BANGLADESH鈥橲 graduation from the least developed country (LDC) status in November 2026 marks an important milestone in its socio-economic development. However, the country may face formidable challenges due to the loss of the benefits arising from LDC-specific support measures. Well-thought-out strategies and proactive measures will be required to address these challenges and to ensure a smooth transition. The case of Bangladesh is of particular interest to the UN and the global community, as it has the largest economy in terms of GDP among all LDCs, far larger than any of the eight countries that have already graduated, and, remarkably, remains the only LDC with a highly developed and organised pharmaceutical industry.
The pharmaceutical industry in Bangladesh remains a success story. The sector has made commendable progress over the last few decades, and the country is now nearly self-sufficient in pharmaceuticals, with 98 per cent of its demand met by local manufacturers. At present, this is one of the most technologically advanced sectors in the country, employing what is probably the highest number of white-collar professionals. Since the promulgation of the Drug Policy in 1982, the sector has grown from Tk 173 crore to almost Tk 37,000 crore today, and Bangladeshi medicines are now exported to more than 100 countries, including the United States, the world鈥檚 largest and most stringent pharmaceutical market. Thanks to significant private sector investment in both infrastructure and human capital, the industry has successfully transformed itself from import-dependent to export-oriented.
The pharmaceutical sector has played a vital role in Bangladesh鈥檚 healthcare achievements by providing medicines at highly affordable prices. In fact, the price of medicine in Bangladesh is among the lowest in the world, even more affordable than in many neighbouring countries. As an LDC, Bangladesh has benefitted from the TRIPS waiver, which exempts it from recognising patent protection for pharmaceuticals. This has greatly supported the growth of the sector and enabled it to produce many patented and breakthrough medicines, making them affordable for the population. During the COVID-19 pandemic, Bangladesh made global headlines by introducing generic versions of all major breakthrough COVID-19 drugs, many of which were supplied free of cost to government hospitals. For a low-income country like Bangladesh, it would have been impossible to afford patented, life-saving medicines had they not been manufactured locally. Similarly, a number of patented biological drugs for chronic diseases and cancer are being produced in the country and made accessible to patients at lower cost.
Although seminars, workshops and roundtables are frequently organised on the economic impact of LDC graduation, there is, shockingly, hardly any actionable strategy or preparation in place to face the post-LDC challenges.
For the pharmaceutical industry, these challenges are particularly daunting. The TRIPS patent waiver for LDC pharmaceuticals until 2033 will no longer apply to Bangladesh after 2026, which means that the country will be required to recognise product and process patents. As a result, patented drugs cannot be manufactured without paying royalties, and new-generation therapies such as biosimilars and vaccines will be difficult to introduce or produce due to patent barriers. This will cause medicine prices to rise substantially, making them unaffordable for the majority. Access to medicines will also be seriously hampered, especially as out-of-pocket expenditure in Bangladesh exceeds 70 per cent, one of the highest levels in the world. In addition, the market risks being flooded with imported non-essential and low-quality products. The active pharmaceutical ingredient (API) industry will face challenges too, as patented APIs cannot be manufactured locally, while exports will suffer because new drugs cannot be sent to other LDCs. Furthermore, breakthrough medicines will not be easily launched in times of national emergency, such as a pandemic, due to patent restrictions. The local industry will face tremendous competition from foreign companies, while policy support such as subsidies or cash incentives may not be permissible under the WTO Agreement on Subsidies and Countervailing Measures. As a result, all relevant policies will need to be revised in line with WTO obligations. To complicate matters further, Bangladesh is ill-prepared to face patent-related challenges from multinational companies due to the serious lack of capacity in its patent office and other relevant authorities.
Given these impending challenges, it is urgent to prepare for the post-LDC scenario. Bangladesh must fully utilise existing benefits until the waiver period ends, accelerating the registration of new drugs, especially biosimilars, and maximising drug approvals during the transition period. The long-delayed API park must be made fully operational without further setbacks. Greater backward integration into API production is essential to reduce import dependence and improve competitiveness, while particular focus must be given to developing synthetic chemistry skills and ensuring ESG compliance. New-generation therapies, particularly biosimilars and vaccines, must be prioritised as they represent the future of medicine, and the government should support the building of capability and scale in these areas. An ecosystem of innovation and basic research must also be developed, with collaboration between the public and private sectors. Expatriate scientists should be attracted back, and opportunities for advanced research should be created, supported by government incentives to encourage research and innovation.
The Patent Act of 2023 has already incorporated TRIPS flexibilities to safeguard public health, but greater awareness of intellectual property rights and TRIPS issues must be promoted among all stakeholders, including government officials, private sector representatives, academia, the judiciary and the media. Serious reforms and capacity building are needed in the field of intellectual property, with adequate manpower and resources in the Patent Office. University curricula should also be updated to align with contemporary needs and trends, particularly in areas such as technical expertise, regulatory knowledge and intellectual property. Lessons can also be learned from India, where a lucrative production-linked incentive scheme has strengthened local manufacturing of pharmaceuticals, APIs and medical devices. Bangladesh must also develop contract research organisations, advanced testing laboratories and other supporting infrastructure, while strengthening capabilities across the entire pharmaceutical value chain, including basic research, manufacturing, API/KSM production and clinical research. At the same time, the country must build capacity in trade negotiation to properly assess the economic benefits and risks before signing free trade agreements, economic partnership agreements or the Patent Cooperation Treaty. India鈥檚 transition provides further useful lessons, including the creation of a separate Department of Pharmaceuticals under the ministry of commerce, the establishment of dozens of SEZs to promote export, and the founding of specialised institutes for advanced pharmaceutical skills.
Many argue that strict IPR enforcement, as often prescribed by multinational companies from developed countries, will enhance the country鈥檚 image and attract foreign direct investment. However, given Bangladesh鈥檚 socio-economic challenges, especially where public health is concerned, the priority must be to protect the interests of its people. The Bangladesh Patent Act 2023 has judiciously incorporated safeguard measures permitted under WTO/TRIPS agreements to protect public health and support the country鈥檚 smooth graduation from LDC status.
Pharmaceuticals constitute a knowledge-driven and technology-intensive industry, requiring significantly higher R&D investment than most other sectors. Its success depends largely on intellectual capital and specialised skills at every stage of operation. Graduation from LDC status therefore necessitates a strategic shift towards strengthening research and development to mitigate potential challenges and remain competitive in the global market. This cannot be achieved overnight. The government and private sector must collaborate to create an ecosystem of innovation and to strengthen capabilities across the entire pharmaceutical value chain.
听
Dr Shawkat Haider is a healthcare expert and executive director of Beximco Pharmaceuticals.
