Expiry of TRIPS waiver unlikely to harm drug exports

Incepta Pharmaceuticals Ltd is a leading pharmaceutical company with good command in the domestic medicine market and supplies to 67 countries. Established in 1999, Incepta has expanded its operations in API and human vaccines. In a conversation with The Business Standard, Incepta Chairman and Managing Director Abdul Muktadir shares his thoughts on the future of Bangladesh's pharma industry after phase-out of TRIPS privilege as well as reveals his company's plan to collaborate with global research organisations to advance further in innovations and technological efficiency.

What are the big challenges waiting for our pharma industry after 2033 when the TRIPS waiver will end? Are we prepared?

In fact the industry is going to face the challenges from 2024, not from 2033. Bangladesh is set to graduate from LDC in 2024. There is every possibility that we won't continue to enjoy the provision that has been given by the TRIPS for LDCs. We'll have to be prepared to face the challenges from 2024.

There are two different kinds of challenges we may face.

Number one is we will be facing a patent regime. So all the newly-introduced productions that are going to be marketed after 2024 will come under patent protection. And we'll not be able to introduce those in Bangladesh's market as freely as we do now. But the products introduced in the market within 2024 will remain out of the patent regime for our local market. We are taking initiatives to get those products registered with our Drug Administration, so that we can continue their production and give the benefit of those medicines to our people beyond 2024. Although the patent right is going to be there, we'll be able to continue to produce those without giving royalty since we had introduced those medicines before 2024.

After 2024, only patent holders or their licensees will be allowed to introduce their patented products in Bangladesh. They will have the monopoly and sell their products at higher prices. Then we'll have no other option but to buy those at higher prices. These are inevitable and we would not be able to avoid such scenarios. However, the share of such drugs would not be too significant to have a big impact on the overall treatment process.

The other issue which is very important is that Bangladesh's pharma industry is exporting a lot of products to the developed world and many developing countries. We are not currently selling any patented drugs to most of our export destinations. We are selling those products without patents or whose patents have already expired. And we'll be able to continue to produce and sell those items. So there will be virtually no impact on our exports.

Even after 2024?

Even after 2024. The products which we are currently exporting will continue to get access to export markets without any problem. Rather, our exports to those markets will increase. As we continue to strengthen our industry by producing API of our own, we'll stay competitive. So our exports will grow and our market share in developed countries will increase tremendously.

How long should we be at the receiving end—be it generic drugs or vaccines? Is it because our pharma industry has not cared enough for R&D?

This is a question many ask: How good are our research and development (R&D)? If you look into the introduction of new products in the global market, you will see that most of them are results of collaborative research work between the industry and universities. Just take a look into the recently introduced Covid-19 vaccines. One is the Oxford vaccine, which is developed by a university. AstraZeneca is a very big research-oriented company, but the vaccine is not their research work. It is the result of Oxford University research. Now come to Moderna and BioNTech. Pfizer is probably the biggest pharmaceutical company in the world, but the vaccine is not its discovery. It is the research of BioNTech. It is actually a biotechnology research firm which was doing research on cancer drugs and took the advantage of pandemic time, redirecting its research to develop Covid-19 vaccine.  The case is the same for Moderna, which is a biotechnological research-based company and has developed their own vaccine.

So, you see, none of the established, world's largest, R&D-based pharmaceutical companies could do it for themselves. It is a collaborative effort between the industry and academia. Once we have this kind of academic institution in our country, Bangladesh will also introduce such pharma products. Please try to understand it's a collaborative effort and research is primarily done in universities. I believe, someday this will happen in Bangladesh too and we will go forward.

What is the impediment to such collaboration in our country? We have BSMMU, other universities with biotechnology departments. Are they not willing to collaborate?    

We don't have any such institution where this kind of drug discovery research is going on. This is why we are unable to have such discovery. 

Is that because of lack of lab facilities? Or is there a skill gap?

This is a good question. How can we develop such programmes so that our institutions can also start drug development? Our educational institutions are currently focused on solving problems related to treatment. They are educating their pupils to take care of the present situation. I think, as we advance with time, they will become at par with global standards, which they have not achieved yet. So we have to wait. We are developing. Once we achieve a certain level, we'll be able to put more money in basic scientific research. Only then can we expect new drug development.

Look into our allocation of funds for research. How much do we allocate in this area? Just a small amount. We don't have the capability to make resources available for research so that institutions can work on drug discovery. We don't have the infrastructure yet. Once we have those, we will definitely see the results. 

Do we have the skills?

No, we don't have that. Neither do we have skills, nor do we have adequate knowledge at this moment. It would require proactive policy and regulatory support. We hardly have any such infrastructure as yet. Just for the last two or three years, it started developing. We didn't have the guideline, law, structure, or policy for such research. The government is now slowly developing those prerequisites and talking about research occasionally. Institutions are being equipped to support such research. These are very complex things. And we are just getting into the process of development. It is a completely different topic that requires more discussion. The real answer is, we have not yet reached that level. We have the intelligence, the ability to go there. Now we have to frame required law, policy, and will have to provide adequate support and funds. We have institutions, but their curricula are focused more on immediate needs, not on forward looking research works.

Still, is there scope for collaboration between the industry and universities as you mentioned?

Of course. We are willing to collaborate with universities. We are making only small steps today. We can reach bigger goals tomorrow. There are many problems that universities can solve for the industry. So there should be more and more engagement between the industry and academia. And we should do it. We are willing to do so. It has already started and hopefully, it will go a long way. 

There is a perception that drug makers have to spend much on doctors to encourage them to prescribe their drugs, which adds to medicine cost. Is there any truth in it?

Very interesting question. Most of the time people ask this question if drug companies spend money for doctors and probably this adds to medicine prices. But if you look into medicine prices in Bangladesh, you will find the prices to be cheaper compared to overseas prices. When I talk to people who travel outside the country for treatment, they say the price of medicine there is so high compared to that in Bangladesh. That is the reason you would see many diasporas buy medicines from Bangladesh. 

There is a big difference in medicine prices between Bangladesh and overseas. Medicine prices are extremely low in Bangladesh. This is why you will see most of the new pharmaceutical companies cannot survive because they cannot keep prices so low as old companies can. Only those companies which have long been in business and have a certain scale of economy, can remain in business. For the sake of accessibility of medicines used by vulnerable groups, we sell some drugs at low cost. 

One such example is paracetamol syrup which is probably the highest-sold product in terms of unit. It is sold at a lower price than our actual cost. But the industry does not get appreciation for such a good gesture. Some people think that drug companies can still reduce the price. To tell you very frankly, there are products which we are selling at the same price for the last 30 years. This is unimaginable.  But this is what is happening in Bangladesh. Our pharmaceutical companies are providing you the highest quality products at minimum prices only because of intense competition among companies. Since there are many companies making the same drugs, there is intense competition to keep prices low. The industry keeps a balance where prices are low and quality is high.

Isn't there a scope for compromising on quality in that case?

If there is any such malpractice, in no way it can be supported. But if you look into the market share, you  will see that the top 10 to 15 companies control 95% of the market. All of them are fighting with each other to improve the quality even further. Even then, there might be certain elements which may do otherwise and we do not encourage such practice. People also reject those ultimately. Otherwise, they would have a higher market share. People have wider options to choose products from a number of good companies.

Many believe that companies produce superior quality drugs for exports and inferior quality drugs for the local market due to poor supervision of the Drug Administration. Is it true?

The monitoring of the Drug Administration has been continuously improving for the last several years because of the increased focus on quality and supervision from the WHO. And the quality of the product is also getting better and better. There is no such thing as high quality for export and low quality for the local market. This is a big misinformation among people. In fact, all the big companies which are now exporting medicines cannot produce low and high quality medicines at the same time.  They have installed a quality management system, which is the same for the UK as it is for Bangladesh. Since Bangladesh's drug companies are becoming global, their quality management system must be of global standard. Quality practices are improving both within the companies and across the industry. We cannot operate two different quality systems in a factory—one for export and the other for local. The Drug Administration has also adopted the WHO-endorsed quality management system, which is harmonised with and similar to that in other developed countries and overseas. There is a transformation through which the Drug Administration as well as the industry are going through leading to production of harmonised world class medicines. 

A paracetamol or antacid tablet produced in the USA sometimes works better than one produced in Bangladesh. Unsure about the efficacy of local drugs, doctors here often prescribe double doses. Why does this happen? Are local drugs produced with low-latency ingredients imported from abroad at a cheaper price?

The dosage range for antacids and paracetamol is very wide and severity of condition also varies, requiring a varied degree of dosage regimen. Confusion may arise from such individual conditions. Moreover, we hear this kind of opinion from some quarters who always think anything made here in Bangladesh is of a lower quality. This is a kind of perception and it probably stems from very old experiences of some people. Things have changed a lot during the last 20 years. The drug industry in Bangladesh has completely changed and it is now producing drugs for the whole world and the quality of products is exactly the same as you get in any advanced country. So, I would urge our fellow citizens to remove any such perception and have full confidence in our medicines. The drugs meant for blood pressure, diabetes and other critical diseases provide desired results without any failure so paracetamol or antacids should not be any exception. 

How drug makers can help reduce overuse of antibiotics?

We don't encourage overuse of antibiotics. You never see any drug company going and telling people: 'Hey you, come and buy our antibiotics!' Many would say antibiotics may be overused in Bangladesh. This is a matter of debate. If it happens somewhere, it should be taken up with the doctors who are supposed to prescribe those only when needed. Lots of advocacies are going on and I think this has been addressed to a great extent. In Bangladesh people can buy any drug from pharmacies without a prescription. Public awareness needs to be raised to stop this practice. And it's not for antibiotics alone, but for all medicines. It should be our philosophy that people won't buy medicines without a prescription by a properly trained and licensed medical professional.         

While the country is inviting FDI, many foreign drug companies are leaving Bangladesh. Are they failing to compete, or is it something else? 

That is a very interesting phenomenon. Not from Bangladesh alone, some multinational drug companies are leaving many developing countries. The key reason is that their pricing policy and their profitability equation are quite different from ours. They see this particular business as a headache as it does not ensure them the amount of profit they have in mind. Here medicine prices are low, hence they do not find it quite interesting to stay in business here. For them, it is simply an extra management load without much reward and therefore, they do not find it interesting. 

Do you think their presence could benefit our industry through technology transfers?

We have hardly seen any such company transferring technology whereby we can get benefit. We have tried, but never received any technology from them. Either we have to buy the technology we need, or go for reverse engineering to develop that on our own. This is how we bring in modern technology in Incepta production facilities. Let's give you some examples. We are the first company in Bangladesh to have vaccines and biosimilar drugs. We have launched these products for which we never received any technological know-how from any Western company operating in Bangladesh. We invested money and got those all by ourselves. We do not see any example of foreign companies operating here transferring any technology to local industry so far.

Incepta is a pioneer in import substitution in medicine. What are the problems you face and what prospects you see?

We have been a pioneer in introducing many different products and will continue to do so. We are now planning to have our own API production and we are planning to introduce many new vaccines and biosimilars. Tremendous research is going on in collaboration with education institutions and research organisations based in Western countries. We are doing research in partnership with them. We are investing in research and development as we planned to continue to introduce new products to the market. There are tremendous challenges for us. Because everything is new. We are to cross the barriers in legislation, in policy matters, in getting approval from the government agencies etc. There are several laws which do not permit us to bring in certain solvents, acids, alkalis etc. But we find the government extremely supportive. Once they are convinced, we get the things done. If we can overcome the remaining problems, we'll continue to add new things which will benefit our industry and the people. Then we will be able to develop a robust export industry, which will help the country achieve its development goals. ###