ROK drug companies target Vietnamese market
VOV.VN - Leading pharmaceutical companies from the Republic of Korea (ROK) are pouring money into Vietnamese operations as they battle for increased market share in the fast-growing generics segment.
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The Vietnam government is initiating a competitive bidding system for generic drugs imported and distributed in the country for which it divides foreign suppliers into five classes and sets a limit on their participation in bidding.
Up until recently the highest rating given to any company from the ROK was to Korea United Pharm, which had a Grade 3, with all other pharmaceuticals from the East Asian country classified into Grade-5 suppliers.
However, in January, Vietnamese officials raised eight Korean pharmaceuticals to Grade 2.
The latest move came after the Korean Ministry of Food and Drug Safety requested Vietnam to recognize its Good Manufacturing Practice certificate and accession to the Pharmaceutical Inspection Convention and Pharmaceutical Inspection Cooperation Scheme.
The eight pharma companies are Dongkwang Pharm, Dongkook Pharmaceutical, Myungmoon Pharmaceutical, Samil Pharm, Samjin Pharm, JW Life Science, LG Chem and Korea United Pharm.
The Grade 2 classification benefits the eight ROK pharmaceuticals in the competitive bid process in Vietnam when they submit proposals for medications, ointments, vaccines and other generics.
New pharmaceutical law
The National Assembly of Vietnam adopted a new Law on Pharmacy last June and it came into effect January 1, 2017.
The new law specifically allows parallel import of drugs so long as the price of the parallel-imported product is lower than the price of the original brand-name drug currently being circulated in Vietnam.
Though the general concept of parallel imports is not new to the pharmaceutical industry in Vietnam, this is the first time that a regulation on parallel imports has been promulgated under a law.
Market outlook
The pharmaceutical market in Vietnam is forecast to increase from US$4.2 billion in 2015 to US$7.2 billion by 2020, according to a report by BMI Research.
The domestic pharmaceutical segment is still very fragmented and the management standards typically are quite poor, say most industry analysts, which provides strategic investors from the ROK a golden opportunity.
