The country's pharmaceutical industry has achieved remarkable growth over the past four decades. Meeting 98 percent of the domestic demand for medicines worth more than $3 billion and exporting to over 150 countries, including highly regulated markets such as the UK, the US and the EU, it has become a sector of immense strategic importance.

This success has been largely underpinned by a key World Trade Organization (WTO) provision: the TRIPS (Trade-Related Aspects of Intellectual Property Rights) waiver for least developed countries (LDCs). This exemption, due to expire when Bangladesh graduates from LDC status in 2026, has allowed local companies to legally produce and sell patented medicines without authorisation. It has ensured affordable healthcare and encouraged industrial growth. The withdrawal of this waiver will pose a significant challenge, demanding immediate and strategic responses from policymakers and industry stakeholders.

The most immediate consequence will be the loss of the ability to reverse-engineer new patented drugs, restricting the production of generic versions of newly patented medicines. This could increase dependence on imports and drive up treatment costs. In addition, medicines patented after 2005 may face legal constraints, putting part of the existing product portfolio at risk. To stay competitive, particularly in regulated markets, pharmaceutical firms will also need to invest heavily in research and development (R&D) to create novel drugs, biosimilars or complex generics, which require significant capital. Without timely adaptation and investment, the industry risks losing its competitive edge both at home and abroad.

India's post-2005 TRIPS experience offers valuable lessons. India amended its patent law in 2005 with a strategic approach. A key instrument was Section 3(d) of its Patents Act, which prevents "evergreening", the practice of obtaining new patents on minor modifications of existing drugs to extend market exclusivity. This ensured that only genuinely innovative drugs received patents, protecting the generic industry. India also used compulsory licensing to maintain access to essential medicines. At the same time, Indian pharmaceutical companies invested heavily in R&D and advanced manufacturing, transforming themselves from pure generic producers into global players.

To navigate this critical transition, Bangladesh needs a multi-pronged strategy. The first step is policy and legal preparedness. The government must proactively amend the Patent and Designs Act to incorporate TRIPS-compliant flexibilities. This should include provisions for compulsory licensing, allowing the state to authorise the generic production of patented drugs in the public interest. In addition, adopting Bolar-type provisions would permit generic companies to conduct research and seek regulatory approval before a patent expires, ensuring immediate market entry once it does.

A shift in mindset from imitation to innovation is equally vital. The government should encourage a supportive ecosystem through tax incentives for R&D, research grants, and public-private partnerships to establish advanced pharmaceutical research centres.

Bangladeshi companies must also raise their quality standards beyond WHO-GMP to the more stringent EU-GMP and US-FDA benchmarks to compete globally. Government assistance in technology transfer and upgrading production facilities will be essential.

Bangladesh should collaborate with neighbouring countries and regional blocs to share manufacturing capacity, technology and negotiating leverage with multinational firms. Policymakers should also prepare targeted subsidies, reimbursement mechanisms or negotiation strategies for high-cost patented medicines to protect public health budgets.

With foresight, strategic policymaking and a united effort to strengthen innovation capacity, the pharmaceutical industry can turn this looming challenge into an opportunity for sustainable, value-driven growth. Bangladesh can surely safeguard its healthcare achievements and secure a competitive position in the global pharmaceutical landscape.

The writer is chairman and managing director of BASF Bangladesh Limited