Vietnam is one of the most promising pharmaceutical markets in Asia. Currently worth almost US $3 billion, the Vietnamese healthcare market is estimated to see increases of as much as 17% per year in the near future. Rising drug consumption and government investment contribute to the country’s attractive OTC and Pharma market.
In 2012, there were approximately 170 pharmaceutical companies and countless OTC, Medical Device and food supplement companies in Vietnam. Nearly 10% of these were owned by foreign investors, with an additional 4% operating under joint venture agreements. Local pharmaceutical production was estimated at nearly US $920 million and was able to meet 48% of the nation’s medical needs. Imported drugs accounted for the remaining 52%.
In terms of market share, the largest drug companies include GlaxoSmithKline, Bristol-Myers Squibb and Novartis. Leading Vietnamese companies include Savipharm and Imexpharm. The biggest Healthcare expenditure in Vietnam is in the out-of-pocket segment, with national health insurance only covering a small section of the population and private expenditure accounting for around 70% of spending. In terms of pharmacy chains, there is one ‘local giant’, Pharmacity Jsc, which accounts for almost half of the share, the rest belonging to small, privately owned drugstores. Statistics show that in terms of local manufacturing, there is an absence of necessary GMP facilities. Many products must be imported from abroad in order to supplement the market’s needs. The demand for essential imported medical drugs is much smaller, creating a big market space for foreign OTC and Rx companies to successfully market their products in Vietnam.
The Drug Administration of Vietnam is the country’s pharmaceutical product regulator, and the Department of Medical Equipment and Health Works is its Medical Device regulator. All pharmaceuticals in Vietnam require both product approval and a separate import permit from the DAV. Only selected Medical Devices require approval for marketing. The future outlook of Vietnam’s pharmaceutical industry is quite optimistic, as companies in the country are investing huge amounts of money in Healthcare. As the country’s population continues to grow, development of the hospital and healthcare system has become a necessity.
As a fast-growing economy in Asia, Vietnam presents a tremendous opportunity for foreign healthcare firms to establish themselves in a promising Emerging Market.