VN pharmaceutical market: stiff competition fosters M&A wave

Vietnam ranks 17th among 'pharmerging' markets, or markets expected to become a ‘pillar’ for the world’s pharmaceutical industry, according to IMS Health.
vn pharmaceutical market stiff competition fosters mampa wave
In 2015-2022, ethical drugs (ETC) accounted for an overwhelming proportion compared with OTC (over the counter) drugs. In 2020, for example, while ETC scale has estimated value of US$5.5 billion, the figure is just US$1.8 billion for OTC.

It is expected that in 2020, the scale of the bidding-based drug distribution market may reach US$7 billion. The drug retail channel is valued at US$1.9 billion, which shows slower growth and stiffer competition because of low business barriers.

According to Fitch Solutions, the revenue of the OTC market grew by 9.5% per annum from 2019 to 2020, lower than the growth rate of 11.7% of the ETC market.

Imexpharm is a typical example of successfully entering the ETC market, which has been the playing field of foreign products and foreign companies.

Imexpharm’s products now are sold easily through bidding and at European standards and reasonable prices.

Imexpharm is one of a small number of enterprises operating factories meeting EU-GMP standards. These include Imexpharm Dong Thap (WHO-GMP standard, IMP1), Vinh Loc high-tech antibiotic factory (EU-GMP, IMP2), Betalactam High-technology Binh Duong (EU-GMP; IMP3) and Non-Betalactam Hi-tech Binh Duong (EU-GMP, IMP4).

There are 214 establishments that make drugs meeting WHO-GMP standards or higher. However, Imexpharm and Pymerpharco are the only listed ETC drug makers.

Meanwhile, Vimedimex is going the opposite way: it is shifting focus from ETC to OTC markets to avoid changes in policies. Under current regulations, hospitals prioritize to buy products from the suppliers which offer the lowest prices.

According to IMS Health, the value of the Vietnamese drug would exceed US$7 billion by 2020. However, 55% of the drugs are from imports. The General Department of Customs reported that Vietnam spent US$2.82 billion to import drugs in 2017.

The high attractiveness of the market explains why foreign investors are eyeing Vietnamese pharmacy firms. Japanese Taisho bought into Hau Giang Pharmacy, Nipro Pharma into Mekophar, Stada into Pymepharco and Abbot into Domesco.

In late May, SK Investment Vina III, belonging to SK Group, acquired 12.3 million Imexpharm shares, or 24.9% of the company’s shares. Analysts estimated that the deal had value of VND660 billion.

A series of M&A deals are expected to be made in the last months of 2020. KT Kimia Farma from Indonesia is considering buying a retail drug store chain in Vietnam.

“We believe that there will be some M&A deals in the next few years when the government plans to reduce its ownership ratios in Vietnamese pharmacy firms,” said Pham Huyen Trang from the Saigon Securities Incorporated.

Source: VietnamNet
english.vov.vn

Related News

Promoting Vietnam-Laos Customs cooperation

Promoting Vietnam-Laos Customs cooperation

VCN - On November 19, 2024, in Hanoi, Vietnam Customs held the Vietnam - Laos Customs Directors General Conference.
Vietnam’s exports to the U.S. near US$100 billion milestone

Vietnam’s exports to the U.S. near US$100 billion milestone

VCN - By the end of October, Vietnam's exports to the United States approached US$100 billion, reaffirming its position as Vietnam's largest export market.
U.S. Treasury continues to affirm Vietnam does not manipulate currency

U.S. Treasury continues to affirm Vietnam does not manipulate currency

VCN - In its latest report, the U.S. Department of the Treasury has positively assessed Vietnam's monetary policy, reaffirming that Vietnam does not engage in currency manipulation.
Vietnamese passion fruit gets “great opportunities” to Australia

Vietnamese passion fruit gets “great opportunities” to Australia

VCN - Vietnamese passion fruit having been exported to twenty countries, in many forms such as fresh fruit, frozen fruit, juice, recently Vietnamese passion fruit continues to be licensed to export to the Australian market. Thus, after mango, longan, lychee, dragon fruit, passion fruit is the 5th product of Vietnam licensed to export to the Australian market.

Latest News

Monetary policy forecast unlikely to loosen further

Monetary policy forecast unlikely to loosen further

It will be difficult for the State Bank of Vietnam (SBV) to further loosen monetary policy due to a rising USD/VNĐ exchange rate pressure, experts said.
World Bank outlines path for Vietnam to reach high income status

World Bank outlines path for Vietnam to reach high income status

The World Bank (WB) has released a report which explores how Vietnam can upgrade its participation in global value chains to become a high-income country by 2045.
Strictly control public debt and ensure national financial security  2025

Strictly control public debt and ensure national financial security 2025

VCN – In order to achieve goal of strictly managing public debt and maintaining security and safety of the national financial system in 2025, it is necessary to ensure the borrowings and repayments of public debts is within the approved estimate; closely monitor public debt indicators to ensure that they are within the ceiling and warning thresholds approved by the National Assembly.
Revising the title of a draft of 1 Law amending seven finance-related laws

Revising the title of a draft of 1 Law amending seven finance-related laws

VCN - On November 19, 2024, the Standing Committee of the National Assembly (SCNA) discussed amendments and refinements to the draft of a law revising seven existing finance-related laws. Concluding the session, Vice Chairman of the National Assembly Nguyen Duc Hai emphasized the need for the Government to direct the drafting body and relevant agencies to collaborate closely to finalize a persuasive and widely supported report, ensuring the quality of the draft law for the National Assembly's consideration and decision.

More News

Transparency evates the standing of listed companies

Transparency evates the standing of listed companies

VCN - According to the Hanoi Stock Exchange (HNX), the number of companies placed under warning, control, or restricted trading on the listed and registered markets has increased over the past two years compared to 2022.
State-owned securities company trails competitors

State-owned securities company trails competitors

Contrary to the outstanding performances in the banking sector, the securities subsidiaries of major banks have yet to fully leverage their potential, despite numerous inherent advantages.
Strengthening the financial “health” of state-owned enterprises

Strengthening the financial “health” of state-owned enterprises

VCN - The state economy plays a key role in the socio-economic development process, but it is necessary to strengthen the financial health and competitiveness of state-owned enterprises (SOEs).
Exchange rate fluctuations bring huge profits to many banks

Exchange rate fluctuations bring huge profits to many banks

Net profits from the foreign exchange trading segment of many banks have gained positive results thanks to a strong USD/VNĐ exchange rate fluctuations this year.
A “picture” of bank profits in the first nine months of 2024

A “picture” of bank profits in the first nine months of 2024

VCN - Pre-tax profits for banks during the first nine months of 2024 remained positive, exceeding 200 trillion VND, solidifying the sector's position as a market leader.
Many challenges in restructuring public finance

Many challenges in restructuring public finance

VCN - Restructuring public finance is an important step to improve state financial management, ensure resources are allocated reasonably and effectively, contributing to the country's sustainable development. In addition to the achieved results, the process of accelerating public finance restructuring also faces many pressures.
Tax declaration and payment by e-commerce platforms reduces declaration points and compliance costs

Tax declaration and payment by e-commerce platforms reduces declaration points and compliance costs

VCN - E-commerce platforms that declare and pay taxes on behalf of traders not only help to reduce the number of tax declaration points but also reduce the cost of compliance with administrative procedures for the whole society because only one point as the e-commerce trading platform implements tax deduction, payment and declaration on behalf of tens, hundreds of thousands of individuals and business households on the platform.
Disbursement of public investment must be accelerated: Deputy PM

Disbursement of public investment must be accelerated: Deputy PM

Deputy Prime Minister Ho Duc Phoc has called on ministries, agencies, and localities to accelerate the disbursement of public investment from now until the year-end and further tighten investment management.
HCMC: Domestic revenue rises, revenue from import-export activities begins to increase

HCMC: Domestic revenue rises, revenue from import-export activities begins to increase

VCN - The results of State budget revenue in HCMC in the first 10 months of 2024 are estimated to increase by 10% over the same period last year, of which the highlight is that revenue from import-export activities has begun to increase.
Read More

Your care

Latest Most read
Monetary policy forecast unlikely to loosen further

Monetary policy forecast unlikely to loosen further

It will be difficult for the State Bank of Vietnam (SBV) to further loosen monetary policy due to a rising USD/VNĐ exchange rate pressure, experts said.
World Bank outlines path for Vietnam to reach high income status

World Bank outlines path for Vietnam to reach high income status

The World Bank (WB) has released a report which explores how Vietnam can upgrade its participation in global value chains to become a high-income country by 2045.
Strictly control public debt and ensure national financial security  2025

Strictly control public debt and ensure national financial security 2025

VCN - According to the plan for borrowing and repaying public debt and foreign debt of the country in 2025, the total borrowing demand of the Government in the year is expected to be at VND 815,238 billion, an increase of 20.6% compared to the Government'
Revising the title of a draft of 1 Law amending seven finance-related laws

Revising the title of a draft of 1 Law amending seven finance-related laws

On November 19, 2024, the Standing Committee of the National Assembly (SCNA) discussed amendments and refinements to the draft of a law revising seven existing finance-related laws.
Transparency evates the standing of listed companies

Transparency evates the standing of listed companies

According to the Hanoi Stock Exchange (HNX), the number of companies placed under warning, control, or restricted trading on the listed and registered markets has increased over the past two years compared to 2022.
Mobile Version