Australian biotech firm to create API plant at BSMSN for $30m
Australian biotechnology company HA TECH will invest up to $80 million, or roughly Tk 700 crore, to determine a large-scale active pharmaceutical ingredient (API) manufacturing facility in Bangladesh that may help the united states 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 build up the facility.
But next five years, the total investment could reach $80 million if the business wants to boost the product range.
There are about 10 local companies, including Eskayef, Square, Beacon and Beximco, that produce API materials on a restricted 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 twelve-monthly 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 every 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 commence 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 likely to go into full procedure by sometime next year.
Securing more foreign direct investment (FDI) for the country's Tk 22,000 crore-pharmaceutical industry, particularly API manufacturing, is essential for propping up the sector, Chowdhury said.
About 98 per cent of the gross annual domestic demand for pharmaceutical products is met by BAPI members. After meeting the neighborhood demand, the merchandise are shipped to 144 different countries.
Pharmaceutical shipments rose 4.5 % 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 recycleables and reagents will be exempt of VAT until 2025 in a bid to improve the sector.
However, the tax authority also imposed a condition on API producers that want them to spend at least 1 % of their gross annual turnover on research and development projects for them to avail the power. The minimum value-addition ought to be 60 per cent.
"Our pharmaceutical sector will donate to export diversification. Therefore, BEZA always welcomes API manufacturers at monetary zones and is preparing to roll out the red carpet, if needed," he added.
There exists a huge potential to invest in API manufacturing in Bangladesh, said Beacon Pharma's Alam.
For the reason that, the pharmaceutical sector is likely to grow 15 % 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 can be a manufacturing hub for a variety of finished pharmaceutical products aswell. This consists of nucleic acid drugs that use oligonucleotide, which is among the newest segments of ground breaking medicine.
