Vietnam Pharmaceuticals & Healthcare Report

Providing expert analysis, independent forecasts and competitive intelligence on the pharmaceuticals and healthcare industry.

Report includes: BMI Industry View, Industry SWOT Analysis, Industry Forecasts, BMI's Pharmaceuticals and Healthcare Risk Reward Index, Market Summary, Economic Forecasts, Company Profiles and Competitive Landscape.

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Vietnam Pharmaceuticals & Healthcare Report
Product Price
$1,295.00

BMI View: Ongoing regulatory reform and the relaxation of the 49% cap on foreign ownership will continue to increase the appeal of Vietnamese pharmaceutical equities to foreign investors. This trend will reflect the government efforts to attract foreign investment in order to de velop the pharmaceutical sector as well as foreign companies aim to gain a competitive edge in the domestic market. However, due to public procurement bias towards local producers, the rise of domestic pharmaceutical companies will also present competitive threats to multinational drugmakers operating in the country, eventually leading to varia tions in their business models.

Headline Expenditure Projections

  • Pharmaceuticals: VND92.5trn (USD4.2bn) in 2015 to VND105.6trn (USD4.7bn) in 2016; +14.2% in local currency terms and +11.7% in US dollar terms. Forecast in line in local currency terms and revised slightly upwards in US dollar terms compared to the last quarter.

  • Healthcare: VND304.5trn (USD13.9bn) in 2015 to VND333.6bn (USD14.9bn) in 2016; +9.6% in local currency terms and +7.2% in US dollar terms. Forecast revised slightly upwards compared to the last quarter.

Headline Pharmaceuticals & Healthcare Forecasts (Vietnam 2014-2020)
2014 2015 2016f 2017f 2018f 2019f 2020f
f = BMI forecast. Source: WHO, National Sources, BMI
Pharmaceutical sales, USDbn 3.810 4.220 4.710 5.230 5.850 6.610 7.440
Pharmaceutical sales, % of GDP 2.05 2.20 2.33 2.37 2.39 2.41 2.41
Pharmaceutical sales, % of health expenditure 29.0 30.4 31.7 32.7 33.5 34.1 34.5
Health spending, USDbn 13.130 13.890 14.890 16.000 17.450 19.390 21.580

Risk Reward Index

In Q416 Vietnam's Pharmaceuticals Risk/Reward Index score remains unchanged at 48.3 out of a maximum of 100. Vietnam remains ranked 13th out of 19 countries monitored in the Asia Pacific region in terms of market attractiveness to pharmaceutical investors. Vietnam scores above the regional average for overall market expenditure and sector value growth; however, the score is dragged down by low spending per capita on medicine and subdued patent respect.

Latest Updates

  • After the official lifting of Domesco's 49% foreign ownership cap, US-based Abbott Laboratories, through its subsidiary CFR International (Chile), registered to increase its ownership in Domesco to 51.7% in September 2016 from 45.49% previously.

  • In addition, Abbott acquired Vietnamese pharmaceutical manufacturer Glomed in August 2016, reflecting Abbott's determination to strengthen its manufacturing capacity in Vietnam.

  • Also in August, French-based Sanofi signed an agreement to extend and strengthen its partnership with Vinapharm. Covering all locally manufactured medicines marketed by Sanofi in Vietnam and products exported to countries in the Asia Pacific, the agreement includes Vinapharm investment in Sanofi's recent and third manufacturing plant in Vietnam (a USD75mn plant which represents Sanofi's largest investment in the market to date).

  • In July 2016, Japan-based Taisho Pharmaceutical bought a 24.5% stake in Vietnam's Hau Giang Pharmaceuticals (DHG Pharmaceutical), the country's top drug distributor, for VND2.2trn (USD97mn).

  • In June 2016, the Vietnamese government launched an initial public offering for an 18% stake in Vietnam Pharmaceutical Corporation (Vinapharm) for approximately VND443bn (USD19mn), which is expected to be the first of several Vietnam-based companies selected to be privatized.

BMI Economic View

Due to a weaker-than-expected GDP growth performance in H116, we have downgraded Vietnam's growth forecast to 5.9%, from 6.3% previously. However, we expect growth to accelerate over the coming quarters spurred by a recovery in agricultural output, as well as robust growth in the industrial and services sectors.

BMI Political View

The PCA's ruling on the Philippine arbitration case on July 12 will have wider implications for other claimant countries in the South China Sea, particularly Vietnam, as the conclusions that were drawn will help to set legal precedent for similar maritime disputes in the region. We believe that Vietnam will likely stand to benefit vis-a-vis China by using the ruling to clinch concessions from Beijing as a counterbalance to nationalist domestic sentiment.

BMI Industry View
7
Table: Headline Pharmaceuticals & Healthcare Forecasts (Vietnam 2014-2020)
7
SWOT
9
Industry Forecast
11
Pharmaceutical Market Forecast
11
Table: Pharmaceutical Sales, Historical Data And Forecasts (Vietnam 2012-2020)
13
Healthcare Market Forecast
14
Table: Healthcare Expenditure Trends, Historical Data And Forecasts (Vietnam 2012-2020)
17
Table: Government Healthcare Expenditure Trends, Historical Data And Forecasts (Vietnam 2012-2020)
18
Table: Private Healthcare Expenditure Trends, Historical Data And Forecasts (Vietnam 2012-2020)
19
Prescription Drug Market Forecast
20
Table: Prescription Drug Market Indicators, Historical Data And Forecasts (Vietnam 2012-2020)
22
Patented Drug Market Forecast
23
Table: Patented Drug Market Indicators, Historical Data And Forecasts (Vietnam 2012-2020)
24
Generic Drug Market Forecast
25
Table: Generic Drug Market Indicators, Historical Data And Forecasts (Vietnam 2012-2020)
26
OTC Medicine Forecast
27
Table: Over-The-Counter (OTC) Medicine Market Indicators, Historical Data And Forecasts (Vietnam 2012-2020)
29
Pharmaceutical Trade Forecast
30
Table: Pharmaceutical Trade Data And Forecasts (Vietnam 2014-2020)
32
Table: Pharmaceutical Trade Data And Forecasts local currency (Vietnam 2014-2020)
32
Pharmaceuticals & Healthcare Risk/Reward Index
33
Asia Pacific Risk/Reward Index - Q3 2016
33
Vietnam Risk/Reward Index
39
Rewards
39
Risks
39
Regulatory Review
41
Intellectual Property Issues
43
Table: Special 301 Submission: Issues Raised For Vietnam
44
Pricing Regime
47
Reimbursement Regime
52
Market Overview
56
Healthcare Sector
57
Table: Healthcare Resources (Vietnam 2010-2015)
60
Table: Healthcare Personnel (Vietnam 2010-2015)
60
Table: Healthcare Activity (Vietnam 2010-2015)
61
Research & Development
66
Competitive Landscape
76
Research-Based Industry
76
Table: Multinational Market Activity
80
Pharmaceutical Distribution
81
Pharmaceutical Retail Sector
81
Table: Key Aspects Of Good Pharmacy Practice In Developing Countries
83
Company Profile
84
DHG Pharmaceutical
84
GlaxoSmithKline
86
Sanofi
88
Traphaco Pharmaceutical
91
Vietnam Pharmaceutical Corporation (Vinapharm)
93
Demographic Forecast
96
Table: Population Headline Indicators (Vietnam 1990-2025)
97
Table: Key Population Ratios (Vietnam 1990-2025)
97
Table: Urban/Rural Population & Life Expectancy (Vietnam 1990-2025)
98
Table: Population By Age Group (Vietnam 1990-2025)
98
Table: Population By Age Group % (Vietnam 1990-2025)
99
Glossary
101
Methodology
103
Pharmaceutical Expenditure Forecast Model
103
Healthcare Expenditure Forecast Model
103
Notes On Methodology
104
Risk/Reward Index Methodology
105
Index Overview
106
Table: Pharmaceutical Risk/Reward Index Indicators
106
Indicator Weightings
107

The Vietnam Pharmaceuticals & Healthcare Report features BMI Research's forecasts for drugs and healthcare expenditure and imports and exports, focusing on the growth outlook for the prescription, OTC, patented drugs and generics market segments.

BMI's Vietnam Pharmaceuticals & Healthcare Report provides industry professionals, strategists, company executives, investors, analysts and sales/marketing heads with independent forecasts and competitive intelligence on the Vietnam pharmaceutical and healthcare industry.

Key Benefits

  • Benchmark BMI's pharmaceutical and healthcare market forecasts for Vietnam, to test other views - a key input for successful budgeting and strategic business planning in the Vietnamese pharmaceutical and healthcare market.
  • Target business opportunities and risks in the Vietnamese pharmaceutical and healthcare sector through our reviews of latest industry trends, regulatory changes and major deals, projects and investments in Vietnam.
  • Assess the activities, strategy and market position of your competitors using our company profiles (including SWOTs, KPIs and latest activity) and competitive landscape tables.

Coverage

BMI Industry View

An at-a-glance perspective on the latest regulatory developments, key forecast indicators and major corporate developments, covering the prescription, OTC and generics markets. The pharmaceuticals and healthcare SWOT outlines strategic factors that affect the basic assumptions underpinning BMI’s forecast analysis, and taken together with BMI’s political, economic and business environment SWOTs, it gives a complete overview of market climate.

BMI Industry Forecast Scenario

Industry forecasts to end-2019 for all key indicators, supported by explicit assumptions, plus analysis of key downside risks to the main forecasts:

  • Healthcare: Total healthcare expenditure (USDbn), healthcare expenditure (% of GDP), healthcare expenditure per capita (USD), hospital beds, doctors, and birth & mortality rates (all per ‘000 population).
  • Pharmaceutical Market: Drug expenditure in USDbn, % of GDP and per capita (USD).
  • Patented Drug Market: Prescription drug sales (USDbn & % of total sales).
  • Generic Drug Market: Generic product sales (USDbn), generic sales (% of total sales).
  • OTC Drug Market: OTC sales (USDbn & % of total sales).
  • Macroeconomic Forecasts: Nominal and real GDP, % real GDP growth, % private consumption growth, % industrial output growth, % consumer price index, % GDP price deflator, exports, imports, trade balance, current account balance, foreign direct investment, exchange rate against USD, government expenditure and external debt.

BMI’s Pharmaceuticals and Healthcare Risk Reward Index

BMI’s Risk Reward Index provides investors (both national and multinational) looking for opportunities in the region with a clear country-comparative assessment of the market’s risks and potential rewards. Each of the country markets are scored using a sophisticated model that includes more than 40 industry, economic and demographic data points to provide indices of highest to lowest appeal to investors, with each position explained.

Market Summary

A snapshot of key market characteristics, including total size of the pharmaceuticals and healthcare segments, growth drivers, leading therapeutic areas and the competitive landscape

Industry Developments

A focus on government healthcare reforms, epidemiological trends, mergers and acquisitions, product launches, market entries, FDI activity, R&D, biotechnology, clinical trials and supply chain issues.

Regulatory Regime

Details of the industry regulatory framework and key legislation covering the licensing of new products/services, pricing and reimbursements, intellectual property, taxation and advertising, as well as analysis of the overall regulatory burden.

Competitive Landscape

The competitive landscape section provides comparative company analyses and index by USD sales and % share of total sales – for the total pharmaceutical sector, as well as the OTC, generics and distribution sub-sectors.

Company Profiles*

Examines the competitive positioning and short- to medium-term business strategies of key industry players. Strategy is examined within the context of BMI’s industry forecasts, our macroeconomic views and our understanding of the wider competitive landscape to generate Company SWOT analyses. The latest financial and operating statistics and key company developments are also incorporated within the company profiles, enabling a full evaluation of recent company performance and future growth prospects.

*Company profiles are not available for every country. Those reports instead contain information on the current activities of prominent companies operating in the market.