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GlaxoSmithKline mulling over business expansion in Bangladesh

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Ramil Burden, Vice President, Africa and developing countries, GSK

GlaxoSmithKline (GSK), one of the world’s leading drug manufacturers, plans to expand its business in Bangladesh aiming to meet growing demand for pharmaceutical and healthcare products.

Under the plan, the multinational company intends to invest £4.0 million within a year for enhancement and diversification of its products in Bangladesh, said Ramil Burden, Vice President, Africa and developing countries, GSK.

“Rising consumerism and awareness about quality products have been encouraging us to raise our production base in Bangladesh,” he told the FE while he was on a visit to Sunamganj recently.

He said main objectives of his company are to ensure better and wider access to healthcare products for consumers, including those of Bangladesh.

Mr. Burden said GSK which started its operation in Bangladesh (erstwhile East Pakistan) in 1949, is going to invest £4 million in Bangladesh in next 12 months of which £1 million will be utilised in Chittagong plant.

GSK Bangladesh Ltd, a subsidiary of GSK, has a 30 per cent market share in respiratory disease-related drugs segment, 3.0 per cent in overall pharmaceutical and 85 per cent in health food drinks market in Bangladesh.

GSK Bangladesh’s net sale was Tk 7.18 billion in last calendar year, achieving 6 per cent sales growth and 20 per cent growth of gross profit over that of 2013, according to its annual report 2014. Its factory is situated in Chittagong.

Mr Burden visited Sunamganj last month to see for himself the Community Health Workers’ (CHK) project which has been undertaken to help enhance women and children healthcare facilities in remote areas of the district.

The project launched in 2012 is part of GSK’s 20 per cent profit reinvestment initiative jointly taken with the government of Bangladesh and Care International.

Under the initiative, GSK reinvests the amount of profits generated from its pharmaceutical and consumer healthcare business to support building of health infrastructure in most underserved areas through innovative partnership between government, private and non-governmental organisations (NGO) sectors.

GSK runs similar programmes in more than 30 countries, mostly in Africa.

Mr Burden said the expanded CHK project will help create a total of 300 private community skilled birth attendants (PCSBA) or midwives and 3,700 community health workers reaching out to 1.5 million people.

When asked about the prospect of GSK products in Bangladesh, he said rising consumerism in Bangladesh is being considered a positive factor by the foreign companies.

Rising purchasing capacity is also adding to the increase in consciousness about health among the population. The companies like GSK view this a positive trend, he said, adding that the country has been able to maintain over a 6 per cent GDP growth for a decade.

And consumer products’ growth in Bangladesh is also much higher compared to other South Asian countries.

Mr Burden said GSK’s health food drink products especially Horlicks, Boost, Maltova, Viva now hold more than 85 per cent market share in Bangladesh.

Multinational companies (MNCs) face tough competition with local ones in pharmaceutical business as domestic companies get various facilities, he observed.

The Bangladesh government should ease criteria for import of pharma products for MNCs to make a level playing field. “And it could also increase investment and employment,” he said.

When asked if multinational pharma companies would get advantage in the post-IPR (Intellectual Property Right) period, when ‘IP waiver’ for LDCs (Least Developed Countries) would be no more, he said: “I don’t think it could bring any change. We are not eyeing to any advantage just focusing on product quality and diversification realising the nerve of consumers.”

He further said Bangladesh is going to be a middle-income country within next few years which could bring a number of opportunities not only for local businesses but also for GSK and other MNCs.

Ramil Burden said demand for quality and high-value products has gradually been increasing in Bangladesh which is a positive development for MNCs in Bangladesh.

“As you see, we don’t make payments to any doctor, we have no medical representatives, just have wholesalers who provide GSK-made quality products and maintaining quality is our promotion and business strategy.”

When asked about new foreign investment, Mr Burden, who also leads GSK’s operations in Bangladesh, Myanmar, Cambodia, Laos and Papua New Guinea, said the government will also have to ensure political stability which is expected for trade growth.

GSK is currently reviewing its long-term strategy for Bangladesh and his company is very positive and reviewing its manufacturing strategy in the country.

Since 1967, the company has been producing drugs in its Chittagong factory and investing over £1 million a year to upgrade facilities.

Mr Burden said his company will continue to invest in innovations in Bangladesh in line with the company policy, which expends about £4 billion in research and development worldwide a year.

“GSK will also invest here so that people’s access increases to these innovations,” he said.

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Report:  Yasir Wardad
Source: Financial Express

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