Bangladesh's pharmaceutical sector has grown fast in the last five years with product diversification, which is reflected in the government's consumption tax collection as well.
Top 20 pharmaceutical companies paid more than double value added tax (VAT) worth Tk3,483 crore to the state coffers in FY22 against Tk1,879 crore in FY18, according to National Board of Revenue (NBR) data.
The VAT collection grew by 11.20% last year from the large pharmaceuticals compared to FY21.
Currently, consumers have to pay a total of 17.4% VAT on pharmaceutical products -- 15% at production stage and 2.4% at sales stage.
Officials said medicine prices remained unchanged during the last five financial years.
The Directorate General of Drug Administration (DGDA) increased prices of 53 essential drugs after seven years in July last.
Before this, the prices were revised in 2015.
Of the top VAT-paying companies, Square Pharmaceuticals is in the first position by paying Tk583 crore last year.
The payment by the company grew by 14.44% last year over the corresponding year, data of large taxpayers unit (LTU) under VAT wing revealed.
Incepta Pharmaceuticals Company Limited is in the second position with Tk467 crore paid in VAT, up by 19.91% year on year.
Renata Limited paid Tk328 crore, standing after Incepta.
VAT payment by the company grew by 7.09% last year.
Healthcare Pharmaceuticals Limited paid Tk335 crore to the public exchequer.
The pharmaceutical company's VAT payment grew by 34.80% in FY22, over the corresponding period last year, highest among all drug-makers.
ACME Laboratories Ltd paid Tk281 crore worth of VAT --up by 11.35% over the corresponding period.
VAT payment by ACI Limited grew by 10.18% last year.
The company paid Tk202 crore.
Aristopharma Limited paid Tk172 crore and Drug International Tk107 crore.
Eskayef Bangladesh Ltd paid 15.92% more VAT worth Tk245 crore to the public exchequer last year.
Currently, there are 200 registered pharmaceutical companies in Bangladesh, according to Bangladesh Association of Pharmaceutical Industries (BAPI).
Market size was Tk173 crore in 1981 that jumped to Tk1,699 crore in 2000, according to IQVIA, formerly known as MIS health.
However, the pharmaceutical industry registered a quantum leap from 2010 to 2021.
In 2010, market size was Tk6,800 crore that shot up to Tk23,184 crore in 2019, and Tk26,285 crore in 2020.
In 2021, the pharmaceutical sector faced negative growth due to the Covid pandemic, causing a nominal slide of market size to Tk26,163 crore.