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12:00 AM, August 30, 2020 / LAST MODIFIED: 02:05 AM, August 30, 2020 Australian biotech firm to set API plant at BSMSN for $30m Jagaran Chakma Australian biotechnology company HA TECH will invest up to $80 million, or roughly Tk 700 crore, to establish a large-scale active pharmaceutical ingredient (API) manufacturing facility in Bangladesh that could help the country meet its growing demand. "We aim to fulfil the demand for quality APIs in Bangladesh," Abdullah Al Mahmud, executive chairman of HA TECH, told The Daily Star. Initially, the Sydney-based company, which produces APIs mainly for cardiovascular, diabetic, ulcer and oncology applications, will invest $30 million to develop the facility. But within the next five years, the total investment could reach $80 million if the company wants to increase the product range. There are about 10 local companies, including Eskayef, Square, Beacon and Beximco, that produce API materials on a limited scale, according to SM Shafiuzzaman, secretary general of Bangladesh Association of Pharmaceutical Industries (BAPI), a collective of about 250 local drug markers. Local production can at best meet 5 or 6 per cent of the annual demand from the pharmaceutical sector, which has only grown in stature with the onset of the coronavirus pandemic, according to Monjurul Alam, director for global business development at Beacon Pharmaceuticals. Subsequently, Bangladesh spends about $1.3 billion each year to import APIs from the US, Taiwan, Italy, Germany, Spain, Switzerland, France and the UK. Development works for HA TECH's upcoming state-of-the-art good manufacturing practice (GMP) facility spanning 10 acres on at the Bangabandhu Sheikh Mujib Shilpa Nagar (BSMSN) will begin in January, said Paban Chowdhury, executive chairman of the Bangladesh Economic Zones Authority (BEZA). HA TECH and BEZA signed the land lease agreement on 25 August. The facility is expected to go into full operation by sometime next year. Securing more foreign direct investment (FDI) for the country's Tk 22,000 crore-pharmaceutical industry, particularly API manufacturing, is crucial for propping up the sector, Chowdhury said. About 98 per cent of the annual domestic demand for pharmaceutical products is met by BAPI members. After meeting the local demand, the products are shipped to 144 different countries. Pharmaceutical shipments rose 4.5 per cent year-on-year to $136 million in fiscal 2019-20 following improvements in product quality and policy support. The National Board of Revenue recently declared that imports of API products, pharmaceutical raw materials and reagents would be exempt of VAT until 2025 in a bid to boost the sector. However, the tax authority also imposed a condition on API producers that require them to spend at least 1 per cent of their annual turnover on research and development projects for them to avail the benefit. The minimum value-addition should be 60 per cent. "Our pharmaceutical sector will contribute to export diversification. Therefore, BEZA always welcomes API manufacturers at economic zones and is ready to roll out the red carpet, if needed," he added. There is a huge potential to invest in API manufacturing in Bangladesh, said Beacon Pharma's Alam. The reason being, the pharmaceutical sector is expected to grow 15 per cent year-on-year to reach $5.1 billion by 2023, propelled by investments from local companies that seek to grab a bigger share of the global market, according to an estimate. Mahmud though is buoyant that HA TECH's facility will become a manufacturing hub for a range of finished pharmaceutical products as well. This includes nucleic acid drugs that use oligonucleotide, which is one of the newest segments of innovative medicine. https://www.thedailystar.net/business/news/australian-biotech-firm-set-api-plant-bsmsn-30m-1953261

Since our country will be graduating from the LDC status in 2026, Bangladeshi pharma companies will loose the free patent license as per WTO rules.