Front entrance of Euvipharm's headquarters, Long An province. Photo courtesy of Euvipharm.
By acquiring Euvipharm last week, JWP’s strategy is to make a full-scale entry into the pharmerging market of Vietnam and other ASEAN countries with locally manufactured products, it said in a statement.
Euvipharm, founded in 2005, owns a 35,000 square meter plant with the capacity to produce 1.94 billion pharmaceutical products a year, the largest capacity in Vietnam, JWP said.
"With the acquisition of Euvipharm, now we have secured a large-scale plant with advanced technology and modernized equipment in Vietnam, an emerging manufacturing powerhouse," said JWP’s CEO Yeong-seop Shin. "Beginning with Vietnam as our outpost, we will continue to expand JW brand in the global market."
In a recent analysis, ACB Securities said under WTO regulations foreign enterprises in Vietnam could import but not directly distribute drugs in Vietnam. To circumvent this, they use a Vietnamese firm to distribute their drugs in the market.
However, Vietnamese pharmaceutical companies with over 49 percent foreign ownership are only allowed to sell drugs they produce. Thus, foreign firms will have to transfer technology to the Vietnamese companies they buy to take advantage of the lucrative market.
According to a report by global research firm Business Monitor International, the Vietnamese drug industry grew at 16 percent a year in 2015-18, with sales hitting $10 billion.
The country still imports 55 percent of its drug needs, especially of patented drugs.