[🇧🇩] Pharmaceutical and Chemical Industry in Bangladesh

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Beximco Pharma seeks to free itself from group entities' troubles

Beximco Pharmaceuticals is set to overhaul its board and sever a key link with its embattled sponsor group as the drug maker seeks to shield its business and investors from the political fallout surrounding Vice Chairman Salman F Rahman. Mr Rahman has agreed to step down from the board after the c

thefinancialexpress.com.bd

Beximco Pharma seeks to free itself from group entities' troubles

Beximco Pharmaceuticals is set to overhaul its board and sever a key link with its embattled sponsor group as the drug maker seeks to shield its business and investors from the political fallout surrounding Vice Chairman Salman F Rahman.

Mr Rahman has agreed to step down from the board after the company informed the Bangladesh Securities and Exchange Commission (BSEC) that his continued involvement could hamper business and shareholders' interests.

His departure would mark a significant shift in governance for one of the country's largest listed drug makers, whose corporate fortunes have increasingly been overshadowed by the legal and financial troubles that have entangled the Beximco Group, market operators said.

BSEC Executive Director and spokesperson Md Abul Kalam said Beximco Pharma had recently sent a letter to the regulator regarding the restructuring of its board.

However, he said the restructuring process would depend entirely on the company, including decisions on who would remain on the board and who would step down.

"When the appointment of independent directors comes before the regulator, the commission will examine whether the proposed candidates meet the criteria," Mr Kalam told The Financial Express.

Mr Rahman, former private industry and investment adviser to the Awami League government, has remained in custody since his arrest in August 2024 following the political changeover. He is currently under investigation by the Anti-Corruption Commission (ACC) in several money-laundering cases.

Mr Rahman's continued physical absence from board meetings has emerged as a concern for investors, particularly foreign investors, amid the changed political and regulatory environment.

The reconstituted board, as proposed by the company, would comprise three sponsor-group directors, four independent directors, one director nominated by IFIC Bank and the managing director as an ex-officio director, according to BSEC sources.

The securities regulator has reportedly responded positively to the proposed structure.

The new structure would have the sponsor group's representation reduced while the number of independent directors would increase amid investors' demand for stronger corporate governance and a greater distance from the Beximco Group.

Foreign shareholders, who hold a significant 26.90 per cent stake in Beximco Pharmaceuticals, reportedly supported Mr Rahman's removal from its board in the interest of the company.

Initially, the BSEC invited foreign investors to take board seats, but they declined, prompting the regulator to move towards increasing the number of independent directors, according to a BSEC official requesting anonymity.

Dual-listed on the London Stock Exchange's Alternative Investment Market (AIM), Beximco Pharma must subject all incoming directors to standard international due diligence. The vetting process is expected to take four to six weeks.

Governance key to investor confidence

Market operators said the key issue is not merely the departure of an individual director, but whether the reconstituted board can exercise greater independence, strengthen oversight and protect investors' interests.

Salim Afzal Shawon, head of research at BRAC EPL Stock Brokerage, welcomed the move, saying the proposed restructuring, if implemented properly, could help insulate Beximco Pharma's operating business from the wider group's governance and financial problems.

"The restructuring could send a positive signal to investors about the company's prospects, particularly if the new board can demonstrate greater independence, transparency and accountability.

"The key issue now is who will join the new board, attend board meetings physically and actively participate in decision-making," said Mr Shawon.

Company Secretary Mohammad Asad Ullah could not be reached for comment.

Earnings remain strong

The board restructuring comes at a critical time for Beximco Pharma. While the company has shown financial resilience, governance issues remain a major concern.

The company reported a profit of Tk 7.05 billion for the first nine months through March this year, up 34 per cent year-on-year, while revenue rose 13 per cent to Tk 41.42 billion during the period.

The drug maker's annual profit also jumped 19 per cent year-on-year to Tk 6.99 billion in FY25. The company declared a 47.5 per cent cash dividend for the year, compared with 40 per cent for the previous year.

Its earnings performance has stood in sharp contrast to the financial difficulties faced by some other entities within the Beximco Group, reflecting the strength and resilience of its core pharmaceutical business.

Unlike some group entities facing heavy debt burdens and liquidity pressure, Beximco Pharma has continued to generate strong revenue and profit from its operating business, supported by steady demand for medicines in both domestic and export markets.

London listing

The restructuring also carries additional significance because Beximco Pharma has an international investor base and is listed on the London Stock Exchange (LSE).

The foreign listing exposes the company to greater scrutiny by international investors, who typically place strong emphasis on transparency, board independence and timely financial reporting.

Meanwhile, trading in Beximco Pharma resumed on the LSE in June after a nearly six-month suspension due to the delay in the publication of its financial statements.

Beximco Pharma's stock closed at Tk 149.70 on Tuesday, gaining 1.42 per cent from the previous session at the Dhaka Stock Exchange.​

 

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https://www.dhakatribune.com/business/420952/us-grants-duty-free-access-for-specialized

Bangladesh part of region to enjoy US duty-free access for specialized medicines

This decision comes at a time when the US is moving forward with a process to impose a 100% tariff on certain patented pharmaceutical products

The United States has made a significant shift in its international trade policy. Washington has exempted specified specialized medicines and related ingredients imported from 20 partner countries and regions, including Bangladesh and India, from import tariffs.

This decision comes at a time when the US is moving forward with a process to impose a 100% tariff on certain patented pharmaceutical products.

According to a report by Indian news agency ANI, the US Department of Commerce published an official list in the country's Federal Register to formalize this new tariff structure.

The publication specifies the names of the countries and regions covered under the zero-tariff benefit, along with the corresponding product categories.

Under the directives, duty-free products include medicines used to treat rare diseases, fertility treatment drugs, advanced cell and gene therapies, antibody-drug conjugates (ADCs), and veterinary medicines.

Basic ingredients or raw materials—Active Pharmaceutical Ingredients (APIs)—used to manufacture these medicines will also receive the 0% duty privilege.

In addition to Bangladesh and India, the list of countries and regions receiving duty exemptions includes Argentina, Cambodia, Ecuador, El Salvador, the European Union (EU), Guatemala, Indonesia, Japan, Jordan, Malaysia, North Macedonia, South Korea, Switzerland, Liechtenstein, Taiwan, Thailand, the United Kingdom, and Vietnam.

According to the official notice, the specified goods exported from these countries and regions will receive 0% tariff benefits because they have active or prospective trade and security framework agreements with Washington.

The basis for this change stems from an April directive by President Donald Trump.

Under Section 232 of the Trade Expansion Act, that announcement directed a modification in the tariff structure for imported pharmaceutical products and related chemical ingredients.

Earlier, the original April 2 announcement imposed a 100% tariff on specified patented medicines, biological products, and related components.

Boosting domestic manufacturing of these products within the United States was the broader objective of this policy.

For companies on the primary list, tariffs took effect on July 31, while for other listed companies, the tariff becomes effective on September 29.

However, the US Department of Commerce confirmed that generic medicines and ingredients used to make them remain excluded from Section 232 pharmaceutical tariffs.

Recent administrative amendments have also introduced key technical changes to the original announcement.

As a result, the definition of "generic pharmaceutical articles" has been further clarified to include off-patent veterinary drugs.

At the same time, the scope of what constitutes "pharmaceutical articles" has been specifically defined.

This category will strictly include finished pharmaceuticals, active pharmaceutical ingredients (APIs), and key advanced starting materials.​

 

[Saif]

API production: the missing link in Bangladesh's pharma success story

Bangladesh's pharmaceutical sector is often celebrated -- and rightly so -- for its remarkable achievements over the past two decades. From being an import-dependent industry, it has grown into one of the country's most dynamic manufacturing sectors, meeting nearly 98 per cent of domestic demand fo

thefinancialexpress.com.bd

API production: the missing link in Bangladesh's pharma success story

Bangladesh's pharmaceutical sector is often celebrated -- and rightly so -- for its remarkable achievements over the past two decades. From being an import-dependent industry, it has grown into one of the country's most dynamic manufacturing sectors, meeting nearly 98 per cent of domestic demand for medicines and exporting to more than 150 countries. Its consistent growth -- estimated at more than 24 per cent annually -- underscores its role as one of the strongest pillars of the economy after garments. Yet, behind this impressive success lies a persistent vulnerability: the overwhelming dependence on imported raw materials, known in the industry as active pharmaceutical ingredients (APIs).

At present, nearly 90 per cent of the APIs used in Bangladesh are imported, mainly from China and India. The annual import bill stands at around Tk 45 billion, while local production is able to meet no more than 10 per cent of industry demand. This stark imbalance makes the entire pharmaceutical sector hostage to external factors -- global supply chain disruptions, price volatility, and shifting trade policies. The COVID-19 pandemic exposed this fragility more sharply than ever before, when border closures and supply interruptions forced manufacturers to scramble for essential raw materials.

Reducing reliance on imported APIs has, therefore, been a recurring theme in industry discussions for well over a decade. Despite repeated promises and policy outlines, progress on this front has been painfully slow. Now, however, a renewed push is underway. The government is implementing an API Industrial Park in Munshiganj, while two other parks are being developed in Bagerhat and Khulna under private initiatives. The hope is that once these are in place, Bangladesh's pharmaceutical industry will be able to scale up production at lower costs, both for domestic markets and exports.

The importance of such backward linkages cannot be overstated. A capital-intensive sector like pharmaceuticals cannot remain competitive in the long run without affordable and steady access to raw materials. Much of the unrealised potential of the industry can be traced back to this very weakness. While local drug makers have proven their capacity in manufacturing finished formulations of international standard, they remain handicapped by the shortage of APIs. The end result: higher production costs, thinner profit margins, and diminished export competitiveness.

The Munshiganj API Park is expected to be a game changer in this respect. Built on 200 acres of land along the Dhaka-Chattogram Highway in Gazaria upazila, the estate cost Tk 3.30 billion and took nearly 12 years to come to fruition after the project was first undertaken in 2008. Progress, however, has been sluggish, with only a few units reportedly close to becoming operational. Industry insiders maintain that if the park can be made fully functional, it could cater to as much as 50-60 per cent of the country's total demand for APIs. Even so, patent restrictions will prevent Bangladesh from producing all varieties of APIs, meaning some reliance on imports will continue.

Despite these limitations, the benefits of developing a robust API industry are considerable. For one, local production will substantially reduce the cost of manufacturing medicines, strengthening Bangladesh's edge in export markets where price competitiveness is critical. Second, APIs themselves are tradable commodities, and the global market -- currently estimated at $135 billion -- is expanding rapidly. By developing capacity in this segment, Bangladesh could position itself not only as a major exporter of finished drugs but also as a reliable supplier of raw materials to the global pharmaceutical chain.

Some local companies are already making strides in this direction. A few firms have begun producing high-quality APIs on a limited scale, demonstrating both technical capability and market viability. What is missing is the scale -- something that requires coordinated policy support, investment in infrastructure, and stronger linkages with research and innovation. Industry experts stress that the sector needs the right "push" -- a mix of incentives, facilitation, and enforcement of quality standards -- to reach a level where it can sustain itself competitively.

The urgency of this transformation cannot be ignored. Bangladesh currently spends around $1.3 billion annually on importing raw materials for medicine production. Given the volatility of international markets and the likelihood of future supply disruptions, over-reliance on imports is not sustainable. For a country aspiring to graduate fully into middle-income status and expand its export basket beyond garments, building backward linkages in pharmaceuticals through local API production is not just desirable but necessary.

The road ahead is not without hurdles. Patent barriers, high costs of research and development, and the need for stringent regulatory oversight pose real challenges. The time it takes for new industrial estates to become fully operational is also a concern, as seen in the protracted delays at Munshiganj. Still, the long-term gains far outweigh the difficulties. By investing strategically in API production, Bangladesh has the opportunity to reduce vulnerabilities, secure its domestic market, and create a new export frontier.

Bangladesh's pharmaceutical sector has already proven its potential by achieving near self-sufficiency in medicine production and emerging as a global player. The missing piece of the puzzle is a strong, sustainable base for raw material supply. If the government and private sector can work together to accelerate API production, the industry will be poised to take its next great leap forward. Not only will it make medicines more affordable at home, it will also enhance Bangladesh's standing in the global pharmaceutical arena. The challenge is significant, but the opportunity is even greater -- and one that the country can ill afford to miss.​