Sales of generic drugs in Bangladesh will treble to Tk 30,300 crore a year by 2024, thanks in part to the recent extension of the medicine patent waiver, which will make quality products more accessible.
On November 6, the WTO-TRIPS Council granted the least-developed countries an exemption until 2033 from obligations to implement patents and data protection for pharmaceutical products.
The development means the local pharmaceutical sector, which stood at Tk 11,000 crore last year, is in good stead to register a compound annual growth rate of 10 percent in local currency terms and 8.9 percent in US dollar terms, said London-based BMI Research.
Owned by the Fitch Group, BMI Research provides macroeconomic, industry and financial market insights.
Experts say Bangladesh has formidable supply-side capacity in pharmaceuticals with 160 small, medium and large enterprises and is capable of catering not only to the sizeable domestic market but also the export markets.
At present, the local industry accounts for 95 percent of the domestic demand.
Bangladesh exports about 500 pharmaceutical items, including active pharmaceutical ingredients and a wide range of pharmaceutical products covering all major therapeutic classes and dosage forms, to about 100 countries.
Pharmaceutical exports rose 11.02 percent year-on-year to $26.7 million in July-October, according to the Export Promotion Bureau.
In 2014, the global pharmaceutical export market was estimated to be worth more than $520 billion.
Once Bangladesh graduates out of the LDC status, it will no longer be able to enjoy the preferential treatment. And, it is highly likely that the country will graduate from the LDC group by 2024.
The window of opportunity for Bangladesh is, thus, only for about 10 years, according to the Centre for Policy Dialogue, a think-tank.
In that timeframe, about 30 world-class drug makers can be developed, according to Abdul Muktadir, chairman of Incepta Pharmaceuticals, one of the leading medicine makers and exporters.
Local firms that will benefit include dominant players such as Beximco, Square and Eskayef, said BMI Research.
Muktadir said the country's medicine makers have gone through preparation phase in recent decades in terms of expanding capacity and raising standards, and would be ready to go big within a year or two.
He however looked at the domestic benefit of the patent waiver. “We will be able to provide high-quality drugs at a very low price,” he added.
Bangladesh's goal of growing its pharmaceutical sector by becoming a key medicine exporter to frontier markets has challenges, according to the BMI report.
While there is a latent demand for medicines in the LDCs, transforming these opportunities into revenue growth will be challenging for the Bangladesh pharmaceutical sector.
Underdeveloped healthcare systems are characteristic of LDCs such as Cambodia and Pakistan, and will impinge upon access to pharmaceuticals.
Distribution of medical facilities remains skewed towards the urban economic centres, according to the analysis. The BMI said the greatest commercial opportunities for generic drugs will lie in emerging markets.
“This happens as countries such as China, the Philippines and Malaysia are poised to see significant improvements in healthcare access, on the back of substantial investments into healthcare by the government through the roll-out of universal healthcare.”
In addition, regulatory standards will become stricter. This falls in line with the broader development of the regulatory bodies in these markets.
In November 2015, the China Food and Drug Administration had rejected the applications of 11 pharmaceuticals with inadequate or suspect clinical trial data.