Bitter Pills:Medicines & The Third World Poor | Page 44

subsidiary of Wellcome which produces the drug confirm that "Dapsone is not
commercially an attractive proposition for us to manufacture". (5I) But they
point out that Wellcome has been producing 12-14 tons of dapsone a year, when
it was officially only licensed to produce 10.8 tons. By contrast, they say that the
only other dapsone producer in India, a public sector company, has been unable
to produce more than 5-6 tons, despite their licensed capacity of 15 tons. In 1978
Wellcome attempted to get permission to more than double their dapsone
production capacity but this was not forthcoming for two-and-a-half years. (52)
The complex situation of drug production in India, added to what one analyst
has described as its "labyrinthine regulatory statutes", (53) illustrate the obvious
fact that it would be simplistic to ascribe all blame to manufacturers for shortages
of essential drugs. Nonetheless, subsidiaries of European and US manufacturers
are aggravating the problems for developing countries by producing marginally
useful drugs - and in some cases even drugs that they would not be authorised
to sell on the home market. We can best illustrate the problems by taking a closer
look at drug production in Bangladesh which, in contrast to India, is more typical
of the situation in developing countries as a whole.

BANGLADESH: A CASE STUDY
In 1982 there are 166 licensed drug producers in Bangladesh. But the local market
is dominated by just eight foreign-controlled manufacturers - mostly subsidiaries
of European and US transnationals - which account for three- quarters of local
production. (54) Besides taking the lion's share of sales turnover on the private
market, these companies have been near monopoly suppliers of drugs for the public
health services, controlling about 80% of total government purchases. (55)
According to Drug Administration officials, by comparison with other sectors
of manufacturing industry the drug producers are to be congratulated for the
dramatic rise in production they have achieved. In the decade after independence,
production capacity has more than trebled.<56) The drug market has also been
growing rapidly - by about 20% a year at the end of the 1970s/early 1980s. Total
sales turnover will have more than doubled in just four years from 1978
to 1982. (57)
Over 80% of drugs on the market are now locally produced. But all this means
is that they are formulated and packaged in Bangladesh. No more than a handful
of bulk drugs are actually produced there. The majority have to be imported and
paid for in foreign exchange, and they are costing the country about Taka 600
million a year - a sum equivalent to 1.7 times the 1979/80 health budget.(58) This
drain on foreign exchange, but above all the fact that about three-quarters of the
population still has no regular access to vital drugs, makes it crucial that local
production cater for priority needs. (59)
Faced with the needs of the poor, the reality of drug production in recent years
jars. Market estimates for 1978 produced by the local branch of one foreign
company reveal the skewed pattern of production: vitamins, iron tonics, cough
and cold preparations, 'tonics and restoratives', 'volume restorers', enzymes and
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