Presentation Topic : Problems and Prospect of Pharmaceutical Industries in Bangladesh.

History of Pharmaceutical Industry

The roots of the pharmaceutical industry lie back as far back as the middle ages.

But the industry as we understand it today really has its origins in the second half of the 19th century.

The origins of the Pharmaceutical Industry:The chemical industries (of the late nineteenth century) in

the upper Rhine Valley of Switzerland. The drag store was opened by Arabian Pharmacists in

Baghdad in 754 and many more was opened in Islamic country and Europe .

Arabian pharmacists opened the first documented drugstore:

Most of today's major pharmaceutical companies were founded in the late 19th and early 20th centuries.

Some Others:MAO InhibitorsChlorpromazine (Thomasine)Haldol (Haloperidol)Velum (diazepam)

- discovered in 1960,- marketed from 1963 ,

In 1964 The World Medical Association (WMA) issued its Declaration of Helsinki which set standards for clinical research and demanded

History of Pharmaceutical Industry in Bangladesh

Pharmaceutical Industry has grown in

Bangladesh in the last two decades at a considerable rate. The sector consistently

creates job opportunities for qualified people. Like all other sectors in

Bangladesh, the pharmaceutical industry was much neglected during Pakistan

regime. Most multinational companies had their production facilities in West Pakistan. For several years after

liberation, the government could not increase budgetary allocations for the

health sector. Millions of people had little access to essential life saving medicines.

In 1981, there were 166 licensed pharmaceutical manufacturers in the country. But in spite of having

166 local pharmaceutical production units, the country had to spend nearly Tk 300 million on importing finished medicine products. With the

promulgation of the Drug (Control) Ordinance of 1982 many medicinal products considered harmful, useless or unnecessary which got removed from the

market. In 2000, there were 261 unani, 161 Ayurveda, 76 homeopathic and biochemical

licensed manufacturing units. They produced medicines worth Tk 1.2 billion in 2000. One of the

major positive impacts of Drug (Control) Ordinance is the rapid development of local manufacturing

capability.

Contribution of Pharmaceutical Industry

on Our Economy

• Significant contribution on country's economy.

• Substantial development in pharmaceutical

sector enabled us to export our branded

generics in the international marketing domain.

• Healthy growth is encouraging the

pharmaceutical manufacturers towards research

and development for newer generics of quality

drugs at affordable prices.

• The creation of Active Pharmaceutical

Ingredient Park (API) is one of the most

significant parts of the pharmaceutical

industry as a whole.

• Bangladesh pharmaceutical market is

growing at a fast pace and has a bright

future indeed according to Business

Monitor International's .

Contribution of Pharmaceutical Industry on Our GDP

What is GDP?GDP stands for Gross Domestic Product. Gross domestic product is the market value of all officially recognized final goods and services produced within a country in a given period of time.

Contribution of pharmaceutical industries to GDP of Bangladesh

*exports medicines worth $60 million

FY10 FY11 FY12 FY13 FY14 FY150.00%

1.00%

2.00%

3.00%

4.00%

5.00%

6.00%

Contribution of pharmaceutical industries to GDP of Bangladesh

Problems of PharmaceuticalsIndustry

The Turnover rate of MR is very highCost of marketing hardly affect the price

of the medicineProfessionalism in marketing is not

achieved yet in BangladeshEffect of globalization has increased the

competition.Unstable political situation and different

types of violence .

PROBLEMS OF MARKETING

Problems of Export:Unstable political situation Problems of portIrresponsibility of customs officers

Shortage of powerLack of opportunity to supply the emergency

power

PROBLEMS OF POWER DEVELOPMENT:

Other Problems:Inadequate strength and limited capacity of

DTL & DDABig multinationals may come and take major

marketForeign competitors Illegal entrance of drugsAdvertisement of OTC (over-the-counter)

drugs

Problems of Pharmaceutical Industries in Bangladesh (According

to Experts)

Sales Rate (Core) Company Size

Over 300 Large Company

50-300 Medium Company

Under 50 Small Company

Problems of Medium & Small companies:

Competition:

•Unequal Competition: There are near about 250 Pharmaceutical companies in our country. Among these companies, only 30 companies own the 90% of the whole market share.

•Gross sales: Only 17 companies in our country have a sales rate more than 100 cores.

Following GMP  procedures : If any Pharmaceutical Company want to maintain GMP(Good manufacturing practice), it must have to invest 100 core tk or more.

Customers are Doctor: Large company provide doctors with bonus, and other facilities like luxuries products, where the medium and small company cannot afford it.

Medical representative: Large companies appoint around 1200 medical representative, where medium company appoint 200 -300.

Problems of Large Company

•High cost of marketing products.•High cost of financing.•Turnover rate of medical representatives is very high.

Common Problems of Pharmaceutical Industries in Bangladesh

Manufacturing Problems: lack of Gas & power supply. Companies are not able to provide instant power supply, which hamper the production quality.

Industry Sector: Energy cost of industry is too high.

Bank interest rate: In our country bank loan interest rate is 18-20%. Where in abroad it’s only 3-4%.

Local Problems: •API Support.•Raw materials.•Regulatory body.•Drug tasting laboratory.

Export problems:

•Rule of Bangladesh bank is not in favour of pharma industry. •Advance payment is needed.•Banks are averse to allocate Dollar.•Have to face audit board.

Others:

•Bangladesh Drug Administration is not a global member.•Unethical activities by small company to sustain. •Strike hampers the distribution channel works.

Prospects of Pharmaceuticals Industry in Bangladesh

1. Prospects of Marketing:i) Marketing system is improving in this sector and proper

marketing may help a firm to achieve their goals. ii) For free and fair competitions marketing can play a major

role.iii) Marketing can be regarded one of the most important

weapons to face the challenges of open market economy.

2. Prospects of Foreign competition:i) Foreign competition made the country firms more eligible

to face challenges that arose after the year 2005.ii) The local firms will not face any rigorous problem in

foreign countries as they are accustomed in competition with foreign firms.

3. Prospects of Export:i) For surviving in the future, competitive environment is

necessary.ii) Competition reduces monopolistic attitude of the firms.

As a result the customers will be benefited by getting quality products.

4. Prospects of Customer Choices:i) By increasing quality more customers as well as market

share can be absorbed.ii) By producing rare drugs at home, the country can save

its foreign exchange.iii) By extensive promotional activity, customer choice can

be driven.

5. Prospects of Power Development:

i) By following all the rules and innovating alternative power supply source, this sector is entering the competitive market.

ii) Pharmaceuticals may open a big door of prospect in the foreign market.

Experts’ Recommendation for Pharmaceutical Industry in

Bangladesh:

Providing sufficient gas and electricity according to the demand.

Political stability is very much needed. Due to strike & other political unrests the marketing process is being interrupted & the distribution channel lose their natural speed.

80% of the raw materials of this industry are imported from foreign countries. If the raw materials can be produced sufficiently in the domestic level, the pharmaceutical companies will be able to supply according to the demand.

Upgrading the regulatory body to WHO standard. It will let Bangladesh enter into the global market and thus will increase the production a great deal.

Like India & other competitor countries, bank loan interest rates should be reduced for this industry.

If these recommendations can be implemented, the Pharmaceutical Industry of Bangladesh will be able to shine in its true sense.