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Exclusive Interview

Rising costs, regulatory hurdles impacting pharmaceutical sector

BAPI Vice President tells

Published : Tuesday, 4 February, 2025 at 12:00 AM  Count : 350
Shamsul Huda
Md Harunur Rashid, Vice President of Bangladesh Association of Pharmaceuticals Industry (BAPI) and Managing Director of Globe Pharmaceuticals Limited said the industry is facing multifaceted challenges amid opportunities.

Rashid, a seasoned industry expert, painted a vivid picture of an industry at a crossroads saying it is struggling with rising costs, regulatory inefficiencies while there is an urgent need for innovation in the industry to remain competitive on global stage.

Rashid began by highlighting the stark contrast between the export and local markets. While exports have shown promising growth, the local market is under severe strain due to rising import costs, driven by devaluation of Taka and soaring dollar prices.

"This has created an arduous environment for manufacturers who rely heavily on imported raw materials," he explained. The economic pressures have been relentless, with raw material and fuel costs surging by up to 40 per cent over the past year.

Gas prices have skyrocketed to Tk32 per unit, while electricity costs have more than doubled, jumping from Tk10 to Tk22 per unit. These spikes, combined with rising transportation fees, have placed immense pressure on manufacturers to balance operational costs with competitive pricing.

He said despite a 40 per cent increase in wages, pharmaceutical product prices have remained unchanged, limiting investment in research and development.

"Without adequate funding, we risk falling behind in the global arena, compromising our ability to produce new and effective medications," he warned.

This stagnation threatens the sector's long-term growth and its ability to innovate, particularly as global competitors advance rapidly.

Rashid also expressed frustration with the regulatory environment, particularly the slow registration process at the Directorate General of Drug Administration (DGDA). Frequent leadership changes within the organization have disrupted continuity and expertise, further complicating product registration.

This inefficiency poses a significant challenge as Bangladesh approaches the year 2026 deadline, when it will lose its Least Developed Country (LDC) status. Post-2026, companies may face difficulties entering new markets and could incur royalty payments, adding to their financial burdens.

When questioned about profitability, Rashid dispelled the misconception that the pharmaceutical sector is highly lucrative. He revealed that many companies, including Globe Pharmaceuticals, struggle to maintain profitability due to high import costs and inability to pass these expenses onto consumers.

"Local pharmaceuticals prices are often lower than those in India, despite our reliance on imported raw materials," he noted. This disparity underscores the sector's vulnerability and the need for strategic interventions.

Rashid emphasized the government's critical role in supporting the industry, which meets 98 per cent of local demand and serves as a vital import substitute. He called for full functioning of API Park to facilitate the production of Active Pharmaceutical Ingredients (APIs), essential for drug development.

"By investing in this infrastructure, we can ensure the growth and sustainability of the sector," he asserted.

He also urged policymakers to create a more supportive environment, including tax incentives and streamlined regulations, to foster innovation and competitiveness.

Looking to the future, Rashid underscored the importance of advancing biological products and next-generation medications. Biologics, which account for 40 per cent of the global pharmaceutical market, represent a critical frontier for Bangladesh.

"We must invest in the technology and infrastructure to produce these drugs, or risk falling behind the curve," he stated. He also highlighted the need for collaboration between the public and private sectors to address emerging health challenges and capitalize on new opportunities.

Rashid's vision for the sector is one of resilience and adaptation. "We must collectively address these challenges and work towards creating a supportive policy environment that fosters growth and innovation," he said.

"By fostering a shared commitment and resilience, we can navigate the upcoming challenges and continue to thrive in the global pharmaceutical market."

As Bangladesh's pharmaceutical sector faces mounting pressures, Rashid's insights underscore the urgent need for strategic action. With the right policies and investments, the industry can overcome its challenges and secure its position as a key player in the global market.



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