Pharmaceutical shipments from Bangladesh are slowly making a turnaround with a gradual improvement in the global US dollar crisis, according to drug exporters.

In the July-February period of fiscal year 2022-23, exports in each month had been lower than what they were during the corresponding months of the previous year.

But over the span of the eight-month period, the difference has been coming down, giving rise to hope that the industry would start achieving year-on-year growth by the end of this calendar year.

In July 2022, exports were down 28.23 per cent year-on-year. But in February this year, exports were down by just 8.82 per cent.

Drugs worth $119.06 million were exported during the July-February period of the current fiscal year, according to data of the Export Promotion Bureau (EPB).

It was $130.57 million during the same period of the previous fiscal year.

Pharmaceuticals exporters say they are trying hard amid a number of obstacles.

Bangladesh mainly exports medicine related to malaria, tuberculosis, cancer, leprosy, kidney dialysis, homeopathy, biochemicals, ayurvedic and hydrocele alongside penicillin, streptomycin and anti-hepatic ones.

"The crisis of the pharma industry in Bangladesh will be overcome," said SM Shafiuzzaman, secretary general of the Bangladesh Association of Pharmaceutical Industries (Bapi), which represents about 250 local drug makers.

The industry has gained the strength to tackle any kind of crisis, except for natural disasters, as Bangladesh produces world-class generic drugs capable of competing with those of any other country, he said.

According to him, pharmaceutical manufacturers have adopted very sophisticated technologies and can offer competitive prices, for which exports would increase in spite of facing some obstacles for the time being.

He acknowledged that the industry was still struggling to recover from the crisis.

Bangladesh exports pharmaceutical products to 151 countries, including those in the EU, Africa and Latin America as well as the US, after catering to 98 per cent of the domestic demand, according to Bapi.

"The markets of the rest of the world are becoming stable in the post-Covid era. It will give us opportunities to expand our operations," said Mohammad Mujahidul Islam, executive director (marketing and sales) of Eskayef Pharmaceuticals.

The biggest milestone of Eskayef's journey in exports came in 2022, when its injectables manufacturing facility received approval of the United States Food and Drug Administration.

"Following the approval, we have already started shipping our injectables and oral solid products to the US. Our strategy is to solidify export sales from SRA [stringent regulatory authority] markets, especially the US market," he added.

Obstacles for the pharmaceutical industry are gradually being lifted, including restrictions on opening letters of credit (LCs) to import raw materials, said Monjurul Alam, director for global business development at Beacon Pharmaceuticals.

"The manufacturers are getting orders from major importers amid the global economic crisis as their situation is improving," he added.

Alam then said the company might perform well within the first half of 2023 as the number of export destinations could increase.

According to him, the pharmaceuticals sector is still struggling to tackle the situation amid the ongoing US dollar crisis and recent gas and power price hikes.

He thanked the government for giving the pharmaceuticals sector priority in opening LCs to import raw materials.

However, he said the export of Covid-19 drugs came down due to significant improvements in the pandemic, which had an effect on the overall export volume of Bangladesh.

But the industry suffered as the taka lost its value by about 25 per cent against the US dollar since the Russia-Ukraine war began in February last year.

"The profit margin of all drug manufacturers fell due to an increase in the cost of production," said Mohammad Ziauddin, deputy general manager (marketing) of ACME Laboratories.

The devaluation of the taka against the US dollar increased the import cost of raw materials, in some cases by 40 per cent to 45 per cent.

However, he said the companies adopted short and long-term strategies to recover from the crisis, helping them improve the situation regarding exports.

Ziauddin believes that by the end of the current month, the industry would be able to reach year-on-year growth.

"It will take more time to reach year-on-year growth as export orders are being placed very slowly," said Wasim Haider, manager for international marketing at Beximco Pharmaceuticals.

Major importers like Sri Lanka, Myanmar and Nepal are yet to start importing products due to the US dollar crisis.

Besides, manufacturers are facing restrictions in opening LCs to import raw materials, Haider added.

He went on to say that the price hike of the US dollar and renminbi of China has increased production costs.

According to him, they have to settle LCs at Tk 110 against each US dollar while the import cost has gone up by around 22 per cent due to the price hike.

As a result, profit margins declined in export as prices of export items did not increase although production costs had increased.

Haider also said pharmaceutical companies suffered a lot due to the Russia-Ukraine war, the coronavirus pandemic and US dollar crisis.