AN ANALYSIS OF THE USE OF IT BY

THE PHARMACEUTICAL

INDUSTRY IN BANGLADESH

Prepared By

Md. Mahabubur Rahaman Student ID: 10364038

Marshal Richard Student ID: 10364057

Rackib Jaman Student ID: 10364069

Tushan Barai Student ID: 10364077

Mashook Mujib ChowdhuryStudent ID: 10364004

Introduction Bangladesh has a large pharmaceuticals market with over

2400 hundred crore taka business of more than 175 pharmaceuticals companies

The top 10% company holds more than 90% of the market share. Our report follows the top four companies.

This report will compare the issues regarding the use of information technology (IT) between the following pharmaceuticals companies.

BEXIMCO Pharmaceuticals Limited (BPL) ACME Laboratories Limited (ALL) Square Pharmaceuticals Limited (SPL) Renata Pharmaceuticals Limited (RPL)

Introduction

The report will look at: How is the company currently using IT? What benefits are they having using IT? What drawbacks are they currently facing

with the use of IT? How can they improve the use of IT? Perform SWOT Analysis

Renata Pharmaceuticals Ltd. Year of Establishment: 1972

Authorized Capital (Taka): Tk. 500 Million

Paid-up Capital (Taka): Tk. 180 Million

Net profit after tax: Tk. 851.428 Million

International Presence: Afghanistan, Cambodia, Guyana, Jordan, Kenya, Malaysia, Myanmar, Nepal,

Philippines, Hong Kong, Sri Lanka, Vietnam, and United Kingdom

Investment: 100% Shareholding in Renata Agro Industries Limited

100% Shareholding in Purnava Limited

More then 300 product, like; ANTIMICROBIALS, ANTI-HYPERTENSIVE, ANTI-DIABETIC , HAIR REGROWTH, EYE-EAR AND TOPICAL PREPARATIONS, ANTI-TUBERCULOSIS AGENTS etc.

IS Scenario Managers use IT as one of the many tools to cope with

change Uses computer hardware, software, storage, and

communication technology for its IT work Uses both manual and computerized information systems Computerized system includes

barcode scanning handheld devices an intranet connection the Internet many pieces of software for tracking packages, fee calculation, and

customer account maintenance as well as managing logistics Its main focus is in supply chain management.

IS Scenario Two main goals of the supply chain management are

to take full advantage of both the efficiency and effectiveness of the entire supply chain for everyone’s advantage

to maximize the opportunity for the customer purchase by ensuring sufficient stock levels at all stages of the process

SAP ERP system have helped Renata manage its total supply chain

Such systems include modules to help manage the entire supply chain and interact with suppliers

Systems are continuously updated to support direct data interaction with both suppliers and customers, e.g. to support electronic data interchange (EDI)

Platform: Windows Applications software: ERP – SAP

SWOT Analysis

Strengths

The system is faster, more responsive, and flexible in ordering, manufacturing, as well as distributing.

The need for warehouses near the serving market has diminished.

SWOT Analysis

Weakness

The use of ERP is only properly used in case of supply chain management. The other departments do not use ERP.

Employees are apprehensive of IT. Employees’ skills are less than what is

required.

SWOT Analysis

Opportunities

Integrating ERP systems throughout the entire organization will allow them to be competitive in the market.

Regular training sessions can be provided to improve employees’ confidence and becoming familiar with IT.

SWOT Analysis

Threats

Only the supply chain management will be competitive with the others but not the entire of the organizational activities.

The issue of globalization will cause problems since countries from developed nations will be having competitive advantage.

BEXIMCO Pharmaceuticals Ltd.

Year of Establishment: 1976 Authorized Capital (Taka): Tk. 9,100 million

Paid-up Capital (Taka): Tk. 2098.07 million Net profit after tax: Tk.1,051.65 million

Number of Shareholders: Tk. 93,371

Beximco Pharma is the flagship company of Beximco Group, the largest private sector industrial conglomerate in Bangladesh.

Only Bangladeshi company with an AIM listing on the London Stock Exchange.

Its state-of-the-art manufacturing facilities have been certified by the global regulatory bodies such as TGA (Australia), GCC (Gulf Council), ANVISA (Brazil) and INVIMA (Colombia).

The only pharmaceutical company in Bangladesh to enter the US market through the acquisition of an Abbreviated New Drug Application (ANDA) for a product.

BEXIMCO Pharmaceuticals Ltd.

The company has a visible and growing presence in emerging markets, including Malaysia, Kenya, Singapore, Myanmar, Sri Lanka, Nepal, Nigeria and the Philippines.

It has received the National Export Trophy (Gold) on three separate occasions for its outstanding contributions to the country’s pharmaceuticals export.

Achieved 33.33% sales growth over 2009, outperforming industry growth of 23.81%.

The company is consistently producing more than 400 products in different dosage forms covering broader therapeutic categories which include antibiotics, antihypertensives, antidiabetics, antireretrovirals, anti asthma inhalers etc,

IS Scenario Supporting hardware, developing and maintaining software, and

all types of system support at the head office, factory, and the distribution centers

Work of the MIS Department: Taking care of total automation Hardware and software network support for the company and factory Providing services through SNA Server, WIN NT Server, and SQL

Server The operational headquarter is linked to the corporate

headquarters through fiber optic cable Also developing the access control & attendance monitoring

system internally Maintains the radio-link between the factory and the head office

and all distribution centers through dial-up Internet

IS Scenario The In-house Software Development & Maintenance of the MIS

department deals with software design and development (such as their entire database) monitoring the task of software (a post implementation task) updating the databases and software if necessary.

This department identifies each department’s requirement and develops the application on continuous basis

Applications are in separate modules, but the company is going to integrate them and convert into an ERP

Uses: for sales analysis, credit collection monitoring, etc. Platform

Windows DOS (disk operating system)

Programming language: Visual Basic and FoxPro Applications software: DBMS – MS SQL Server and FoxPro

SWOT Analysis

Strength

Technology is present virtually everywhere in the organization.

Since the developers are within the organization, maintenance costs are very low.

Developing own software means that the programs can be customized according to own needs.

SWOT Analysis

Weakness Databases based on the prototyping method There is no formal Software Requisition System present

in BPL. Different departments are informally using different

software. Projects are incomplete and there is no intention for

completion

SWOT Analysis

Opportunity

Using commercial, well-tested, and up-to-date ERP systems so that they can compete in the same level as other companies who are using modern systems.

Usage of ERP systems also provide a “centralized” concept which can help in communication, sharing of information, etc.

Provide training sessions to its employees to get fully accustomed to the use of technology and also have the will to do so.

SWOT Analysis

Threats

Local competitors who have been using ERP will have severely competitive against them.

International companies looking to do businesses in the country will already be likely to have great advantage at least in terms of technology.

Square Pharmaceuticals Ltd. Year of Establishment: 1958

Authorized Capital (Taka): Tk. 5,000 Million

Paid-up Capital (Taka): Tk. 1207.22 Million

Net profit after tax: Tk. 2,532.055 Million

Number of Shareholders: Tk. 19,617,390

Largest pharmaceutical company in Bangladesh and it has been continuously in the 1st position among all national and multinational companies since 1985.

Square Pharmaceuticals Limited develops, manufactures, and markets drugs for the health care of various living species primarily in Bangladesh.

Square Pharmaceuticals Ltd. The company also provides local anesthetics, other anti-

bacteria’s, other beta-lactic antibiotics, penicillin’s and cephalosporin’s, NSAIDs and antigun preparations, quinolone antibiotics, respiratory tract preparations, systemic antifungal, antiviral and anti-protozoan agents, systemic hormone, systemic sex hormone, thyroid therapy, topical preparations, vitamins and minerals, and water purification products.

Exports its products to Europe, Asia, Africa, and South America.

Square enlisted as UNICEPs global supplier.

IS Scenario Initially used computers for supporting, developing and

maintaining their own software, and all types of system support within the departments

Only recently they started using SAP for its production related activities

IT department takes care of automation of the company, supporting hardware and software

Hardware: Repair & maintenance Software: Developing, maintaining, and monitoring the

function of software and updating databases and software if required

Support: Installation, system support, presentation support, troubleshooting

IS Scenario

In a similar manner to BPL, SPL offers services through WIN NT Server and SQL Server.

Analysis their department, we find that the company is using the following platforms, programming languages, and applications software.

Platform: Windows Programming language: Visual Basic Applications software: DBMS – MS SQL

Server, ERP – SAP

SWOT Analysis

Strength

The company will be getting used to SAP Usage of SAP enables them to be competitive

with others using the same technology. It also gives them competitive advantage

against those who do not use the modern technology.

SWOT Analysis

Weakness Only one department uses ERP; the others will not be

efficient. Lack of use of sophisticated software (simple XLS

sheets to maintain data for quite complex operations like monthly and yearly data for their work, departmental budget monitoring, purchase records etc.)

Most of the programs are stand-alone (they are isolated and are being used only by a specific department)

Fear or nervousness is present among employees regarding the use of technology

SWOT Analysis

Opportunities

Since a department will be already familiar with SAP ERP, integration to other departments will be relatively easier. Total integration will mean that they will be in a greater competitive advantage than others.

Constant training sessions will enable the company’s employees to get over their fear/nervousness of IT.

SWOT Analysis

Threats

Only the production department will be competitive with the others but not the entire organizational activities.

The issue of globalization will cause problems since countries from developed nations will be having competitive advantage.

ACME Laboratories Ltd.

Year of Establishment: 1954

Since it is not a listed company, the financial details were not possible to obtain

Second largest manufacturer and exporter of Human, Herbal and Animal Health Pharmaceutical Products in Bangladesh.

ACME is exporting medicines to several countries in  neighboring South-East Asia, Africa, Middle East and the EU, maintaining a philosophy to ensure 'Health, Vigour and Happiness' for the whole mankind within its means and resources.

ACME Laboratories Ltd.

Sales wise Afghanistan is the top among the 11 countries ACME is exporting to with a growth rate of 55%.

MOU signed for mutual business interest with the

Himalaya Drug Company of India.

IS Scenario The company provided us with a document named “IT

Security Policy” This lists the rules and regulations for an “IT User” It lists a wide range of security features including frequent

changing of passwords, usage of removable devices, use of email, etc.

This shows us that they seemingly have a well-organized system of the use of IT

Current use of IT includes automated buying process first accounts Inventory sales

IS Scenario

All their departments are interconnected using a virtual private network (VPN)

Such networks have advantage of increased security, as outsiders will not be able to breach in due to built-in firewalls

ISP: Link-3 (provides broadband connection) Uses an ERP systemPlatform: Windows Programming language: Developer 2000 and

Content-2 Applications software: DBMS – Oracle Database

(XP) and Office suits

SWOT Analysis

Strengths

All transactions through computers Lack of errors Better control Maintaining discipline Reduction of documents Fixing double entry problem, and so on.

SWOT Analysis

Weakness

All information are not online since the current day’s data will be updated the next day (a sudden loss in between will cause data to be lost.

Workforce skill is not up to what is required. Training sessions need to be conducted.

The infrastructure of the departments suffers due to low bandwidth of the network.

SWOT Analysis

Opportunities

Improving the VPN system to increase bandwidth.

Applications may be improved so that they are compatible with any browser.

Constant training sessions will enable the company’s employees to get over their fear/nervousness of IT.

SWOT Analysis

Threats There is no e-commerce facility currently.

Hence any company using such service will be at an advantage.

Companies from developed countries seeking to do business in Bangladesh will create problems when ALL tries to compete with them.

Conclusion We have found that the use of IT does not affect the

companies’ profit margins, value chain, inventory management, and various types of marketing procedures

The reason for this may be because of the late use of modern technology thereby it is not possible to properly evaluate the impact of IT

From our course, Information Management, we learn that IS is helping in various ways to help companies leverage their profit.

Even the top companies of the world are getting benefitted by using IT.

Bangladeshi companies are lagging way behind

Conclusion Most important reason is lack of using IS technology; proper

planning, monitoring, budgeting, lack of knowledge, etc. are missing.

Our top ten pharmaceutical companies are now competing globally exporting their products to more than 30 countries around the word

For competing with foreign pharmaceutical companies, our companies need to develop their ICT

So far the way they use ICT is not sufficient. Although these companies have made good profit margins, they would make even greater levels with proper use of IT

Good news is that they are realizing it and are trying to adopt modern technology

It can be expected that after two years or more, we will see a good result being produced.

Recommendation

Main problems: employees’ fear or uneasiness with technology, the current technology not being fully up-to-date when compared with international companies, and also the choice of a proper technology, namely ERP

1. Fear of technology Regular training sessions are required Such sessions will educate the people so that they

understand that IT is nothing to be apprehensive about; it rather creates an advantage

Recommendation

2. Up-to-date technology Once people are used to IT, upgrading or updating

to newer and better systems become relatively easier

New trainings will be required

3. Use of ERP A well designed ERP helps a business flawlessly

combine key computer applications Purchase of such software from major software

giants like SAP, Oracle, and IBM

Thank You

Any Question ?