pharma n citi na

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Chapter 1

PROJECT PROFILE

1.0 INTRODUCTIONPharmaceutical is the worlds largest industry with revenues of USD 518 billion and 9% of

global GDP (North America contributing USD 248 billion). The pharmaceuticals sector in

Bangladesh is recognized as one of the fastest growing industry with an annual average

growth rate of 16% p.a. and market size of around BDT 30 billion. This sector is the

second largest contributor to the Govt. exchequer, employing around 75,000 skilled &

unskilled employees. According to IMS the growth rate in 2004 stood at 16%. In the early

eighties, there were 166 pharmaceuticals manufacturers, and the foreign manufacturers

controlled 75% of the market, which has by now changed dramatically.

1.1 Origin of the Report

The report is prepared under the supervision of Mr. Mohiuddin Ahmed, Lecturer, Institute

of Business Administration, as a part of the internship requirement of BBA program of

IBA, University of Dhaka. The Citibank N. A. guide on the project is Mr. K. M. Adnan

Masud, Resident Vice President and Head of Top Tier Local Corporates (TTLC) Unit of

Corporate Banking (CBG) Division. This report involves the project work at the Citibank,

N. A. Dhaka for a 12 weeks period from February 19, 2005 to May 19, 2005.

1.2 Background of the Report

Pharmaceutical sector is the recent thrust sector for Bangladesh. Every great opportunity

goes together with enormous threats. Existing legal and administrative infrastructure can

hinder the boom, but the real threat is the overriding of TRIPS facility after 2016. This spanof a decade is really crucial for not only expansion but also for building infrastructure

capable to fight the later rainy days. The smaller firms will most likely be unable to

compete against large local corporate and foreign competitors. The amalgamation, joint

venture and strategic alliance in various forms are likely to be taken place among the

industry players. With this regard, an effort has been made in the report to analyze the

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current scenario of the pharmaceutical industry from a strategic perspective and identify

opportunities for Citibank in expanding its business in this sector.

1.3 Objectives of the Report

Theprimary objective of this report is the partial fulfillment of the BBA program

requirement. Other objectives are --

To give an overview of the pharmaceutical industry of Bangladesh with respect to

structure, marketing mix, key industry players, export import scenario, industry

growth etc.

To illustrate the major rules and regulations governing the industryimplications of TRIPS- the major provision of GATT and the strategies to be

undertaken by Bangladesh.

To find out the major risks of the industry and their mitigants and the critical

success factors of the industry.

To analyze newer opportunities for Citibank, N. A. to expedite the business in

Pharmaceutical Industry down to the customer level of business sector.

1.4 Scope of the Report

The scope of the report is limited to Pharmaceutical industry of Bangladesh. More over the

information are limited to interaction with the respected Relationship Managers and their

industry contacts and the players are basically limited to Citibank clients or known

persons., All Citibank N.A. information are related to the Citibank N.A., Dhaka operations.

Moreover, Confidentiality of Citibanks information has been maintained. Hence exact

values which have been used in the report submitted to Citibank have been approximated in

this report. Moreover, the report is prepared according to the requirement and specification

of Citibank which kept the area of exploration limited.

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1.5 Methodology & Sources of Information

Both primary and secondary data has been used in this report.

The Primary Sourcesof Information were informal interviews with the bank officials.

Different Pharmaceuticals customers are interviewed in different occasions to know about

their responses regarding the opportunities. To get a comprehensive view of the industry

some major buyers and distributors have also been interviewed.

To have Secondary Information,data from International Market Survey (IMS) and related

publications, Annual report and web sites have been used.

1.6 Limitations

In preparing this report, different organizations were visited and informal interviews were

taken within a short period of time. Moreover, as information related to this sector was not

available in a structured form, the main constraint in writing the report is considered to be

the search of information.

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Chapter 2

PHARMACEUTICALS INDUSTRY

2.1 Healthcare and PharmaceuticalsPharmaceutical companies are establishments primarily engaged in manufacturi

fabricating, or processing drugs in pharmaceutical preparations for human or veterinary

use. The greater part of the products of these establishments are finished in the form

intended for final consumption, such as ampoules, tablets, capsules, vials, ointments,

medicinal powders, solutions, and suspensions. Pharmaceuticals are effectively medicinal

chemicals. In its basic chemical form, allopathic pharmaceuticals are called bulk drugs that

are basically the raw materials and the final dosage forms are known as Formulations(Tablets, Syrups and all other medicines we use as consumers).

2.2 Bulk & Formulation Drugs

Bulk drugs are medicinally effective chemicals. These are derived from four types of drug

intermediates:

Plant derivatives (herbal products) Animal derivatives (e.g.) insulin extracted from bovine pancreas

Synthetic chemicals

Biogenetic (human) derivatives (e.g.) human insulin

Formulations can be categorized as per the route of administration to patients, viz.

Oral (i.e.) tablets, syrups, capsules, powders etc taken internally.

Topical (i.e.) ointments, creams, liquids, aerosols that are applied on the skin.

Parental (i.e.) sterile solutions injected in an intravenous or intramuscularly fashion.

Others such as eye-drops, peccaries, surgical dressings etc.

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2.3 Major Disease Classes

The worldwide pharmaceutical industry is complex to all the business participants as well

to the end patients. The driver for this global industry is the Disease classes prevalent

around the globe. The pharmaceutical companies address these diseases through theirproduct offerings. The Therapeutic classification of Pharmaceutical products is also done

according to the major disease categories. Hence a brief understanding of the major classes

of ailments afflicting the people of the world will facilitate the understanding of the

Pharmaceutical industry. Table 1 below provides a major classification of the disease

classes as identified by researchers worldwide.

Table 1: Major Disease Classes Worldwide

Major Disease Disease Breakdown

Cancer

Colorectal cancer, Breast cancer, Lung/airway cancers,Prostate cancer, Bladder cancer, Lymphomas, Multiplemyeloma, Stomach cancer, Melanoma and other skin cancers,Uterine Cervical cancer, Pancreas cancer, Leukemia, Livercancer, Ovarian cancer, Mouth and throat cancers,Esophagus cancer, Cervical cancer

Cardiovascular

Ischemic heart disease (angina heart attack), Cerebrovasculardisease (stroke), Other cardiovascular diseases, Hypertensiveheart disease (angina, CHD), Inflammatory heart disease(from Infection)

Central Nervous

System (CNS)

Migraine, Depressive disorders, Alcohol use disorders,Alzheimer and other dementias, Insomnia (primary), Drug usedisorders, Epilepsy, Bipolar disorder, Schizophrenia, Panicdisorder, Obsessive-compulsive disorder, Post-traumatic

stress disorder, Parkinson disease, Multiple sclerosis

Gastro-IntestinalMisc. digestive diseases, GERD, etc, Peptic ulcer disease,Cirrhosis of the liver, Appendicitis

Infections

Tuberculosis, STDs excluding HIV, Chlamydia, Gonorrhea,Syphilis, HIV/AIDS, Diarrhoeal diseases, Childhood diseases,Pertussis, Measles, Tetanus, Poliomyelitis, Diphtheria,Meningitis, Streptococcus pneumoniae, Meningococcemiawithout, Homophiles influenza, Hepatitis B, Hepatitis C,Malaria, Lower respiratory infections including Influenza,pneumonia, or others

Metabolic Diabetes

Muscular-skeletal Osteoarthritis, Rheumatoid arthritis

Respiratory Asthma, Chronic obstructive pulmonary disease

Skin Skin diseases

Urogenital Benign prostatic hypertrophy, Renal failureSource: www.fuji-keizai.com/e/report/ww_drug_e.html

The essential focus of this study is the Allopathic Pharmaceutical Manufacturers anddistributors operating within Bangladesh both Local & MNCs.

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Chapter 3

GLOBAL PHARMACEUTICALS

Global pharmaceutical sales grew by 5 percent in 2004

to USD 518 billion. For the first time, g

pharmaceutical sales surpassed the $ 500 billio

threshold; and continuing to show the growing trend.

The global growth rate moderated as the market is

increasingly influenced by pressures and uncertainties,

including pricing, safety and regulatory issues.

Nevertheless, market growth continues to reflect the

unmet need for medications, as well as ongo

demographic dynamics that are strengthening

underlying demand. New opportunities are emerging in

markets such as China, and from sources of innovation in biotechnology, which will

continue to fuel future growth.

Cost Control & Rise of Generics

Factors contributing to growth in 2004 included a focus on cost containment by players in

major markets and the rise in

the use of generics. In 2004,

generics accounted for more

than 30% of volume

consumption in the US,

Germany, Canada and the UK,

and 17% in the top 12

European markets.

Nevertheless, generics still only accounted for 8% of drug sales by value in North America

and Western Europe. IMS expects cost containment to increasingly impact the US market,

where volume increases will be the major driver of growth. The worldwide pharmaceutical

Table2: Global Pharmaceutical Sales,

1997 - 2004

YearGlobalSales

(US$B)

% Growthover Prev

Year(Constant $)

1997 289

1998 297 7

1999 332 11

2000 357 10

2001 387 12

2002 426 9

2003 493 10

2004 518 5

All Information current as of Feb 05Source: IMS Global

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Figure 1: Global Pharma Sales 1997-2004

0

100

200

300

400

500

600

1997 1998 1999 2000 2001 2002 2003 2004


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market is expected to grow by 6-9% between 2005 and 2009. China, ranked as the ninth

largest individual market in 2004, is predicted to be ranked eighth by 2008, and possibly

higher, with 13-16% compound annual growth expected through 2008 outstripping the

other major markets.

Blockbusters & Biotechnology

In 2004, 82 drugs qualified as blockbusters - defined as drugs with sales over $1 billion

annually -- 17 more than the previous year. Increasingly, blockbusters target specialist

markets such as Oncology, and are fueled by a surge in new products derived from

biotechnology. Last year, 11 blockbuster drugs originated from Biotech companies.

Biotech products accounted for 27 percent of the active research and development pipeline

and 10 percent of global sales in 2004. According to IMS, biotechnology drugs nowaccount for 27% of the active R&D pipeline and over the next five years, innovative

products derived from biotechnology will continue to grow in the double digits and

represent an increasing share of the overall market.

Nearly 48 percent, or $248 billion of all global pharmaceutical sales, were in North

America. Of the major pharmaceutical markets, China showed the strongest year-over-year

performance, growing 28 percent to $9.5 billion.

3.1 Regional Performance

North America, Europe and

Japan accounted for 88 percent

of audited worldwide

pharmaceutical sales in 2004, the

same level as in 2003. North

America sales grew 8 percent, to

$248 billion. Sales in the

European Union rose 6 percent,

to $144 billion, while the rest of Europe saw sales growth of 12 percent, to $9 billion.

Japan realized modest year-over-year growth of 2 percent, to $58 billion.

Table 3: Pharmaceutical Sales by Region, 2004 (in USD Billion)

World Audited Market2004 Sales

(US$B)% Global

Sales

% Growth Year-over-Year

(Constant $)

North America $248 47.8% 7.8%

Europe (EU) 144 27.8 5.7

Rest of Europe 9 1.8 12.4

Japan 58 11.1 1.5

Asia, Africa, Australia 40 7.7 13.0

Latin America 19 3.8 13.4

Total IMS Audited* $518 100% 7.1%

*Source: IMS Health Global

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The Chinese market continued to grow

at a strong pace in 2004, up 28 percent

to $9.5 billion. China, currently the

ninth-largest pharmaceutical market, is

expected to become the world's eighth

largest by 2008 (Source: IMS Health).

"At a time when pharmaceutical

growth is moderating in North America, Europe and Japan, China has emerged as a

significant growth market, which will support sustained global growth in the future," said

Graham Lewis, IMS vice president, Strategic Consulting.

3.2 Leading Therapy Classes

The ten largest therapy

classes accounted for 33

percent of the total audited

world market in 2004,

representing more than

$173 billion. Five of those

classes -- cholesterol and

triglyceride reducers, anti-

cancer agents,

antipsychotics,

angiotension-II inhibitors

and anti-epileptics -- grew

more than 10 percent year-over-year. Angiotension-II inhibitors grew at a 22 percent pace

and anti-epileptics sales were up 18 percent.

Cholesterol and Triglyceride Reducers continued to hold the number-one position in

therapeutic classes worldwide, with sales of $30 billion, up 12 percent. Antiulcerants

Table 4: Leading Therapy Classes by Global Pharmaceutical Sales,2004

Audited World TherapyClass

2004Sales

(US$B)

% GlobalSales(US$)

% GrowthYear-over-Year

(Constant $)

1. Cholesterol & TriglycerideReducers

$30.2 5.8% 11.7%

2. Antiulcerants 25.5 4.9 1.4

3. Cytostatics 23.8 4.6 16.94. Antidepressants 20.3 3.9 1.3

5. Antipsychotics 14.1 2.7 12.1

6. Antirheumatic Non-Steroidals

13.1 2.5 3.3

7. Angiotensin-II Inhibitors 12.0 2.3 22.1

8. Calcium Antagonists Plain 11.6 2.2 1.6

9. Erythropoietin Products 11.4 2.2 8.9

10. Anti-Epileptics 11.3 2.2 17.7

Total Leading therapy classes* $173.3 33.2% 8.9%

Source: IMS MIDAS, MAT Dec 2004

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Figure 2: Regional Sales Performance 2004

North

America

47%

Europe (EU)

28%

Japan

11%

Asia,

Africa,

Australia

8%

Latin

America

4%

Rest of

Europe

2%


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remained the second-largest therapy class, growing 1 percent to $25 billion, with growth

slowed by the transfer of Prilosec to over-the counter status in the United States.

Future prospect of Anti Cancer Drugs:

In 2004, the Anti-Cancer class grew dramatically, overtaking Antidepressants and Mood

Stabilizers as the third-ranked therapy class. Sales for Anti-Cancer products were up 17

percent from 2003, to $24 billion. The rising sales of anti-cancer agents are another

example of biotechnology's impact in the global marketplace. In 2004, seven anti-cancer

drugs -- MabThera, Glivec, Eloxatine, Gemzar, Casodex, Taxotere

Zometa -- have achieved blockbuster status. Looking to the future, however, IMS expects

cancer drugs to challenge the other long-standing leaders. Combined, th

(antineoplastics) and L2 (cytostatic hormone antagonists) groups registered 17% growth in

2004. An increasing number of newer, targeted cancer therapies are seeing impressive

sales, such as Eloxatin, Glivec, Rituxan, and now Avastin approved for colorectal cancer

but also reporting a survival benefit in non-small cell lung cancer in March 2005.

Oncology projects accounted for almost 30% of the total industry R&D pipeline as of

February 2005, and the cancer market is expected to be worth more than $40 billion by

2008, driven by an ageing population, better diagnostics, and the introduction of further

innovative products that have many years of patent protection ahead of them. Moreover,

cancer drugs cannot be impacted by over-the-counter switching, which has affected the

performance of classes such as non-sedating antihistamines and proton pump inhibitors,

and, following the first introduction of Zocor Heart Pro in the UK in July 2004, could catch

on for the statins.

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3.3 Leading Brands 2004Though the top 10 individual pharmaceutical products had mixed fortunes, and reported

lower growth combined over 2003, they increased their global market share slightly in

2004 and achieved $53.6

billion in sales. Pfizer's

Lipitor again sold twice

as much as its nearest

rival, continuing its solid

growth of 14% from

2003 to reach annual

revenues of $12 billion

in 2004. Given upcoming

patent expiries and safety

concerns for rival statins,

Lipitor's position appears

unassailable, at least in

the short term... although, the fastest growing product in 2004 was Zetia, the cholesterol

absorption inhibitor from Schering-Plough and Merck & Co.

The most impressive performance within the top 10 came from sanofi-aventis and Bristol-

Myers Squibb's Plavix: the platelet anti-aggregant rose from eighth to third position in

2004, driven by promising trial results. The only new entry was Wyet

antidepressant Effexor, which replaced rival Zoloft from Pfizer in tenth place.

Table 5: Leading Products by Global Pharmaceutical Sales, 2004

Sl Leading Brands2004 Sales

(US$B)% Global

Sales

% GrowthYear-over-Year

(Constant $)

1. Lipitor $12.0 2.3% 13.8%

2. Zocor 5.9 1.1 -6.4

3. Plavix 5.0 1.0 31.4

4. Nexium 4.8 0.9 25.3

5. Zyprexa 4.8 0.9 -3.5

6. Norvasc 4.8 0.9 1.2

7. Seretide/Advair 4.7 0.9 22.5

8. Erypo 4.0 0.8 -4.1

9. Ogastro 3.8 0.7 -3.5

10. Effexor 3.7 0.7 20.1

Total LeadingBrands*

$53.6 10.3% 8.6%


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3.4 Top 10 Companies by Sales: 2004

According to the IMS report 2004 the top 10 corporations accounted for sales of USD 289

Bllion in 2004. Which was around 56% of Global sales? Pfizer was the top with sales of $

52.52 Billion and a corresponding market share

of 10.14 %. As Pfizer and GlaxoSmithKline retained their first and second places, there

was a new arrival in the shape of Sanofi-Aventis, formed when Sanofi-Synthelabo

Source: IMS

(Ranked 14 in 2003) merged with Aventis (seventh). Both Sanofi-Aventis and Roche had

above average growth across all the major geographical markets during 2004.

3.5 Retail Drug sales in 13 key Pharma markets in 2004

IMS HEALTH reported a 6% growth in drug sales through retail pharmacies in 13 key

markets in the 12- month

period from January 2004

through to December

2004, closing at US$347

billion. IMS Retail Drug

Monitor covers direct and

indirect pharmacy channel

purchases from

wholesalers and

Table 6: Top 10 Companies By Sales (in $Billions)

Sl Company Name SalesMKt

Share

1 Pfizer Inc 52.52 10.14%

2 GlaxoSmithKline 39.22 9.14%

3 Sanofi-Aventis 35.42 7.57%

4 Novartis AG 28.25 5.45%

5 Roche Holdings Ltd 27.64 5.34%

6 Merck & Co Inc 22.94 4.43%

7 Johnson & Johnson 22.31 4.14%

8 AstraZeneca Plc 21.43 3.80%

9 Abbott Laboratories 19.68 3.74%

10 Bristol-Myers Squibb 19.38 3.35%

Total 288.78 55.75%


TABLE 7: KEY COUNTRY DRUG PURCHASES - RETAIL PHARMACIES

Retail 2004 in USDMM

2003 in USDMM

%Growth

SELECTED WORLD 347,497 315,888 10

NORTH AMERICA 184,573 170,878 8

U.S.A. 174,525 162,302 8CANADA 10,049 8,577 17

EUROPE (leading 5) 86,724 75,655 15

GERMANY 25,097 22,725 10

FRANCE 21,248 18,432 15

ITALY 14,468 12,756 13

UNITED KINGDOM 15,628 12,981 20

SPAIN 10,283 8,761 17

JAPAN (*including Hospital) 57,627 53,109 9

LATIN AMERICA (leading 3) 13,289 11,932 11

MEXICO 6,448 6,202 4

BRAZIL 5,035 4,173 21

ARGENTINA 1,806 1,557 16AUSTRALIA/NEW ZEALAND 5,284 4,314 22

Source: IMSHealth - Retail Drug Monitor: 12 Months To Dec 2004

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Figure 3: Market Share of top 10

Companies 2004

Others

44%

Pfizer Inc

10%

GlaxoSmithK

line

9% Sanofi-

Aventis

8%

Novartis

5%

Roche

5%

J ohnson &

J ohnson

4%

Merck & Co

Inc

4%

Bristol-

Myers

Squibb

3%Abbott

Laboratories

4%

AstraZeneca

4%


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manufacturers in 13 key countries. Sales figures are at ex-manufacturer prices and include

all prescription and certain over-the-counter data. Figures include sales from the hospital

sector in Japan and mail order in the USA.

Retail pharmacy sales for these key markets had a 6% growth at constant exchange to

December 2004.

Sales in the top five European markets showed a 4% constant exchange growth, a

slight decrease from the previous IMS survey.

North America posted an 8% sales growth at $184 billion in sales in the 12 months to

December. The Key therapy growth area for North America was the Central Nervous

System group with an 11% growth at constant exchange

Japans overall growth at constant exchange decreased slightly by 1%, with a market

worth $57.67 billion in the 12 months to December 2004.

US dollar Growth in the three Latin

American Markets decreased

slightly from the last IMS survey.

By therapeutic category the biggest

increases worldwide were the blood

agents and cytostatics categories,

with sales growth at constant

exchange of 12%.

The single largest therapeutic sub

category in dollar sales continues to

be the C10, hypolipidemia, class

selling $26.59 billion with a growth of 11.8% in the 12 months to December 2004, a

Table 8: Retail Sales By Therapeutic Category

Sales2004

(USDMM)

Sales2003

(USDMM)

%

Growth

CARDIOVASCULAR 68,560 61,307 12

CENTRAL NERVOUS SYSTEM 64,733 57,274 13

ALIMENTARY/METABOLISM 49,584 46,481 7

RESPIRATORY 30,013 28,001 7

ANTI-INFECTIVES 27,587 27,045 2

MUSCULO-SKELETAL 22,577 19,720 14

GENITO-URINARY 18,574 17,455 6

CYTOSTATICS 17,293 14,715 18

DERMATOLOGICALS 10,163 10,763 6

BLOOD AGENTS 12,710 10,480 18

SENSORY ORGANS 7,049 6,386 10

DIAGNOSTIC AGENTS 6,393 5,760 11

HORMONES 5,603 5,012 12

MISCELLANEOUS 4,127 4,029 2

HOSPITAL SOLUTIONS 2,022 1,933 5

PARASITOLOGY 507 442 15

Source: IMS Health - Retail Drug Monitor: 2004

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slight decrease from last IMS survey. The second biggest group is the A2, anti-

ulcerants, class at $21.99 billion and with a 0.5% growth.

The best selling drug for the 12 months ending December 2004 was still Lipitor, worth

over $10.60 billion, with growth at 13.6%. Plavix still has the largest growth at the top

with 31%, a slight decrease since last survey. The five top drugs are 1. Lipitor, 2.

Zocor, 3. Nexium, 4. Plavix, 5. Norvasc

The top 5 corporations in the year to December 2004 were in order: 1.Pfizer,

2.GlaxoSmithKline, 3.Merck, 4.Sanofi- Aventis, 5, AstraZeneca.

3.5.1 New Products 2004

According to IMS, last year's sales growth hinged on market traction from new products.

Among the notable new products introduced in 2004 were several potential blockbusters,

including Eli Lilly's Cymbalta(R) (for depression), Genentech's Avastin(TM)

colorectal cancer), Forest Laboratories' Namenda(R) (for Alzheimer's disease), Bristol-

Myers Squibb/Imclone's Erbitux(TM) (for colorectal cancer) and Merck/Schering-Plough's

Vytorin(TM) (for cholesterol reduction). The full impact of these launches, however, will

not be felt until later in 2005.

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Chapter 4

BANGLADESH PHARMACEUTICALS INDUSTRY

4.1 History of Pharmaceutical Industry in Bangladesh

There are various types of medicines that are used in Bangladesh depending on the medical

practice, such as: Allopathic, Homeopathic, Ayurvedics, Herbal, Unani and so on. This

study is focused on the Allopathic medical practice, the modern Pharmaceutical industry.

The Non-traditional Medicines or Homeopathics, Ayurvedic s etc. are prepared from

plants, herbs, fruits, and flowers. They are relatively free from side effects. In fact not only

in Bangladesh there are rich verities of Herbal medicines worldwide. According to WHO,

herbal medicines have developed from the ancient times and further developed through the

ages of trials and reforms. It has stood test and are practiced all over the world. Bangladesh

also has a rich heritage of these kinds of non-chemical based medicine, which dates back

centuries. The modern Pharmaceutical industry of Bangladesh at present is one of the most

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promising sectors of the economy that after meeting 95-97% local demand increasingly

going for export.

4.2 Brief of Bangladesh Health SectorHospitals: According to the last official statistics total number of hospital in Bangladesh

were 1,382 wherein 670 were govt. and 712 were non-govt. (Source: BBS)

Physicians & Nurses: Total no. of registered physicians was 32,498. Persons per physician

are 4,043. Registered nurses were 18,135. (Source: BBS)

Govt. Expenditure on Healthcare: Total government expenditure on health including

family planning was BDT 23,450 million in 2003-2004 and per capita government

expenditure on health and family planning was USD. 4 in 2003-04. (Source: BBS)

Drug Manufacturers: At present, there are 231 Allopathic, 204 Ayurvedic, 295 Unani and

77 Homeopathic drug manufacturing companies in the country. They manufacture about

10,900 brands of medicine in different dosage forms. There are 1,500 (approx.) wholesale

drug license holders and about 50,000 (approx.) retail drug license holders in Bangladesh.

A detailed list of the manufacturers is provided in the Annexure. (Source: Directorate of

Drug Administration)

Drugs: There are about 450 generics registered in the country. Out of these 450 generics,

117 are in the controlled category i.e. in the essential drug list. The remaining 333 generics

are in the decontrolled category. The total number of brands /items that are registered in

Bangladesh is currently estimated to be 10,900, while the total number of dosage forms and

strengths are 8,300. (Source: Director of Drug Administration)

4.3 Market structure

Bangladesh Pharmaceutical market can be divided in terms of Geography, Demography as

well Medical Practice.

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4.3.1 Geographic Concentration

Though the market for the modern pharmaceutical products is pervaded all over the

country, the urban areas accounts for around 85% of the market due to higher purchasing

power. Five major districts (Dhaka, Chittagong, Comilla, Sylhet and Khulna) account for

70% of the entire market. A vast majority of people in rural areas seek treatment from

unqualified Allopaths, un-trained Paramedics, untrained Midwives and Traditional Healers

where quality control is virtually non-existent. The market for non-traditional medicine like

Unani, Ayurvedic, and Homeopath is also higher in rural areas. However that scenario is

gradually changing due to initiatives taken by the Govt. as well as the various NGOs

promoting modern treatment in the rural areas. The establishments of Thana Health

Complexes have also contributed to the spread of modern Healthcare system in the ruralareas. As a consequence the market of modern pharmaceutical industry is also expanding.

4.3.2 Demographic Concentration

The pharmaceutical market can also be grouped on

the basis of demographic concentration. The main

consumer of pharmaceutical products is people aged

above 16 years. The population and concentration of

disease by age is shown in table 9.

4.3.3 Major Disease Classes

The major diseases that people suffer from in the country are very much related to the

climate and economic standard of the people. Being a tropical country people suffers

regularly from Gastro Intestinal ailments among which Diarrhoeal disease is the most

recurrent and disease related to infection which accounts for almost one-third of all

diseases in the country, followed by anemia. Two other major classes of Disease in the

country is Common Cold and Pleurae related ailments.

4.3.4 Modern & Traditional

Pharmaceutical Market

Table 9: Demographic Concentration ofPopulation & Disease

Age Group 0-4 5-15 16+

Population 14% 31% 55%

Disease 24% 31% 45%

Source: Bangladesh Bureau ofStatistics

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Figure 4: Bangladesh Non Traditional &

Traditional Pharma Market

Veterinary Non

Traditional

Generic


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Bangladesh Pharmaceutical market can be divided into two major categories with one sub

category depending on the kind of medicine or medical practice used.

Traditional: Bangladesh has a rich heritage for traditional medicine like Unani, Ayurvedic,

Herbal & Homeopathic. As mentioned previously in 2004, there were 204 Ayurvedic, 295

Unani and 77 Homeopathic and Biochemic licensed manufacturing units. They produced

medicines worth Tk. 700 million in the year 2004.

Generic Drug Manufacturers Modern Pharmaceuticals Industry:

Unlike most of the import-based countries of South Asia and Africa, 95 percent of the total

demand for modern Pharmaceutical

products of Bangladesh is being metby local manufacturing. The remaining

5 percent basically constitutes import

of very specialized products like

vaccines, anticancer products etc. The

Pharmaceutical Industry of

Bangladesh contributed almost 1.30%

of GDP roughly about BDT 30 billion

in 2004 (Source: Bangladesh Bank,

IMS), mostly around 85% contributed by the Local companies. At present there are 231

registered Drug manufacturers in the country, which are employing around 75,000 skilled

& unskilled employees.

Veterinary Pharmaceuticals:This industry is a sub category of the broad pharmaceutical

industry that we discussed earlier. This is a BDT 3 Billion industry. Being an agro based

country there is good growth potential for this sector in

Bangladesh. We can see a brief overview of this sector in

table 10.

4.4 Pharmaceutical Market Size

Bangladesh

Table 10: Veterinary Pharmaceutical Industry Overview

Market Size Tk.200-300 Crore

Market Growth Rate 10-15% stable

Key Factors that drivethe growth of thisindustry

Marketing policy for Dairy andpoultry

Available quality product supply,Govt. loan

Major TherapeuticClass:

Antibiotic Vaccine Sulphur Anthalmentics (anti warm) Coccidiostacs

Major players Renata- Everything but vaccine Novartis- Vaccine Rampart Power Bayer Crop Science

Raw Material30% import (China / Korea / India /

Japan). and 70% localSource: http://w3.whosea.org/cntryhealth/bangladesh

Table 11: Domestic

Pharmaceutical Market Size:1995-2004

YearMarket Size (BDT

MM)

1995 11,316

1996 12,819

1997 14,500

1998 16,000

1999 15,520

2000 17,922

2001 22,371

2002 24,734

2003 26,3852004 28,654

Source: IMS

-17-


18/96

The pharmaceuticals sector in Bangladesh is recognized as one of the fastest growing

industry with an annual average growth rate of 14-16% p.a. and market size of around BDT

30 billion including export proceeds. According to IMS the growth rate in 2004 stood at

16%.

4.4.1 Bulk & Formulation Market

The Pharmaceutical market of Bangladesh can be further divided in terms of Bulk and

Formulations sales. However Bangladesh Pharmaceutical market has developed mainly in

the formulations side rather than Bulk segment. Bulk drugs accounts for around 4-5% of

total Pharma production. There are now 13 drug manufacturing units, which

manufacture certain basic materials or Bulk Drugs. These include Paracetamol, Ampicillin

Trihydrate, Amoxycillin Trihydrate, Diclofenac Sodium, Aluminium Hydroxide Dried Gel,

Dextrose Monohydrate, Hard Gelatin capsule shell, Chloroquine Phosphate, Propranolol

Hydrochloride, Benzoyl Metronidazole, Sodium Stibogluconate (Stibatin) Pyrante

Pamoate etc. However, most of these are confined to the last stage of synthesis.

Source: BAPI

-18-

Figure 5: Bulk & Formulation Market Bangladesh 1989-2004 (BDT MM)

0

5000

10000

15000

20000

25000

30000

35000

1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004

Form ulations BULK


19/96

4.5 Fragmentation

Presently, local & MNC manufacturers together

meet 95% of countrys drug demand. The market is

Oligopolistic in nature despite the presence of 231

government approved/licensed firms, of which 30

are large-scale units meeting 95-97% of the total

local demand. Bangladesh pharmaceutical industry is mainly dominated by domestic

manufacturers. Of the total pharmaceutical market of Bangladesh, local companies are

enjoying a market share of around 85 percent, while the multinationals are having a market

share of 15 percent. Another notable feature of Bangladesh Pharmaceutical industry is the

concentration of sales among a few numbers of Top firms. Here the top 15 players or 7% of

the manufacturers control around 71% of the market. The rest 93% of the market players

control the rest 29% of the market.

4.5.1 Top Pharmaceutical Companies by Sales Value 2004

According to IMS report 2004 out of the top 10 pharmaceutical companies in Bangladesh,

eight are local pharmaceutical companies; while two are MNCs namely Glaxo & Sanofi-

Aventis. The top 15 companies accounted for more than 71% of market share making a

sale of more than BDT 20 Billion in 2004.

Table12: Ranking of the top Pharmaceutical players 2004 (Sales Value).

Rankings Manufacturer Quarter (4Q, 2004) 12 Months, 2004

12 M QTR Values+ 000 Share % Growth% Values+ 000 Share % Growth%

Market Size 7,169,566 100.0 0.3 28,654,395 100 8.6

1 1 Square 1,120,748 15.63% 0.9 4,361,210

2 2 Beximco 593,356 8.28% 0.3 2,539,963

3 3 Acme 381,007 5.31% 5.3 1,500,327

4 5 Sanofi Aventis 350,436 4.89% -15.4 1,497,521

5 4 Incepta 368,499 5.14% 27 1,406,481

6 6 Eskayef 319,244 4.45% 14.7 1,252,339

7 7 Opsonin 319,022 4.45% -4.3 1,241,388

8 8 GSK 300,233 4.19% -8.4 1,147,717

9 9 Renata 271,821 3.79% 20.2 1,065,318

10 10 Drug Inter. 254,456 3.55% 5.9 1,016,808

11 11 ACI 243,897 3.40% 0.5 961,68

12 13 Aristopharma 177,242 2.47% -1 715

13 12 Orion 184,286 2.57% 21.1 697,5

14 14 Sandoz 144,373 2.01% 25 544,2

15 15 General Pharma 130,926 1.83% 13 478,5

Source: IMS-19-

Figure 6: Market Share of 231

Pharma Companies 2004

Mkt.

Share of

Rest 216

(93%)

Firms

29%

Mkt.Share of

Top 15

(7%)

Firms

71%


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The top two domestic manufacturers, namely Square and Beximco Pharma are having a

market share of about 25 percent (combined sale of BDT 7 Billion) of the total

pharmaceutical market of the country.

The finished formulation manufacturing base of Bangladesh is very strong as most of the

pharmaceutical

companies have their

own manufacturing

facilities. As we can see

in table 12 above though

according to cumulative

result Incepta was in the

5th position, in the last

quarter of 2004 Incepta

came up as the 4th

position pulling Aventis

in the 5th position. The growth rate of Incepta is quite high, in fact among the top 15 Incepta

recorded the highest growth rate in 2004 around 40%.

The top 2 MNCs namely Aventis & GSK both experienced negative growth. Aventis

experienced a negative growth 13% whereas GSK experienced a negative growth of

3.4%.

-20-

Figure 7: Market Share of top Manufactureres by Sales

Value 2004

GSK

4%

Renata

4%

Drug Inter.

4%AC I

3%

Orion

2%

Aristopharma

2%

General

2%

Sandoz

2%

Others

30%Square

15%Beximco

9%

Acme

5%

Sanofi Aventis

5%

Incepta

5%

Opsonin

4%Eskayef

4%


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4.5.2 Top Pharmaceutical Companies by Unit Sales 2004

In terms of Unit sales the similar concentration has been observed. According to IMS in

2004 the Pharmaceutical manufacturers made a total sale of 377-million u

pharmaceutical products in the

domestic market, which is a 4%

growth over the previous year.

Among the top 10 we see from

table 13 two are MNCs and the rest

are local companies.

As we had seen earlier the

concentration ratio of sales to No.

of players is quite similar in this

case too. The top 15 players control almost 72% of the market and the rest control the

Table 13: Ranking of the top Pharmaceutical players as per IMS 4TH Quarter Report. In termsof Unit Sales

Rankings Manufacturer Quarter (4Q, 2004) 12 Months, 2004

4Q 12M Units+ 00 Share % Growth% Units+ 00 Share % Growth%

Market Size 92,207.90 100 -3.1 376,631.60 100 3.6

1 1 SQUARE 14,297.40 15.51% 1.2 55,735.00 14.80% 6.7

2 2 BEXIMCO 7,707.80 8.36% -14.1 34,875.50 9.26% 8.7

3 3 ACME 6,661.70 7.22% -1.8 26,936.50 7.15% 4.5

4 4 OPSONIN CHEM 5,964.00 6.47% -12.4 22,936.80 6.09% -8.26 5 SANOFI AVENTIS 4,450.00 4.83% -21 19,118.40 5.08% -16.1

5 6 GLAXOSMITHKLINE 4,634.10 5.03% -12.1 19,033.60 5.05% -4

8 7 RENATA 3,636.70 3.94% -1.6 15,679.70 4.16% 3.8

7 8 A.C.I 3,844.50 4.17% 4.4 15,212.80 4.04% -3.6

9 9 ESKAYEEF 3,045.10 3.30% 5 12,254.40 3.25% 5.3

10 10 INCEPTA PHARMA 2,861.90 3.10% 26.5 10,787.80 2.86% 44.6

11 11 GACO 2,359.80 2.56% 19.9 8,720.30 2.32% 9.2

12 12 JAYSON 2,184.40 2.37% -4.7 8,515.80 2.26% -4.1

13 13 OPSO SALINE 2,106.00 2.28% 5.9 8,132.50 2.16% 9.8

14 14 IBN SINA 2,105.20 2.28% 9.6 8,023.60 2.13% 13

16 15 ARISTOPHARMA 1,732.60 1.88% -13.5 7,220.20 1.92% 5

Source: IMS

-21-

Figure 8: Market Share of Top 15 in terms of Unit

Sales (2004)

GACO

2.32%INCEPTA

2.86%

A.C.I

4.04%

ESKAYEEF

3.25%

J AYSON

2.26%

OPSO SALINE

2.16% IBN SINA

2.13%ARISTOPHARM

A

1.92%

Others

27.47

SQUARE

14.80%

BEXIMCO

9.26%ACME

7.15%OPSONIN

6.09%

SANOFI

AVENTIS

5.08%

GSK

5.05%

RENATA

4.16%


22/96

remaining 28% of the market. Similarly Beximco & Square the top 2 players of the market

control around 25% of the market. Again Square is top manufacturer in terms of unit sales

with a total sale of 56 million units followed by Beximco with a unit sales figure of around

35 million (Source: IMS).

However the ranking in terms of unit sale shows some differences from that of sales value.

We see Incepta and Eskayef has a different ranking when comes to sales by unit.

Previously Incepta & Eskayef was holding the position of 4 th & 5th respectively in terms of

sales revenue. But in terms of unit sale Incepta & Eskayef is ranked as 10th & 9th

respectively in 2004. This is mainly because they operate in relatively higher margin

products. Again we see Incepta showing the highest growth rate. In 2004 unit sale of

Incepta recorded a 45% growth over 2003. Whereas the leading MNC Aventis again

recorded a negative growth of 16.1 % and the other MNC GSK also recorded a negative

growth of - 4% in 2004.

4.5.3 Top Pharmaceutical Companies by Number of Products

Bangladesh Pharmaceutical industry is still at its

growth stage. The market has experienced

tremendous rate of new products introduction

enjoying the patent free market Environment. As of

2004 Square held the top position in the market with

their 204 brands of generic formulations. Opsonin

& Beximco held 2nd & 3rd position respectively with

173 & 170 no. of brands respectively. Incepta, the

youngest player among the top 10 market leaders, is ranked 8 th with a total brand of 127

generic formulations.

Table 14: Top 10 Manufacturers by Totalno. of Products 2004

Rank Manufacturer No. of Brands

1 Square 204

2 Opsonin 1733 Beximco 170

4 GACO 154

5 Aristopharma 139

6 ACME 129

7 Incepta 127

8 Drug Inter. 127

9 ACI 127

10 Sanofi Aventis 113

Source: IMS

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4.6 Therapeutic Segments

Formulations are end products of the pharmaceutical manufacturing process. There are

different therapeutic usage segments, each segment characterized by different market size,

growth rates, and competitive scenario. The domestic pharmaceutical market is mainly a

formulation market catering to the different therapeutic demands of the industry. Anti-

Ulcerants remains

the largest sector in

the Bangladesh

market, contributing

as much as 13% of

the total market size

in 2004. Growth in

this segment has

been consistent with

increasing

urbanization. The

Bangladeshi marketis mirroring the developed markets with the lifestyle-disease segment registering the

highest growth. The high rate of new product introduction as well as continuing

urbanization and lifestyle changes are likely to drive volumes in the Anti-Asthmatic,

Cardiovascular, Central Nervous System, Anti-Diabetic and Anti-Ulcerant segments. These

segments are also expected to become increasingly competitive as the number of players

rises.

The top 10 therapeutic classes accounted for around 52% of total market size in 2004. The

largest growth occurred in the area of Multi Vitamin & Minerals class (83%). This

indicates a growing trend in life style drugs category.

Table 15: Top 10 Therapeutic Class (TC) 2004

RANK TC NAMEVALUE IN

USDVALUE IN

BDTSHARE

%GROWTH

%1 ANTIULCERANTS 61,544,860 3,631,397,381 12.78% 14.12%

2CEPHALOSPORINS &COMBS

49,259,058 2,905,590,592 10.23% 12.47%

3 FLUROQUINOLONES 26,791,716 1,581,244,549 5.56% 4.37%

4ANTIRHEUMATIC NON-STEROID 25,337,359 1,495,093,347 5.26% 1.93%

5BORAD SPECTRUMPENICILLIN

20,979,658 1,237,473,576 4.35% -1.39%

6NON-NARCOTICANALGESICS

15,310,646 903,635,272 3.18% 14.92%

7MED+NARROWSPECTRUM PENIC

12,940,168 763,349,402 2.69% -6.99%

8ANTIHISTAMINESSYSTEMIC

12,634,671 745,143,716 2.62% -1.28%

9 ORAL ANTIDIABETICS 10,710,109 632,074,086 2.22% 16.46%

10MULTIVITAMINS +MINERALS

10,219,416 604,283,780 2.13% 82.77%

Source: IMS

-23-


24/96

Source: IMS

4.6.1 Top 10 molecules

In the molecule segment Ranitidine ranked the top with 7.11% market share with a growth

of 7.15% over previous

year sales. The vitamin

molecule segment

experienced a huge 70%

growth, which indicates a

rising demand for lifestyle

drugs as discussed earlier.

As we see in table16 the

top 10 molecules

accounted for a total sale

of BDT 9.6 billion which is around 34% of the total domestic market.

4.6.2 Top 10 brands

2004

Table 16: Top 10 Molecules 2004

RANK MOLECULEVALUE IN

USDVALUE IN

BDTSHARE

%GROWTH

%

1 RANITIDINE 34,041,633 2,007,769,101 7.11 7.15

2 AMOXICILLIN 21,140,976 1,247,024,693 4.41 -1.163 CEFRADINE 18,936,793 1,117,237,577 3.95 5.22

4 OMEPRAZOLE 17,745,883 1,048,039,895 3.71 29.50

5 CIPROFLOXACIN 17,383,773 1,026,053,750 3.63 -1.46

6 ASCORBIC ACID 12,989,569 767,437,746 2.72 75.68

7 CEFTRIAXONE 11,484,120 677,020,019 2.40 12.95

8 PARACETAMOL 10,878,579 641,976,325 2.27 13.51

9 VITAMIN E 9,393,562 555,167,162 1.96 69.91

10 DICLOFENAC 9,181,068 541,830,758 1.92 -1.51

Source: IMS

Table 17: Top 10 Brands in terms of Sales Value 2004

Sl. Brand CompanySales Value (BDT

000)Mkt share

(%)% +/-

1 Neoceptin-R Beximco 473,275 1.65% 23.10%2 Neotack Square 314,038 1.10% 19.40%3 Napa Beximco 298,007 1.04% 22.70%4 Fimoxyl Snaofi Aventis 267,464 0.93% 10.80%5 Losectil Eskayef 248,146 0.87% 11.50%6 Seclo Square 223,991 0.78% 55.40%7 Lebac Square 207,156 0.72% 24.80%8 Ciprocin Square 204,052 0.71% 6.00%

9 Sefrad Sanofi Aventis 195,143 0.68% -13.40%10 Ranitid Opsonin 194,969 0.68% -0.60%

Source: IMS

-24-

Figure 9: Top 10 Therapeutic Class Market Share 2004

0.00%

4.00%

8.00%

12.00%

16.00%


25/96

Dugs manufactured by the top players of the industry dominated the leading brands market

in 2004

4.6.2.1 By Value

Of the 10 top selling brands 8 belong to the top 4 manufacturers of the industry. As can be

seen in table 17 the top 10 brands accounted for a total sale of around BDT 2.6 Billion,

which is around 9% of total market size. Neoceptin-R of Beximco topped the list with a

sale of BDT 473 Million, closely followed by Neotack of Square with sales of BDT 314

Million. The top brands are very consistent with the disease associated with tropical

ailments e.g. seasonal cold, gastric problems etc.

4.6.2.2 By Unit Sales

Sales volume showed a different

composition than that of sales

value for the Pharmaceutical

products. The top 10 products

accounted for a total of 37 million

unit sale in 2004, commanding a

market share of around 10%.

However, even in term of volume

sale Beximco is ranked No. 1 with

their product Napa. In 2004 Napa of Beximco recorded the highest volume of sales with

sales of 7.7 million units as we see in table 18. Betnovate of GSk & Fimoxyl of Aventis

ranked 2nd & 3rd respectively. As we had seen earlier again the top selling brands are in the

category of diseases like Diarrhoea, Cold, fever, Ulcer, Anemia etc.

4.7 New Product

Table 18: Top 10 Brands by Sales volume 2004

Sl. Brand Company Sales Unit (+00) Mkt share % +/-

1 Napa Beximco 7,731.3 2.05% 7.20%

2 Betnovate GSK 4,450.3 1.18% 1.80%

3 Fimoxyl Sanofi Aventis 3,778.7 1.00% 10.80%

4 ACE Square 3,759.6 0.86% 21.40%

5 Orsaline SMC 3,234.2 0.86% 20.10%

6 Aristovit Beximco 3,082.4 0.82% 10.40%

7 Nebanol Square 2,871.1 0.76% -8.80%

8 Beonvex Renata 2,869.1 0.76% -6.70%9 Dextrose Opso Saline 2,620.0 0.70% -3.60%

10Brodil ACI 2,535.0 0.67% 11.30%

Source: IMS

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26/96

Bangladesh Pharmaceutical market is increasingly moving towards the practice of R&D

investments and introduction of new products in

the market. In 2004 alone a total of 1,052 new

brands of formulations were launched in

Bangladesh pharmaceutical market. In 2004 the

new products generated a sale of total BDT 1.41

Billion in the domestic market, which

is around 5% of the total domestic

market size. (Source: IMS). Among

the New Products (


27/96

Out of the BDT 1.41billion new product

market the top 10 manufacturers earned

revenue of BDT 1.06 Billion from their new

products in 2004. Incepta ranked no. 1 in

terms of revenue from new products with

sales of BDT 208 Million. Square generated

second highest revenue with sales of BDT 205

Million. The top 10 firms accounted for 75%

of the total new product sales revenue in

2004. BDT 168 Million worth of sales was

generated from the 5 leading new products of Incepta.

One notable feature of the new product market is that the top manufacturers are all

domestic manufacturers; the MNCs are not showing the sagacity in terms of introducing

new brands as the local manufacturers.

4.7.3 Top new Products 2004 by sales value

In 2004 among the

1,052 new products

the top 15

generated revenue

of BDT 487

Million, which is

around 35% of the

total new product

market size. As

shown in table 21

among the top 15

new products of

2004 Proviten A-Z

of Incepta recorded the highest amount of sales of BDT 93 Million. Flinel-Gold of Square

Table 20: Top 10 Manufacturers by SalesRevenue from New Product: 2004

Rank Manufacturer Sales (BDT 000)

Market 1,407,341

1 Incepta 207,934

2 Square 205,375

3 ACME 122,471

4 Aristopharma 114,263

5 Orion 86,492

6 Beximco 85,569

7 Renata 68,075

8 Opsonin 64,979

9 Eskayef 62,598

10 IBN Sina 37,611

Source: IMS

Table 21: Top 15 New Products 2004 by Sales Value

Rank Product Manufacturer Sales (+000) Mkt Share

Market 1,407,341 100.00%1 PROVITEN A-Z Incepta 93,143 6.62%

2 FILNEL-GOLD Square 69,822 4.96%

3 VERTEX Orion 46,777 3.32%

4 NUTRUM-PN ACME 40,764 2.90%

5 OVEL Aristopharma 35,213 2.50%

6 TIXI Square 32,704 2.32%

7 PROVITEN SILVER Incepta 20,839 1.48%

8 VALCOX Opsonin 20,247 1.44%

9 NUTRUM-SUPER ACME 20,168 1.43%

10 PPI ACME 19,660 1.40%

11 FIXOCARD Incepta 19,341 1.37%

12 GATLIN Renata 17,356 1.23%

13 OSARTIL-50 PLUS Incepta 17,339 1.23%

14 GATIFLOX Incepta 17,314 1.23%

15 CLOGNIL PLUS Orion 16,653 1.18%

Source: IMS

-27-


28/96

was ranked 2nd with sales revenue of BDT 70 Million. This was followed by Vertex of

Orion with a sale of BDT 47 Million.

4.8 Consolidation

Though Bangladesh Pharmaceutical Market is yet to see any large scale mergers or

acquisitions among the top players, increased buy-outs of brand and manufacturing

facilities may be witnessed as 2016 approaches; however, it is unlikely that any large

value-comprehensive mergers among the top tier-Bangladeshi companies since most of

them are trying to be increasingly vertically integrated and taking initiatives for setting up

of raw material plants. MNCs are unlikely to acquire domestic firms owing to patent

infringement. Furthermore, the MNCs have increasingly begun to outsource manufacturing

hence unlikely to acquire further manufacturing capacity.

4.8.1 Toll Manufacturing

Nowadays, most of the companies are not interested to invest in manufacturing facilities.

Rather companies prefer to outsource their manufacturing to any low cost manufacturing

unit, which is called toll manufacturing. Considering the cost-benefit of

investments, most of the companies use all of their resources and expertise in marketing.

With regards to manufacturing, most of the companies in developed markets are now going

for toll manufacturing. As Bangladesh has a very strong manufacturing base in

pharmaceuticals, other countries could get their products manufactured in Bangladesh

through toll manufacturing. Needless to mention that huge investment has taken place in

this sector during the last few years and a number of companies have already constructed

facilities as per USFDA and UKMHRA standard and are going for certification in the

regulated markets. It is probable that Global Pharmaceutical giants may

Bangladesh Pharmaceutical companies to be their outsourced manufacturing base.

4.8.2 Joint-Venture Opportunities

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Since India and China have very good expertise in API and formulation R&D, they may

like to manufacture the APIs outside their countries as they cannot manufacture these

patented APIs in their countries after 2004. Because of cost advantage

pharmaceutical companies of highly regulated markets are now going for joint venture

projects. They have already signed several contracts with companies of India and China.

Bangladesh also has enormous opportunities to go for joint ventures with these large global

companies for manufacturing pharmaceutical finished products.

4.9 Marketing & Distribution

The Bangladeshi market is heavily focused on marketing due to a lack of differentiation in

product offerings. Most importantly, promotion of pharmaceutical products is

restricted by the rules and regulations of Drug Administration Authority,

Directorate of Drug Administration (DDA). DDA has a detailed Code of Pharmaceutical

Marketing Practices (CRMP) to control the promotion of Pharmaceutical products in

Bangladesh. The code can be read in detail in www.ddabd.org. No media promotion is

allowed. TV, Radio and Newspapers or any other printed media cannot be used and no

direct advertising to the public can be done.

4.9.1 Promotional tools

The key to a pharmaceutical product success remains marketing and being among the first

three companies to launch the product. Largely doctor prescriptions in the case of ethical

drugs and retailers in the case of OTC products drive the end consumer demand. The main

promotion is done through gift items and Physicians sample. Some companies are taking

innovative steps to attract chemists through gift items. Promotional discount is also a very

common tool to attract chemists in case of bulk purchase.

4.9.1.1 Medical Promotion Officers

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http://www.ddabd.org/


30/96

Suppliers

MPOS

Factory Depots

Distributors

Doctors/Chemists

Retailers

Clinics/Institutions

Figure 11: DistributionDynamics

Source: BAPI

By nature pharmaceuticals industry is quite aggressive in marketing their products and

personnel selling is the main marketing technique used. This personnel selling is done by

sales representatives/ Medical Promotion Officers (MPO) of the pharmaceu

companies. These people are basically their sales persons and the sales department controls

them.

Doctors are provided with a lot of literature about all the products and samples are also

provided. In fact the company designs special packs for sample medicines. Apart from this,

the sales representatives develop a personal relationship with the doctors and giving small

gifts, wishing the doctor on his/her birthday etc. is very common.

4.9.2 DistributionThe Medical Promotion Officers (MPO) plays the key role in distribution channels of the

pharmaceutical industry.

MPOs procure orders from

the four broad categories of

customers as seen in figure

11 and places the same to

sales depots. Sales depots

accordingly advise the

factory through the

centralized sales

department. Commercial

department procures the raw material from the supplier and feed the factory that produces

the formulations for supply to the Depots. MPOs use the delivery fleet to distribute to

different client segments. In addition to that the marketing and sales department procures

bulk orders from Govt. and institutional sales.

The overall pharmaceutical market consists of around 70,000 pharmacies/chem

including unlisted ones, who mainly constitute the retail market for pharmaceutical

products. There are about 25,000 graduate doctors and Rural Medical Practitioners (RMPs)

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who play a major role in sale of pharmaceutical products. To note, the Doctors and RMPs

generate 45% of total pharmaceuticals sales of the country. The institutional buyer segment

is represented by NGOs, hospitals that include Govt., private, specialized, Thana Health

complexes and clinics as well as other organizations, which procure medicines for their

own consumption.

4.10 New Investments in the last 5 years

The country's pharmaceuticals sector witnessed an investment boom in the last couple of

years as around BDT 25 billion have been ploughed into it alone. Investment worth BDT

20 billion is on way as the government has decided to set up an API Park in Chittagong

with the facility to house 20 plants. In the last few years as many 10 companies eachinvesting BDT 400 million or more have emerged. Some are already marketing their

products while others are in the process. The leading companies are also taking innovative,

forward-looking steps. They have set their eyes firmly on the WTO's TRIPS and Public

Health agreement, which promises Bangladeshi companies the opportunities to export

billions between 2005 and 2016.

Both Square and Beximco have gone in for additional new modern manufacturing

plants in line with international guidelines for CGMP. (Current good Manufacturing

Practice)

Square invested BDT 240 Crore in a plant at Kaliakoir, Gazipur, near Dhaka recently.

Commissioned in June 2002, it is built as per requirements of the US FDA (Food &

Drug Administration) code of Federal Regulations to ensure CGMP compliance is

being readied for UK MCA and US FDA approvals.

In Beximcos case, its new plant, meeting requirement of US and European markets,

has completed installed advanced and sophisticated manufacturing equipment. Both

these companies have planned the finest facilities of global standards with the

objective of getting into contract manufacturing for overseas companies in the near

future.

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Other than Square and Beximco, other companies are also increasingly going for

international standard manufacturing facilities. Acme Laboratories ranking third has

one plant set up in 1983 and has spent BDT 70 Crore to refurbish its plant and has

invested another BDT 20 Crore for a separate plant. Opsonin will invest more than Tk

100 Crore to build up a new plant in Barisal. Orion also has a plan to set up a Tk 100

crore plant at Bhaluka, Mymensingh.

Not only the big shots but also mid-ranking and new houses have also come up with

big investments. Renata bought 55 acres of land in Gazipur to set up a new plant at a

cost of Tk 70 crore.

Incepta has built up a new plant at Ashulia, Dhaka with an investment of around Tk 70

crore. Aristopharma has bought several plots in Narayanganj BSCIC estate to set up its

new plant. At present, over 300 companies have licenses for producing drugs in the

country but only about 100 are in operation and 30-40 is active, industry sources said.

New and old pharmaceutical companies are making investments in a big way in the sector,

seeing immense export prospects of their products. Newcomers -- Silva, Mystic, Apex,

Rangs, Popular, Marksman and Healthcare pharmaceuticals -- have already invested

around Tk 40-Tk 50 crore each. An Indian company -- Sun Pharmaceuticals -- also made

its debut in Bangladesh early last year. It has become evident that to satisfy the market in

Europe there is no alternative to set up highly equipped plants, which are, environment

friendly, FDA and ISO certified. They should also have machineries imported from

European countries and use raw materials from the same source.

4.11 Cost Analysis

The three major cost heads for the Bangladeshi pharmaceutical industry are

Material costs

Marketing and selling expenses

Employee costs

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4.11.1 Material Costs

Material costs account for over 38% of the total cost of goods sold of the top 15

pharmaceutical firms. The share of material costs, however, increased between FY 2002-

03 and FY 2003-04 from 31.5% to 38.5%. The primary reasons for this reduction were Increase of Raw materials price in international market

Devaluation of Local currency against foreign currency during import of Raw

Materials.

4.11.2 Marketing and Selling Expenses

Selling, Marketing and Administrative expenses take away 65.2% of the gross margin

(GM). Because this industry is heavily dependent on sales persons and personal promotionthis cost is quite logical. The share of these costs decreased in the last two years from

67.4% to 65.2% of the GM. Domestic firms averaged at 62.3% of their Gross Margin in

2003, whereas MNCs averaged at 70% in 2003. Historically MNCs always averaged

higher than their domestic peers.

4.11.3 Employee Costs

The third highest heading for costs in the Bangladeshi

pharmaceutical industry saw an increase between FY

2002-03 and FY 2003-04, from 30.4% to 37.8% of cost

of goods sold. The employee costs for MNCs were

significantly higher than those of domestic firms at

37% of COGS versus 24% for domestic firms. Salary,

Wage and Allowance cost increased for both local and

multinational firms due to growth in the industry to

avail TRIPS benefit, which created higher demand forskilled manpower.

There exists a high turnover rate in several segments of the pharmaceutical industry. The

entry of MNCs post-2005 is also likely to lead to a rise in the attrition rates in

Table 22: Typical Cost Structure of A

Pharma CompanySales 100.0%

Excise duty/VAT -14.0%

Net sales 86.0%

Cost of Goods Sold -60.5%

Gross Margin 35.5%

Operating Expense -20.0%

EBIT 15.5%

Other Income 4.0%

Tax -3.5%

Net Income 16.0%

Source: Primary

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administrative and R&D segments in the short term. Companies are beginning to consider

ESOPs and performance linked bonuses as means to retain talent.

4.12 Margins

The operating profit margins

(OPM) of the Bangladeshi

pharmaceutical industry have

shown a steady growth over the

past five years. Although there

were increases in material as well

as employee costs, decrease in

Selling, Marketing &

Administration cost as well as

efficiency in other production

factors e.g. overhead made this possible. Domestic pharmaceutical firms were able to

achieve better OPM s than their MNC peers on account of lower employee costs and lower

R&D cost.

The net profit margin has been showing a slow but steady improvement over the last five

years and remained over 13.5%. The attempt to lower the interest rate by Bangladesh bank

along with the promises in the industry helped lowering operating expenses. Although

consistent devaluation of BDT against Dollar increased the import cost which hampered

the profitability of the companies relaying heavily on import of basic materials.

The local firms are showing a better trend in profit margin as they are now focusing in to

export more than selling locally. This may significantly lower the marketing & selling costsand thus resulting in better margins.

Still the volatility in currency rate and other external environmental factors are playing

significant role for the relatively low NPM. As the companies will concentrate more on

producing basic chemicals locally rather than importing, the margin will be better.

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Figure 12: Trend in Profit Margin

0

5

10

15

20

25

FY 1999 FY 2000 FY 2001 FY 2002 FY 2003

Operating Income Net Profit


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4.13 Brief of Top Industry Players

4.13.1 SQUARE PHARMACEUTICALS LIMITED

Operation Started: 1985

Vision, Mission & Objective: The Vision statement of Square is We see business as a

means to the well-being of the investors, employees and the society at large, leading to

accretion of wealth through financial and moral gains as a part of the process of the human

civilization.

To achieve this vision their mission is described, as Our mission is to provide quality

& innovative healthcare relief for people, maintain stringently ethical standard in

business operation also ensuring benefit to the shareholders and other stakeholders.

Product Range: Tablets, Capsules, Suppositories, Injections, Liquids, Spray, Drops,

Ointment, Cream and Powder, Oral Dry Powders, Dry Powder Inhalers, Metered Dose

Inhalers

Exports: Square Pharmaceuticals Ltd. now Exports to 23 different countries.

Asia: Bhutan, Cambodia, Malaysia, Maldives, Myanmar, Pakistan, Papua New Guinea,

Philippines, Nepal, Sri Lanka, Vietnam, Yemen.

Africa: Ethiopia, Ghana, Kenya, Libya, Mauritius, Mozambique, Sierra Leone, Tanzania,

Europe: Kosovo, Russia, Ukraine

Human Resource: Square has a total Human Resource of 1,962 employees with 56

managers, 195 executives and rest

are either non-executives or field

workers.

Business Description: Square

Pharmaceuticals Limited, the

market leader, is the most

Table 23: Financial Snapshot: Square Pharmaceuticals ( BDT M)

2003-04 2002-03 2001-02 2000-01 1999-00

Turnover (Gross) 5,482,088 4,729,743 4,234,244 3,451,523 2,655,952

Value Added Tax 760,536 663,892 563,433 450,577 342,108

Turnover (Net) 4,721,552 4,065,851 3,670,811 3,000,946 2,313,844

Gross Profit 1,906,592 1,466,282 1,435,655 1,081,340 826,978

Net Profit before Tax 1,151,636 929,604 905,736 691,636 505,100

Net Profit after Tax 970,044 764,885 759,448 573,677 418,152

Shareholders Equity 4,590,142 3,851,098 3,273,714 2,751,766 2,178,089

Total Assets 5,870,261 5,164,320 4,526,115 3,810,860 3,233,586

Total BankBorrowings

981,510 1,070,163 1,098,874 938,371 792,505

Total Current Assets 2,008,956 1,441,552 1,452,494 1,017,574 947,055

Total Current

Liabilities1,243,575 1,247,967 1,181,473 708,993 568,432

Current Ratio 1.62 1.16 1.23 1.14 1.67

Source: Financial Statements

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respected name in the industry and it is quickly spreading its fame beyond the horizon. The

long journey since the inception in 1958 was not a smooth path. After building a strong

base of enormous effort it has today burgeoned into one of the top line conglomerates in

Bangladesh. Square Pharmaceuticals Ltd., the flagship company, is holding the strong

leadership position in the pharmaceutical industry of Bangladesh since 1985 and is now on

its way to becoming a high performance global player.

Square Pharmaceuticals Limited is the largest pharmaceutical company in Bangladesh and

it has been continuously in the 1st position among all national and multinational companies

since 1985. It was converted into a public limited company in 1991. The sales turnover of

SPL was more than BDT 5 Billion (US$ 90 million) with about 15% market share (April

2003 March 2004) having a growth rate of about 16%. Last Year Square declared Bonus

share in 5:1 Ratio and cash dividend per share was USD 1.19/ share.

4.13.2 RENATA LIMITED

Brief History: Founded in 1972 as a subsidiary of Pfizer Inc. Ownership transferred from

Pfizer Inc. to local institutions and the general public in 1993. Company name subsequently

changed from Pfizer Laboratories (Bangladesh) Limited to Renata Limited

Vision & Mission: The Vision of Renata is To Establish Renata Permanently among the

best of innovative branded generic Companies The Mission Statement of Renata Limited

is To Provide maximum value to our customers, shareholders, colleagues and the

communities where we work and live

Product Range: Antibiotic, Anti-hypertensive, Lipid lowering agent, Anti-parasitic &

anti-protozoal agents, Anti-fungal agent, Diabetic Care, Steroid, Cosmetic Health Care

Product (Anti-acne agent), Iron & Vitamins, Anti-allergic, Non Steroidal

inflammatory, Analgesic & Antipyretic, Expectorant & Anti-Asthma

Exports: Renata Exports Human Pharmaceutical Products to: Myanmar, Nepal and

Srilanka.

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Human Resource: Total Number of Employees is 1,177

Business Description: Renata,

an ISO9001 (DNV) qualified

company, is a Listed Public

Limited (Dhaka Stock

Exchange) company with an

annual turnover of US $18.5

Million, Retained Earnings:

US $4.7 Million and Net Asset Value: US $10.6 Million. Renata is en

Manufacture and Marketing of Human Pharmaceuticals and Animal Therapeutics of

Nutrition products (No. 1 in Market in terms of Sales.). The 120,000 Square Feet (11,150

m2) Plant is located in Dhaka on 12 Acres of Land. Last year the board of directors

recommends a cash dividend of Taka 50.00 per ordinary share of Tk.100 and they also

recommend for Stock Dividend (Bonus Shares) in the ratio of one Bonus Share for every

five shares held (1:5).

4.13.3 BEXIMCO PHARMACEUTICALS LIMITED

Brief History: Beximco Pharmaceuticals Limited (BPL) started its journey back in 1980

with manufacturing and marketing of licensee products of Bayer AG, Germany and Upjohn

Inc. of USA. After its initial years of struggle, it broke ground with the launching of its

own products in 1983.

Major Products: The Block Buster products of BPL include: Napa, Neoceptin R,

Neofloxin, Tycil, Aristovit M etc.

Exports: Presently BPL is exporting to: Myanmar, Kenya, Pakistan and Singapore. In the

near future they have planned to expand in Asian countries like: Philippines, Cambodia, Sri

Lanka and Nepal. In East: Africa Tanzania and Uganda.

Table 24: Financial Snapshot of Renata (In BDT)

2001 2002 2003

Turnover 822,795,535 911,593,846 1,110,041,348Cost of goods sold 482,924,357 531,953,504 591,142,479

Gross profit 339,871,178 379,640,342 518,898,869

Profit before taxation 105,844,217 94,594,207 150,434,885

Profit after taxation 69,344,893 72,564,245 105,561,208

Property, plant and equipments 449,901,262 471,378,477 520,473,441

Total current assets 379,814,152 399,329,580 455,136,227

Total assets 469,827,785 514,675,037 576,518,593

Share capital 46,488,700 46,488,700 46,488,700


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Human Resource: Total number of Employees of BPL is 1,328, which is consisted of 862

officer and 466 staff.

Business Description: Beximco Pharmaceuticals Ltd. is a member of the Beximco Group

- the largest private sector

business conglomerate of

Bangladesh. With a record of

the highest growth rate in the

history of Bangladesh

Pharmaceutical Industry, BPL

has maintained its leadership

position with consistent growth

over the years. BPL is the first pharmaceutical company in Bangladesh to receive such an

award. BPL was also awarded National Export Trophy Gold for two consecutive years

1998-1999 and 1999-2000. BPL has transformed its activities, culture, style and philosophy

to meet the demands of the new millennium. The Differential edges of BPL includes:

World class manufacturing facilities, Highest CGMP standards, Outstanding product

quality, Sophisticated formulation technology, Diversified dosage forms & products,

Significant investment in R&D, Excellent customer services, Responsible care for the

environment, Commitment to the people & the society. Last year BPL declared a 20%

dividend per share.

4.13.4 THE ACME LABORATORIES LTD.

Brief History:The history of The ACME Laboratories Ltd. dates back towhen a proprietorship firm was founded to manufacture ethical drugs. It started with the

modest introduction of a few oral liquid products. The firm was converted into a private

Limited company in the year 1976. Commercial operation at the modernized plant

equipped with sophisticated and advanced facilities began toward the end of 1983.

Table 25: Financial Snapshot of Beximco (In BDT M)

Particulars 2003 2002 2001 2000 1999

Authorized Capital 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000

Paid up Capital 508,875 442,500 442,500 442,500 442,500

Total Turnover 2,183,830 2,508,788 2,401,241 2,452,524 2,398,985

Export Turnover 59,594 50,284 47,325 44,268 35,846

Gross Margin 828,081 888,295 942,133 895,783 816,089

Profit Before Tax 263,619 362,232 430,420 422,644 413,312

Net Profit 224,643 341,680 401,780 398,295 386,576

Fixed Assets at cost 6,669,824 5,512,974 5,141,780 4,062,660 3,759,880

Shareholders'Equity

4,643,615 4,441,096 4,165,791 3,764,011 3,454,217


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Mission & Vision: The mission statement of Acme is Our holistic approach is to ensure

Health, Vigor and Happiness for all by manufacturing ethical drugs and medicines of the

highest quality at affordable prices and reaching out even to the remotest areas by

proper distribution network. We view ourselves as partners with doctors, our customers,

our employees and our environment. The vision statement includes Reaching out even

to the remotest areas of Bangladesh and improving lives with quality products at an

affordable price.

Product Range: Analgesic & Antipyretic, Antacid, Anthelmintic, Antiamebic,

Antianginal, Antiasthmatic & Bronchodilator, Antibiotic & Chemotherapeuti

Antidiabetic, Antidiarrhoeal, Antiemetic, Antifungal, Antihistaminic & Antiallergic

Antihypertensive & Cardioprotective, Antihyperlipidamic, Antimigraine, Antispasmodic,

Antituberculous, Antivertigo, Anxiolytic and Antidepressant, Diuretic, Electrolyti

Enzyme, Expectorant, Eye Product, H2 Receptor Antagonist, Hematin

Immunosuppressant, Laxative, Nasal Product, Nonsteroidal Anti-Inflammatory (NSAID),

Proton Pump Inhibitor Scabicidal, Steroid, Vitamin & Mineral.

Exports: At present, ACME is exporting medicines to several countries in neighbouring

South-East Asia, Africa, Middle East and the EU. The regular export market includes:

Myanmar, Nepal, Sri Lanka, Afghanistan, Hong Kong, Pakistan, Philippines & Vietnam.

Human Resource: Over 1,600

energetic and highly motivated

employees from diverse disciplines

are working untiringly with ACME in

Bangladesh and abroad.

Business Description:Acme is an

ISO 9001:2000 certified company

with a Wide range of dosage forms &

products. This Sophisticated

manufacturing facilities in a state-of-the-art factory is exporting successfully to 11

Table 26: Financial Snapshot Acme

(Figures in 000 BDT) 2000 2001 2002

NetSales 1,302,781 1,564,270 1,845,577

Gross Profit 559,073 686,407 803,618

Operating Profit 180,640 224,486 254,029

Net Profit 89,176 116,112 141,672

Sales Growth Rate (%) N/A 20.07 17.98

GP Margin (%) 42.91 43.88 43.54

NPAT Margin (%) 6.85 7.42 7.68Total Assets 978,842 1,192,979 1,440,826

Net Worth 470,804 581,915 708,588

Current Ratio (x) 1.74 1.76 1.71

Leverage (x) 1.08 1.05 1.03

Return to equity (%) 18.94 19.95 19.99

Source: Annual Reports

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countries Worldwide. ACME continuously seeks to expand its production facilities, add

employees and increase its sales and marketing efforts. According to the latest statistics,

out of about 300 pharmaceutical companies in the country, The ACME Labs is one of the

top four. ACME has also endeavored to strengthen its network in international marketing

operations to export its products abroad.

4.13.5 SANOFI-AVENTIS

Brief History: On December 16, 1999 Hoechst Marion Russel of Germany and RPR

merged globally to create Aventis. Presently, Aventis is the 3rd largest pharmaceutical

company in the world after the merger with Sanofi. Operational integration of RPR and

HMR in Bangladesh has been completed. Production facility of HMR has been sifted from

Chittagong to RPR plant at Tongi. With a superb belongingness and teamwork mentality,

combined sales force of RPR, HMR and Fisons is one of the biggest sales teams in the

country.

Mission & Vision: The Mission of Aventis Pharma states Our mission is to become the

best pharmaceutical company in the world by dedicating our resources, our talents and our

energies to help improve human health and the quality of life of people throughout the

world.

Strategic and Important Products: Actonel, Clexane, Tritace, Amaryl, Taxotere, campto,

Nasacorf, Azmacof, Enocef, Sefradm Fimoxyl, Asinar, Flagyl, Fiprox, Fluxon, Oracyn-K,

Rova Mycine, Ficlox, Fisat & Fisat-DS, Ficlon Suppository, Flagyl Suppository, Profenid

Suppository, Doliprane Suppository, Inflam, Ficlon, Folfecap-CR, Retina, Macrocin-T

Exports: One of the Major Players and 3rd largest globally has business almost all over the

globe.

Business Description: As a global industry leader Aventis seek to conquer and prevent

disease by bringing to market innovative pharmaceuticals, vaccines, therapeutic proteins

and diagnostics. Aventis Pharma was created as a part of the 1999 business combination of

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Hoechst and Rhone-Poulenc to form Aventis SA, one of the world's leading life sciences

companies. In 2004 Aventis merged with Sanofi and became Sanofi-Aven

concentrates its efforts on strategic brands that meet growing patient needs and contribute

to a long-term sales growth. With 2001 sales of 15.168 billion euro (excluding sales of

diagnostics), Aventis Pharma contributes three-quarters of the life sciences sales of Aventis

SA. The Aventis Pharma prescription drug business is investing about 2.98 billion euro a

year in Drug Innovation and Approval, one of the industry's largest R&D budgets. Sanofi-

Aventis Values for: Respect for people, Integrity, Sense of urgency, Netw

Creativity, Empowerment, and Courage. Therapeutic developments and clinical trials have

brought innovation and resulted in medicines that can benefit patients in many key

therapeutic areas. Through its investments Aventis Pharma is well positioned to meet the

growing needs of patients in Bangladesh. The group is poised to take quantum leap with

their current plans of investing more in promoting their products and other medico

marketing activities. Aventis also has an exciting range of products in pipeline at short and

medium term in the near future.

4.13.6 ADVANCED CHEMICAL INDUSTRIES

Brief History: In 1973, the UK based multinational pharmaceutical company, ICI plc,

established a subsidiary in Dhaka, known as ICI Bangladesh Manufacturers Limited. In

1992, ICI plc divested its share to local management, and the company was renamed

Advanced Chemical Industries (ACI) Limited.

Mission & Vision: ACI vision is to play a leading role in improving the quality of life and

well being of the people of Bangladesh through responsible application of knowledge and

skills.

To realize the Vision ACI has the following missions:

Endeavor to attain a position of leadership in each category of its business.

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Provide products and services of high and consistent quality ensuring value for

money to its customers.

Attain a high level of productivity in all its operations through effective utilization

of time and adoption of appropriate technology.

Contribute to the personal development, encourage empowerment and recognize

innovation of its employees.

Ensure superior return on investment through healthy and sustainable growth of the

company.

Encourage and support qualitative improvement of the services of its distributors

and suppliers.

Product Range: ACI produces a comprehensive range of about 120 formulations covering

all major therapeutic areas that comes in tablet, capsule, powder, liquid, cream, ointment,

gel and injection forms. ACI also imports products from world-class multinational

companies like ASTRAZENECA, UK; UCB, BELGIUM and ELI LILLY, USA and

markets world-renowned brands like Diprivan, Fluothane, Nolvadex, Humulin, Ceclor etc.

in Bangladesh.

Exports: To fuel the continuous growth of ACI, the company has started exploring

international markets. The quality of ACI products, strengthened by its ISO 9001

certification, has brought immediate success in Sri Lanka, Yemen and Myanmar.

Human Resource: Total number

of permanent employees is 1181

out of which 778 are engaged in

sales and customer services.

Business Description: ACI as a

whole is a company with annual

turnover more than BDT 2500 MM

where ACI pharma contributes 40% of the total sales. ACI is the first company in

Table 27: Financial Snapshot ACI Limited

(Figures in BDT) 2003 2002 2001

Sales 2,239,565,258 2,052,913,536 1,637,408,231

Cost of goods sold (1,600,211,511) (1,422,247,548) (1,184,074,252)

Gross profit 639,353,747 630,665,988 453,333,979

Provision before tax 93,440,211 163,602,582 136,715,428

Provision after tax 85,413,760 109,180,668 91,715,428

Retained Profit 125,820,859 117,230,026 69,823,582

Share Capital 161,700,000 161,700,000 161,700,000

Tax Holiday reserve 2,187,562 2,576,385 1,439,661

At Cost/revaluation 488,071,274 415,289,749 367,122,500

Investment 189,419,241 161,696,791 127,588,791

Net Current Asset 1,243,623,034 870,761,136 609,920,107

Long term liabilities 152,776,863 192,222,033 206,400,779


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Bangladesh to obtain certification of ISO 9001 Quality Management System in 1995. ACI

is also the first Company in Bangladesh to get certification of ISO 14001 Environmental

Management System in 2000. ACI employees are proud of their work culture, business

ethics and environmental consciousness. ACI follows International Standards on Quality

Management System to ensure consistent quality of products and services to achieve

customer satisfaction. ACI also meets all national regulatory requirements relating to its

current businesses and ensures that current Good Manufacturing Practices (GMP) as

recommended by World Health Organization is followed for its pharmaceutical operations.

ACI is committed to maintain the harmonious balance of our eco-system and therefore

constantly seeks ways to manufacture and produce products in an eco-friendly manner so

that the balance of nature remains undisturbed and the environment remains sustainable.

4.13.7 ESKAYEF BANGLADESH LIMITED

Brief History: Eskayef Bangladesh

Limited, a successor of SmithKline &

French in Bangladesh, is one of the

country's fastest growing top ten

pharmaceutical companies. They

manufacture and market a wide range of

therapeutic drugs, pharmaceutical raw

materials and animal health and nutrition

products. They are one of the members of

the Transcom Group of Companies, a

leading conglomerate in Bangladesh. The

Table 28: Financial Snapshot Eskayef(Figures in BDT

MM) 2003 2002 2001 2000

Revenue 921,671 949,450 659,755 532,738

Cost of goo

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