Pharma industry grew with policy support, needs it again to survive: BAPI secretary general

About 98% of Bangladesh's medicine demand is met by local manufacturers. But the rising dollar rate, inflation, and other issues are creating serious challenges for the pharmaceutical sector.

Dr Mohammad Zakir Hossain, managing director of Delta Pharma Ltd and secretary general of the Bangladesh Association of Pharmaceutical Industries (BAPI), says strong policy support is needed to solve these problems. In an interview with Tawsia Tajmim of The Business Standard, he talks about the industry's challenges, the impacts of LDC graduation, and the policies needed for future growth.

What is the current state, and what are the challenges in the pharmaceutical sector?

When the Drug Policy was introduced in 1982, Bangladesh's pharmaceutical sector was at a very early stage. But over time, entrepreneurs took initiative. We had trained pharmacists, government policy support, and most importantly, a pricing system that ensured both growth and affordability. That's how local companies took over roles that were once fully handled by multinational firms. The Drug Policy, pricing systems, and continued government support laid the foundation.

But this sector changes fast—constant development and upgrades are needed. So, entrepreneurs must keep up. Policy, regulations, and institutions like the DGDA must also stay updated.

Today, Bangladesh meets 98% of its own medicine needs. We make quality drugs at low prices. Local production ensures a steady supply, especially during crises like Covid-19 or global conflicts. For example, during Covid-19, Bangladesh never had a single day of medicine shortage, and we made the first generic version of Remdesivir here.

But now, we are facing many challenges.

The biggest shock has been the fall in the value of the taka—from Tk86 to Tk122–125 per dollar. Most of our raw materials and packaging are imported. If something cost Tk40 before, it now costs Tk60. On top of that, inflation and high bank interest rates of 15–16% are putting huge pressure on the sector. Energy costs have also become a big burden.

How is this affecting the sector's long-term capacity?

The pharma sector needs reinvestment every year for modernisation, building capacity, and meeting standards. But now, company profits have fallen to just 3–5%. After paying taxes and dividends, very little is left for reinvestment.

Over the past 10 years, Bangladeshi pharma companies have slowly lost strength. As a result, they are not reinvesting. Without reinvestment, growth stops—something we have seen for 40 years. Without it, we cannot develop new molecules either.

How does LDC graduation impact this?

As a Least Developed Country (LDC), Bangladesh enjoys the TRIPS waiver until December 2032. After that, we won't be allowed to make patented drugs without paying high royalties. This will raise prices sharply. We have advised DGDA to register patented products now, while the waiver is active, so we can keep making them after graduation. But sadly, those discussions have stopped. If we don't register early, we risk lawsuits and price pressure from global companies.

In 1995, India protected its pharma sector by passing smart patent laws that kept a balance between innovation and affordability. DGDA should register patent-exempt drugs for at least 15 years to help our companies grow. This would give us time to create our own innovations or negotiate better deals with international firms.

The Health Reform Commission has made some suggestions for the pharma sector. What is your view?

I don't agree with some of their ideas. For example, they recommend that doctors should prescribe only by generic names. But is Bangladesh ready for that?

They also suggest that company representatives should no longer meet doctors. But every year, 10,000 to 11,000 new doctors graduate. How will these doctors learn the names of medicines?

Our company has 176 products, and in Bangladesh, there are over 28,000 brands based on different molecules. If representatives send only one email a day to a doctor, do you think the doctors will read them all?

If needed, there can be a fixed time once a week for representatives to visit and talk to doctors.

Our marketing costs are below 6%, not the 25–30% that people often say. Our financial records are audited—not just locally, but also by international agencies like ADB when we take loans. We are fully accountable.

What about the API industry?

Making Active Pharmaceutical Ingredients (API) is very different from making regular medicines. We are still at the early 1980s level in this field. The API Park in Gazaria is too small. Companies that visited API plants in China saw that we need much bigger investments and better facilities.

One API plant needs 8 to 65 processing steps and special machines, which won't fit in the current park. So, a large investment is needed. That's why we must carefully think about whether there is enough market demand.

What do you expect from the government?

The key reason behind the success of our pharma industry was strong policy support from the government. But now, we are facing problems with that same support. Unless these problems are fixed, the pharma sector cannot grow by itself. We are asking the government to implement the Drugs Act that was passed by Parliament in 2023.