Among the many difficulties the country is poised to face in the post-LDC period, particularly in the trade arena, is the termination of benefits meant for the LDCs. While the main bite will take the form of non-availability of preferential treatment under various schemes including that of the Generalised System of Preferences (GSP) for exports, there are others that Bangladesh as a LDC is still entitled to. In case of pharmaceutical production, Bangladesh, like most other LDCs, can enjoy a comfortably long transitional timeframe to manufacture generic drugs until 2033. But the country is not going to sit that long with the LDC baggage to avail the benefit. If things move as predicted, Bangladesh will leave the LDC group by 2024.
So, once the prevailing facility is withdrawn, the country's pharma industry will face tough challenge in that it will have to obtain licences from the patent-holding drug manufacturers which will considerably raise their production cost, beside exposing them to stiff global competition. In this context, it may be recalled that the World Trade Organisation's (WTO) 10th ministerial meeting held in Nairobi, Kenya in 2015 decided in favour of allowing the LDCs sufficient breathing time before they are ready to comply with the rules regarding pharmaceutical patents. According to that ministerial declaration, LDCs will be allowed to maintain maximum flexibility in their move to patenting pharmaceutical products until at least 2033. The breathing time is crucially needed as most of the LDCs are still not in a position to manage a well-structured pharmaceutical industry. Besides, paying hefty licensing fees and fulfilling stringent compliance rules, quality assurance and so on might pose too daunting a challenge for many of them. Although, compared to most LDCs, Bangladesh's pharmaceutical industry is far better organised, the fact remains that the industry has so long thrived on generic medicines, and hence parting with the generics and entering the patent regime, without being well prepared, may find the sector ill at ease even after another five years (2024) -- the year Bangladesh is expected to part with the LDC league.
A report published in the FE the other day says that the government is preparing to seek extension of TRIPS privileges, particularly those related to pharmaceuticals, even after Bangladesh ceases to remain an LDC, in order to safeguard local pharma industry from the ensuing patent regime. Obtaining a waiver may not be very easy, as big global pharma players will strongly oppose such a move. Bangladesh will thus need to plan how to go about it, preferably by asking for an extension, but not as long as that allowed to LDCs till 2033. Meantime, the local industry must do the needful to be able to face the challenges.
According to industry insiders, Bangladesh is capable of producing high-quality products as the industry employs state-of-the-art manufacturing facilities, sophisticated quality control equipment and skilled human resources. Over the last three years, it has been learnt that approximately $250 million was invested in the sector and preparations are reportedly afoot to raise the investment to $ 1.0 billion in as many years to come. So, preparations should be afoot to rise up to the challenges.
© 2017 - All Rights with The Financial Express