy
the export sales in those countries; this means we have just built our preliminary baseline to

sell huge amount of medicines, its only a matter of time. Actually, pharmaceutical export has
started only few years back. Till now, most of the companies are busy to complete their
formalities in different countries to export, or they have just started to sale drugs in small
volume. Therefore, with the passing of time the export market will be matured and volume
will potentially be increased, many of our experts say: its a matter of time only.
Major obstacles to pharmaceutical export: Steps should be taken
1. Restriction of Bangladesh bank to remit transfer seriously hampering pharmaceutical
export: Bangladesh bank permits to remit maximum 30,000 USD in a year 6. Payment for
company and product registrations, office establishment and maintenance, manpower
cost, marketing expenditure/promotion of drugs, and miscellaneous export related
expenditure becomes much higher than the above limit6,7. The government should really
understand that this barrier is hampering our export activities. Therefore, remit limit for
smooth operation of pharmaceutical export activities should not be imposed. It is worthy
to mention here that BAPI leaders/authority and many business experts urged to the
proper authority of our government, also discussed and urged in different
seminars/meetings to solve this issue in different times, but the problem has not yet been
solved. So, for the shake of pharmaceutical export, the govt. should immediately remove
the restrictions imposed by Bangladesh bank to remit money for export activities.
2. Custom harassment in sending drug sample interrupts export promotion: The customs
authority of Bangladesh imposes lot of restrictions in sending drug samples to the
importing countries. Instead of doing favor they are rather interrupting our normal export
activities. Sometimes they apply many restrictions on giving permission to sending drug
samples, also limit the quantity of samples to be sent, and above all, dont allow sending
drug sample more than BDT 4000 without vat 5. It must be realized that without sufficient
drug samples, no foreign buyers will be interested to buy our products. Besides, for the
testing and promotion purposes, 30-40% samples are required by the importing countries.
Therefore, understanding the reality the custom authority should allow at least 30-40%
samples to be sent to the importing countries without vat.
3. Lack of Bioequivalence test facility in our country is a major limitation of pharmaceutical
export: Bioequivalence study of a product is a must for the registration of that product in
many of the moderately regulated and regulated foreign countries 5. At present, we dont
have any facilities for bioequivalence study. In order to register a product, a
pharmaceutical company has to carry out this test in foreign country by spending of a
huge testing charge (USD 50,000-100,000/product) 8. For this reason, many
pharmaceutical manufacturers dont show interest to register their products in foreign
countries that require Bioequivalence study. It is relevant here to mention that BAPI and
pharmaceutical exporters first felt the necessity of having Bioequivalence test facility in
our country and they proposed and demanded to set up a modern Bioequivalence test
center to the govt. for the promotion of pharmaceutical export. But its a matter of great
regret that still no step has been taken by the govt. It hampers our overall export activities.
The government of Bangladesh should immediately set up an independent modern
Bioequivalence test laboratory in our country to gear up the overall export activities and
to save huge foreign currency that our pharmaceutical companies are currently expending.
Alternatively, our pharmaceutical manufacturers can make an agreement with
International Center for Diarrhoeal Diseases and Research in Bangladesh (ICDDRB)

and/or Bangladesh Council for Scientific and Industrial Research (BCSIR) for
Bioequivalence study with reasonable cost (USD 10,000-15,000/product) (I confidently
believe that from my practical observation that this charge will be ok for Bioequivalence
test of a product in any of the two international organization). These two scientific
organizations can develop enough facilities for Bioequivalence test of drugs if some
companies together/BAPI make an agreement with them. Their test result may be
internationally acceptable.
4. Setting up of API production park may remarkably reduce the production cost of medicines
thus potentiality contribute to pharmaceutical export:

The major advancement of Bangladesh pharmaceutical sector has been occurred in the
production of finished products. At present, we are greatly dependent on import of raw
materials (more than 90% raw materials are imported) for the production of finished
drugs. Although our labor cost, white color labor cost, utility service charges, etc. are very
low compared to any other countries, only because of our dependent on imported raw
materials, the production cost of our finished products become higher than that of India
and China. Thats why, we cant compete with the Indians and Chinese companies to offer
export prize. Hence, the setting up of an Active Pharmaceutical Ingredient (API) plant is
very urgent issue. Due to the claim and urges of BAPI and pharmaceutical business
entrepreneurs, the govt. of Bangladesh has taken an initiative to establish an API near
Dhaka. Long time has already been passed after taking decision of establishing an API
but still the API has not yet come true. Its a matter of hope that the govt. is working to
establish the API park. We would like to thank the govt. to understand its necessity. But
the progress of API is not as rapid as it would be. Unless and otherwise, API has been
established, we would not be able to provide medicines with a reasonable and very
competitive price. Local production of raw materials in API will greatly contribute to our
pharmaceutical export to extend export volume, and also can poterntially contribute to the
countrys economy. We are passing golden times due to patent exemption. We should
utilize this opportunity as many as we can. The government should give vigorous
attention to accelerate all the necessary activities within very short time to complete the
API Park.
5. Country image and production of substandard/fake drugs by some companies hampering
the acceptance of our products to international community: Some small scale companies in
our country are still producing substandard or spurious drugs which damage the overall
image of Bangladeshi products to the international community, thus making our export
difficult9. BAPI can play an important role in this regard by establishing an effective
mechanism by their own arrangement or help the drug controlling authority - Directorate
General of Drug Administration (DGDA) or other controlling authority of the government
to control the production of fake/substandard/adulterated/spurious drugs. The government
and the drug control authority should strictly control the manufacturing of spurious or
substandard or adulterated drugs to maintain a clean image of Bangladeshi products home
and abroad as well as for the health safety of the nation.
6. Lack of a modern drug testing laboratory in our country is a major limitation of
drug control authority of Bangladesh that also affects pharmaceutical export: We
dont have a modern, well equipped drug testing laboratory (DTL) with the engagement
of sufficient and skilled pharmaceutical scientists. Due to lack of this, our drug control
authority cannot monitor the quality of drugs manufactured by different pharmaceutical

companies in Bangladesh. Moreover, foreign buyers and regulatory authorities raise

question about the status of our drug testing laboratory, the central quality monitoring
facilities of drug authority of Bangladesh. Our existing drug testing laboratories need
massive improvement in this respect. The govt. should immediately do the necessary
work to establish whether a modern DTL or National Control Laboratory (NCL) with
sufficient skilled manpower to monitor the quality of drugs manufactured by different
pharmaceuticals.
7. The regulatory authorities of importing countries are not satisfied with the status, activities
and documents of drug administration of Bangladesh: The documents provided by the
Drug Administration of Bangladesh are not impressive; represent the poor status of drug
regulatory authority of Bangladesh to the business community and to the regulatory
authorities of importing countries. Besides, the website of DGDA is still lacking lot of
necessary and up to date information, required and inspected by the business partners and
regulatory authorities of importing countries. The website should be updated regularly. It
is noteworthy to mention here that export of medicine is not as usual as other products
like RMG, leather, etc. The importers and regulatory authorities of medicines have a lot
of queries and technical aspects to know to assure the quality of medicine and reliability
of their business. The present status of DGDA website is better than the previous time and
many aspects have been developed and included. Yet, many more things have to do to
make it suitable for international business.
8. Medicine export should be emphasized to LDCs than any other countries : Some companies
are aggressive to enter the highly regulated overseas markets, such as, USA, Australia,
Europe, Canada, France, and Golf countries. But the practical observation is that getting
export status to those countries requires huge investment in the manufacturing plant to
achieve certification from different international drug regulatory authorities, highly
sophisticated documentation, and huge initial capital investment. I think the main reason
of this attitude is to achieve high quality status of the company that uplifts the dignity of
the company to our national and international markets. Actually the export volume to the
highly regulated countries will not be easily feasible; rather we can perform pretty good
and can potentially increase our export if the our exporters become more attentive to
LDCs. Among 50 LDCs, only Bangladesh has its strong fundamental and modern
manufacturing base, hence we can easily share the drug market of rest of the LDCs. So,
considering the practical situation, the LDCs should be the targeted markets of our
pharmaceuticals, of course, side by side, moderately regulated and highly regulated
markets may be explored gradually. However, we can establish joint-venture, tool
manufacturing, and contract- manufacturing business with the companies of developed
countries, not only for exporting medicines.
9. Establishing Export cell by the govt./private Consultancy firms may promote pharma
export: Government can establish specialized Export Cell to promote exports of
pharmaceuticals to grab and capitalize the huge export opportunities in LDCs 8 Some
private Consultancy firms having experience and expertise in drug export professionally
can be engaged to assist the pharmaceutical companies who do not have the technical and
expertise know-how to go through the entire process of export, or have lacking in
documentation skills or even do not have the skilled man power to deal with the drug
export. Thus, Consultancy firms can play a significant role to explore export to maximum
countries, accelerate export activities, and to reduce the overall cost of export. Even some
small companies having International Marketing Department (IMD) can explore the

benefits of outsourcing by hiring Export Consultants to reduce its overhead expenditure

and make a comparative study of cost-benefit ration to justify having IMD.
What may happen in the fate of pharmaceutical export of Bangladesh after 2016?
As a member country of LDC, Bangladesh is enjoying waiver from patent law enforcement
which will continue up to 2016. By virtue of this opportunity, our companies can manufacture
patented drugs without giving any payment for patent right, thus it is now possible for us to
produce any patented drugs at very low price and can export to other countries. For this
reason, a Bangladeshi company would offer export price to an LDC much lower than could
do a company from India, China or other countries where patent right implemented. In this
sense, Bangladesh is passing a golden time for export of patented drugs in other LDCs. Yet,
our export price is not as lower as it would be compared to India and China, because we are
not yet independent to our raw materials and other materials required for the production of a
finished medicine. Still, we have to import more than 95% of active ingredients and
excipients of medicines. This is still a great drawback for the achievement of our
pharmaceutical export. If patent right is enforced in Bangladesh after 2016, the production
cost of medicines will remarkably be increased, thus it would not be possible for us to
compete with the offer price of India and China, thus our export market drastically will be
reduced, because the pharma market in LDCs will be opened for all and we will have to face
great challenges for our existence in global market. But fortunately, if the patent waiver is
extended for another 10 years, we can really enjoy the taste of patent exemption at that time
because our pharma sector will be almost self reliable within that period.
Conclusion:
The pharmaceutical sector has already been declared as the thrust sector by the government
of Bangladesh. Bangladesh has built a strong baseline and going towards the self-sufficiency
for the production of medicine. Meanwhile, some companies have started to produce vaccine,
insulin, anticancer drugs, etc. Our pharmaceutical industries are success in domestic market.
Now, its the time to grow our international market because we passing golden time getting
the opportunity of patent exemption by the TRIPS until 2016. In this article, I have discussed
the urgent issues need to give intimate attention immediately. Besides the above discussing
points, providing cash incentive by the govt. to the medicine exporters, like RMG may
encourage pharmaceutical exporters. International fair arrangement by Export Promotion
Bureau (EPB) is a very effective way to search buyers and to establish business in a new
country. A lot of initiative have been taken by BAPI in different times, such as, high level
pharmaceuticals delegation team visited foreign countries to explore export initiated by
BAPI. This organization also upheld the demand and urged to the government and other
concerning authorities for API Park, Bioequivalence test laboratory, Central drug testing
laboratory, cash incentives, problems in remit transfer and sample sending etc. But many
issues are yet to resolve. We have already wasted our valuable time and still loosing to build
our infrastructure for export. We should complete our infrastructure as soon as possible
because TRIPs patent protection may be adopted to us after 2016. The government should
really be attentive to remove all the obstacles and solve all the problems to see
pharmaceutical sector as a vital player in international market.

References:
1. Bangladesh Association of Pharmaceutical Industries (BAPI) report, 2011: Current
Progress and Future Challenges of Bangladesh Pharmaceutical Market.
2. Dr. Md. Moklesur Rahman Sarker. Export opportunities in LDCs. The Pharma World,
Vol. 2, No. 17, pp. 55-56 (2010).
3. Directorate General of Drug Administration, Ministry of Health and Family Welfare,
Government of the People`s Republic of Bangladesh; Web: www.dgda.gov.bd; accessed
on 20 March 2012.
4. The Pharma World interview with the Managing Director of Novelta Bestway
Pharmaceuicals Ltd., Vol. 2, No. 17, p. 65-66 (2010).
5. Aminur Rahman. Bangladesh Pharmaceutical Market: Change Paradigm. Asia Pharma
Expo -2011 Event Catalogue; Bangladesh Association of Pharmaceutical Industries.
6. The Pharma World interview with S. M. Noor Hossain, General Manager, Marketing, of
Aristopharma Ltd., Vol. 2, No. 17, p. 61-63 (2010).
7. The Pharma World interview with the Marketing Manager of Incepta Pharmaceuticals
Ltd., Vol. 2, No. 17, p. 54 (2010).
8. Bangladesh Association of Pharmaceutical Industries (BAPI) proposal and probable
solution, 2011: The change, correction and extension of export policy 2009-2012.
9. Dr. Md. Moklesur Rahman Sarker. Excipients-based pharmaceutical industries in
Bangladesh may be a prospective and effective step towards the achievement of selfsufficiency of Pharmaceutical Sector. Asia Pharma Expo -2011 Event Catalogue;
Bangladesh Association of Pharmaceutical Industries.