Pharmaceutical Industry of Bangladesh: Prospects and Future Challenges

Pharmaceutical Industry of Bangladesh

The pharmaceutical industry in Bangladesh is moving forward with great potential as 98% of the country’s total demand for medicine is being met by domestic institutions. In addition to meeting the domestic demand, the companies also export medicines to several countries of the world. In the fiscal year of 2019-20, Bangladesh’s pharmaceutical export revenue was 136 million. Besides, Bangladesh ranks 71st out of 134 countries in the world in terms of global pharmaceutical exports. Apart from allopathic medicines, Bangladesh also produces homeopathic, unani, and ayurvedic medicines. At present, there are about 257 pharmaceutical companies in Bangladesh which manufacture about 80 percent of generic drugs. At present, domestic companies like Square, Beximco, Reneta and Opsonin are dominating the pharmaceutical market in Bangladesh. 

Industry Overview

The pharmaceutical industry in Bangladesh began in the 1950s in the hands of some MNCs and local firms. After independence in 1971, Bangladesh, as a least developed country, got patent exemption in the pharmaceutical industry under the British Patents and Designs Act, 1911. As a result, the production of generic medicine in the country began to increase. However, the growth of the pharmaceutical industry began in the 1980s. In 1981, there were 166 licensed pharmaceutical factories in Bangladesh. However, the country’s pharmaceutical production was then dominated by 8 multinational companies such as Glaxo, Pfizer, Hoechst and they supplied 75% of the country’s medicine. At that time, 25 medium-sized domestic pharmaceutical companies produced 15% and 133 companies produced the remaining 10%. All these companies used to make medicines locally from raw materials imported in foreign currency worth BDT 60 crore annually. Despite having 16 local pharmaceutical companies in the country, medicines worth BDT 30 crore were imported from abroad every year.

The pharma value chain of Bangladesh is basically divided into two parts. One is Active Pharmaceutical Ingredients or API, and the other is Finished Formulation. API basically refers to medicines with specific active ingredients for specific diseases. Finished Formulation, on the other hand, basically refers to the medicine prepared by mixing different chemicals along with Active Ingredients.

In March 1982, the government formed an expert committee to develop a drug policy. The committee formulates policies for both the formulations sector and the API sector. However, the then government only allowed the issuance of Drugs (Control) Ordinance for the formulations sector, and two more new rules were enacted in June. One was to ban the manufacture, import and sale of unnecessary and harmful drugs, and the other was to ban the products of MNCs which did not have their own manufacturing plants in the country. According to a report by Sudip Chaudhuri, EVOLUTION OF THE PHARMACEUTICAL INDUSTRY IN BANGLADESH, Bangladesh did not repeal any of the rules, even though the US government at the time pressured them to do so. However, at that time, out of 4340 registered medicines, about 1700 medicines were banned and removed from the market. This gave MNCs a chance to reorganize their operations, but a number of organizations, such as Squibb had to shut down their operations in Bangladesh. In 1995, Bangladesh signed the TRIPS agreement with the World Trade Organization. Bangladesh, as one of the least developed countries, received the benefit of manufacturing and marketing medicines without patents. As a result, Bangladesh can produce medicines at lower costs, making the price of medicines much lower at the consumer level, which was very important for an underdeveloped health sector like Bangladesh. Initially, the agreement was valid till 2005, but it was later extended to 2016. This agreement was later extended again till 2033. This facility accelerates the growth of the country’s pharmaceutical industry. 

pharmaceutical sector of bangladesh

With a market value of about 3 billion, it currently accounts for about 1.83 percent of Bangladesh’s GDP that contributes to the country’s pharmaceutical industry. According to a report by the Directorate General of Drug Administration (DGDA), there are currently 257 licensed pharmaceutical factories in Bangladesh. From which, 150 factories are continuing to operate as usual, meeting about 98 percent of the total demand of the country. At present, 90% of the country’s total pharmaceutical market is under local manufacturers and the remaining 10% is under multinational institutions. Bangladesh currently manufactures more than 450 generic drugs for 5,300 registered brands as well as meet the demand of 4% of the country’s anti-cancer drugs. About 80 per cent of the medicines currently manufactured in Bangladesh are generic drugs, and the remaining 20 per cent are patented drugs.

Over the past five years, the pharmaceutical industry in Bangladesh has been growing at a CAGR of 15.6% every year. In 2018, the pharmaceutical market size of Bangladesh was about 2.42 billion dollars, which increased to 3 billion dollars in 2019. According to a finding by ResearchAndMarkets, the pharmaceutical market size will see a growth of 114% and will reach more than 6 billion dollars by the year 2025. In addition, Bangladesh has been able to earn 136 million in the 2019-20 fiscal year by exporting medicines to about 147 countries around the world. At present, the pharmaceutical industry in Bangladesh is trying to capture about 10% of the world market. 6 organizations of the country have already been able to get approval from the top regulatory bodies like World Health Organization (WHO), WTO, and WIPO.

Major Players

Names of the companies like Square, Beximco and Incepta must surface as among the major players in the pharmaceutical industry of Bangladesh. Square Pharmaceuticals is in the leading position in the pharmaceutical industry with about 16% market share on the basis of revenue. Incepta is in the second position with 10.21%, Beximco is in third with 8.39 % and Opsonin is at fourth with 5.54% market share. In the 2018-19 financial year alone, Beximco Pharmaceuticals’ export earnings amounted to 32.46 million and Square Pharmaceuticals’ export earnings for the 2018-19 fiscal year amounted to 19 million. By setting up their manufacturing plant in Kenya, Square Pharmaceuticals have become a multinational company. 

Revenue Growth Drivers

The revenue of the pharmaceutical industry of Bangladesh is mainly generated from domestic sales and exports. There are several reasons behind the current growth of the pharmaceutical industry in Bangladesh in terms of revenue.

Economic Growth

At present, the total population of Bangladesh is more than 166 million, which is growing at an average rate of 1.1 percent per year. In addition, according to a report by The Business Standard, there are currently more than 37 million middle-class families in Bangladesh. Which is about 22 percent of the total population of the country and it is constantly growing. In addition, in the fiscal year 2020-21, Bangladesh’s per capita income increased by 8% over the previous year to 2,227 dollars. Apart from the rise in the number of middle and upper-class Bangladeshis, the country’s total consumption is also rising. As a result, the cost of medical care for the country’s citizens has soared.

Health Awareness

With the increase in income level, people in urban as well as rural areas have become more conscious about their health. Meanwhile, as the country’s medical and pharmaceutical companies adopt modern technology, the people of the country are paying close attention to proper nutrition, protein intake, healthy eating habits and avoiding other pollutants. Besides, the average life expectancy of the people of Bangladesh has also increased. According to the Bangladesh Bureau of Statistics, the average life expectancy of the people of Bangladesh was 66.4 years in 2002, which increased to 72.6 years by 2020. Awareness of the people of Bangladesh and growth of the pharmaceutical sector have played the biggest role behind such an increase in life expectancy.


According to the Bangladesh Association of Pharmaceutical Industries (BAPI), more than 1,200 pharmaceutical products have been registered for export in Bangladesh in the last two years. According to the Bangladesh Export Promotion Bureau, in the 2018-19 fiscal year, Bangladesh have exported medicines to a total of 147 countries, including Myanmar, Sri Lanka, Philippines, Vietnam, Afghanistan, Kenya and Slovenia where 60.32% of the exports went.

The remaining 39.6 percent to developed countries such as the US, Canada, Germany, and Australia. In FY 2018-19, Bangladesh exported a total of 130 million worth of medicines, which increased to 136 million in FY 2019-20. From 2014-15 to 2019-20, Bangladesh’s pharmaceutical exports have doubled at an average rate of about 12 percent per year. According to ResearchAndMarkets’, Bangladesh’s exports will increase to 450 million dollars by 2025.

Challenges in Near Future

As a least developed country, Bangladesh would get patent exemption on pharmaceutical products till 2033 as per the TRIPS agreement with the World Trade Organization. However, since Bangladesh is looking forward to graduating from LDC by 2026, Bangladesh is likely to lose the patent exemption facility 7 years before the expiration date. Which may stop the development of the pharmaceutical industry in Bangladesh because if Bangladesh loses the benefits of the TRIPS agreement, pharmaceutical companies will have to enact new patent laws. As a result, manufacturing of many types of generic medicine is likely to cease. If domestic manufacturers want to maintain production of these medicines, they may have to pay royalties on patents. As a result, the overall price of medicine in Bangladesh may increase. Otherwise companies will face patent violations and exports will be severely hampered. One of the biggest issues in Bangladesh’s pharmaceutical industry is that the country’s pharmaceutical companies are not paying much attention to research. As a result, there is a lack of innovation in the domestic pharmaceutical sector. Apart from this, one of the major threats in the pharmaceutical industry of Bangladesh is counterfeit and substandard medicines. Although there are strict standards on the quality of medicines exported abroad, there is a large supply of counterfeit medicines in the domestic market. As a result, quality producers are losing huge dividends every year. In addition, most of the raw materials used in the manufacture of medicines have to be imported from outside the country which if produced in the country, the pharmaceutical industry will be able to be more self-sufficient, and manufacturing costs can be further reduced.


Among the industrial sectors of Bangladesh, the pharmaceutical sector is advancing with the times. Besides meeting the demand for medicines in the country, Bangladesh is also earning a lot of foreign exchange through exports. Although the pharmaceutical industry plays a small role in the country’s GDP, it is hoped that if Bangladesh can sustain this growth, the contribution from this sector to GDP will increase even further in the future. However, to maintain the growth of the country’s pharmaceutical industry, Bangladesh needs policy updates.

One response to “Pharmaceutical Industry of Bangladesh: Prospects and Future Challenges”

  1. industry market size Avatar
    industry market size

    Hello, I am an avid reader of your website! I can totally relate to your point as I am a medical assistant for a BPO provider.

Leave a Comment