CPTPP signals pharma breakthrough

Amid enforcement of landmark free trade agreements, Vietnam’s Ministry of Health has made significant legislative changes.
cptpp signals pharma breakthrough

Vu Thi Thu Hien and Le Huu Hong Chuyen of Tilleke & Gibbins, Southeast Asia’s leading full service regional law firm

Vu Thi Thu Hien and Le Huu Hong Chuyen of Tilleke & Gibbins, Southeast Asia’s leading full service regional law firm, give an inside view into how these agreements and legislative changes can make an impact on the local pharmaceutical market in the future.

The market for ­pharmaceuticals in Vietnam is developing rapidly, in step with the country’s growing and aging population, rising per capita income, and increasing awareness of foreign ­brand-name drugs, which many ­Vietnamese consumers consider to be more reliable than generics and local brands. ­Naturally, Vietnam has ­become an attractive ­investment ­destination for ­foreign pharmaceutical companies eager to ­target new ­customers.

The government is doing its part to encourage this investment, as seen by its participation in international free trade agreements and ongoing legislative reform. A revised Law on Pharmacy was issued in 2016 followed by subsequent guiding legislation, but obstacles to overseas investment remain. One thing is certain: the business environment in the pharmaceutical sector is constantly changing.

The Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), a multilateral trade agreement signed by 11 countries on both sides of the Pacific, officially came into force in Vietnam in January. Among its provisions, the CPTPP requires each of its members to have a system of pharmaceutical patent linkage. Prior to granting marketing approval to any generic drug, Vietnam must notify the original drug’s patent holder of the generic drug’s application for approval.

By virtue of such notice, the patent holder would then have adequate time and ­opportunity to seek judicial or administrative proceedings and expeditious remedies, such as preliminary injunctions, for the timely resolution of disputes concerning the validity or ­infringement of an applicable patent.

Instead of the above-mentioned system, Vietnam may ­alternatively adopt a non-judicial regime to preclude the ­issuance of marketing approval to generic drugs based on the available patent-related information. This may come from co-operation between Vietnam’s intellectual property office and the Drug Administration of Vietnam, the marketing applicant, or the ­concerned patent holder.

Within the framework of the CPTPP, Vietnam also reached agreements on marketing approval with some other members such as Japan, New Zealand, and Canada. By means of such agreements, Vietnam has the right to establish conditions, limitations, or exceptions when implementing the obligations set forth under Article 18.53 of the deal.

Changes in the legislative ­framework

The government’s Decree No.54/2017/ND-CP of May 2017, the primary legislation guiding the implementation of the Law on Pharmacy, took effect in July 2017. Subsequently, last year two noteworthy guidance documents were issued for the pharmaceutical sector.

The first was Circular No.07/2018/TT-BYT of the Ministry of Health (MoH), effective from June 2018, on guidelines for some articles on pharmacy business of the Law on Pharmacy and Decree 54. The other was the government’s Decree No.155/2018/ND-CP of the government, effective in November 2018, amending some regulations related to investment and business conditions under the management of the MoH.

Circular 07 confirms that only drug business establishments are allowed to hire ­medical representatives, also known as drug introducers, to introduce drugs to healthcare professionals. After Decree 54 took effect, a representative ­office cannot hire new medical representatives, as the definition of drug business establishments excludes representative offices.

However, Circular 07 ­allows the representative ­offices to continue employing medical representatives who have valid drug introduction cards until the cards expire. ­Accordingly, several foreign pharmaceutical companies who are operating through representative offices in Vietnam are ­restructuring their operations to comply with the new regulations. Only drug business establishments can issue drug introduction cards to their ­medical representatives. The local department of health is no longer the entity that will issue these cards to the medical representatives.

Though Decree 155 does not create any substantial changes to the rights and ­obligations of a drug business establishment, including drug importers, it creates less regulated, more pro-business conditions by shortening the time or lessening documents required for the issuance of the Certificate of Eligibility for Pharmaceutical Business (CEPB).

For example, technical documents and human ­resources according to the principles of Good Distribution Practice for drugs and drug raw materials are not required in the application dossier, as the requested scope for CEPB does not cover the right to sell drugs and drug raw materials to retailers or medical service establishments.

Furthermore, the statutory timeline for the authority to issue the CEPB is 20 days, instead of 30 days under Decree 54, from the date recorded in the application receipt in cases where physical and technical facilities and human resources have been verified and assessed as conforming to the respective good practice of the business operating area, and onsite assessment at the applicant establishment facility is not required.

Import licences for drugs

Decree 155 makes the import licence procedure clearer and simpler. For example, to obtain an import licence for a new drug without a marketing authorisation in Vietnam, Decree 155 no longer requires such drug to have full clinical documents on efficacy and safety as mentioned in Decree 54. This change may give foreign manufacturers quicker access to the Vietnamese market.

Additionally, if such new drugs were previously granted an import licence, there is no need to submit clinical ­documents when requesting a new import licence, unless the drug has undergone major changes. Regarding the quantity of the drug to be imported, Decree 155 uses the business needs of the local importer as a basis, rather than the progress and scope of the targeted ­disease as in Decree 54.

Decree 155 abrogates ­previously strict conditions on drugs for special treatment and allows such drugs to be ­imported more liberally based on the country’s needs. Also, for import licence dossiers in all scenarios, Decree 155 relieves the burdens on trading entities by reducing the documentary requirements.

The import registration dossier must include the drug’s label and package insert which are used in the manufacturing or exporting countries, instead of in the certificate of pharmaceutical product (CPP)-granting country as required in Decree 54. Furthermore, it is required to submit a legalised original label and package insert for parallel import licences only; for other import licences, a copy of the label and package insert can be submitted, provided they are stamped by the manufacturer, the product owner, the ­marketing authorisation holder named on the CPP, or the local importer.

Decree 155 abrogates regulations on amendment and ­­re-issuance of Certification of Drug Information and Certification of Drug Advertisement Contents. The administrative procedures for amending and re-issuing these certifications no longer exist.

The procedure for new ­issuance of such certifications under Decree 54 is unchanged. However, Decree 155 removes the requirement to submit the marketing authorisation or import licence in the applications for the certifications. Furthermore, the CEPB issued by the Ministry of Health is no longer required in the application if the applicant is the pharmaceutical business establishment who owns such CEPB.

Slowly but surely, the Vietnamese pharmaceutical sector appears to be falling in line with international standards and practices. The reduced bureaucratic requirements and improved intellectual property protection are certainly positive signs and may encourage further market entry. However, international pharmaceutical companies looking to do business in Vietnam may still encounter regulations and restrictions that do not exist in other jurisdictions, and would be well advised to seek professional assistance from a legal perspective to ensure strict compliance with the law.

Source: Vir

Related News

Taking advantage of FTAs ​​to promote exports of many products to Japan

Taking advantage of FTAs ​​to promote exports of many products to Japan

VCN - Vietnam and Japan are participating in 4 bilateral and multilateral free trade agreements, Vietnamese enterprises need to take advantage of this to increase exports.
Mexico: The leading market in the CPTPP bloc importing Vietnamese Tra fish

Mexico: The leading market in the CPTPP bloc importing Vietnamese Tra fish

VCN - According to statistics from General Department of Vietnam Customs, in the first half of July 2024, pangasius exports to Mexico reached more than US$4 million, an increase of 90% compared to the same period in 2023.
Vietnam

Vietnam's exports to Canada lead among CPTPP countries

VCN - Ms. Tran Thu Quynh, Commercial Counselor, Vietnam Trade Office in Canada shared with Customs Magazine about the picture of Vietnamese goods in Canada with a lot of potential that can be further exploited, and recommendations for businesses, along with activities deployed by the Trade Department to support businesses to conquer this attractive "billion dollar" market.
Seafood businesses effectively exploit tariff incentives from CPTPP

Seafood businesses effectively exploit tariff incentives from CPTPP

VCN - Five years after the Comprehensive and Progressive Agreement for Trans- Pacific Partnership (CPTPP) came into effect, Seafood industry belongs to those enjoying many positive changes thanks to taking advantage of preferential tariffs in trade with member countries.

Latest News

Mekong Delta promotes clean agricultural production to achieve Net Zero

Mekong Delta promotes clean agricultural production to achieve Net Zero

Localities in the Mekong Delta region have been progressively developing roadmaps for clean agricultural production as an effort to gradually guide Vietnam's agricultural sector towards the goal of "Net Zero" by 2050.
Wood export target of 15.2 billion USD feasible, challenges remain

Wood export target of 15.2 billion USD feasible, challenges remain

Despite market recovery, the wood industry needs to overcome formidable challenges to realise the export revenue target of 15.2 billion USD for the whole year, according to insiders.
Serious shortage and many impacts on seaport human resources

Serious shortage and many impacts on seaport human resources

VCN - According to the assessment of seaport enterprises in Vietnam, from 2024-2028, human resources at seaports will have strong changes in demand, due to the impact of technological trends to meet the task of developing the seaport economy in Vietnam.
Exports gain momentum

Exports gain momentum

VCN - With a highly open economy like Vietnam, exports are an important driving force for economic growth. In many major markets, the recovery in year-end consumption of goods creates more room for industries to contribute to export turnover.

More News

The driving force for businesses to "sprint" at the end of the year

The driving force for businesses to "sprint" at the end of the year

VCN - Although the economy has shown many signs of recovery and business results are positive, the difficult period has not yet passed, forcing businesses to continue to make efforts to "sprint" in the last months of 2024.
Binh Duong: Export enterprises regain growth momentum

Binh Duong: Export enterprises regain growth momentum

VCN - Import-export activities in Binh Duong are on the path of recovery and growth. Notably, key export products have recorded positive signals with abundant orders.
Vietnam

Vietnam's furniture products introduced at UK fair

Furniture products of 15 Vietnamese businesses are introduced at the Source Garden Fair in Birmingham, UK, from September 10-12.
Foreign trade expected to set new record this year

Foreign trade expected to set new record this year

A sharp rise has been recorded in foreign trade over the past few months, and if this upward trend is sustained, this year’s foreign trade turnover is likely to break the record of 732 billion USD set in 2022.
Bewaring of international trade fraud

Bewaring of international trade fraud

VCN - If export enterprises are careless, they will be at risk of being negligent when approaching and drafting contracts and falling into the trap of trade fraud.
Việt Nam promotes green logistics

Việt Nam promotes green logistics

The country's logistics industry has recorded a growth rate of 13-15 per cent each year, making it an important service industry and boosting the nation's socio-economic development.
US association appreciates Việt Nam

US association appreciates Việt Nam's semiconductor industry

Việt Nam has emerged as a new export market, especially in the field of information technology products while many countries are currently applying trade barriers to these products.
Nearly 110,800 new firms established in eight months

Nearly 110,800 new firms established in eight months

Nearly 110,800 new enterprises with total registered capital of nearly 994.7 trillion VND (40.3 billion USD) were established in the first eight months of 2024, a year-on-year increases of 4.4% in the number of businesses and 0.7% in the capital, according to the General Statistics Office (GSO).
Mobilizing finance for low-emission rice value chains

Mobilizing finance for low-emission rice value chains

VCN - Capital is still the biggest difficulty for cooperatives and rice production enterprises, especially those participating in the high-quality, low-emission rice project in the Mekong Delta. This requires strong participation from banks, investment funds and international financial institutions.
Read More

Your care

Latest Most read
Mekong Delta promotes clean agricultural production to achieve Net Zero

Mekong Delta promotes clean agricultural production to achieve Net Zero

Localities in the Mekong Delta region have been progressively developing roadmaps for clean agricultural production as an effort to gradually guide Vietnam's agricultural sector towards the goal of "Net Zero" by 2050.
Wood export target of 15.2 billion USD feasible, challenges remain

Wood export target of 15.2 billion USD feasible, challenges remain

Despite market recovery, the wood industry needs to overcome formidable challenges to realise the export revenue target of 15.2 billion USD for the whole year, according to insiders.
Serious shortage and many impacts on seaport human resources

Serious shortage and many impacts on seaport human resources

According to the assessment of seaport enterprises in Vietnam, from 2024-2028, human resources at seaports will have strong changes in demand
Exports gain momentum

Exports gain momentum

VCN - Although the global economy in 2024 is assessed to still face many risks and unpredictability, Vietnam's key export industries such as textiles, footwear, wood and products, electronics, etc.
The driving force for businesses to "sprint" at the end of the year

The driving force for businesses to "sprint" at the end of the year

VCN - According to the Ministry of Planning and Investment, in the first 7 months of the year, the industrial production index of the whole industry is estimated to increase by 8.5% over the same period last year, only lower than the 8.6% of 2022 in the 2
Mobile Version