Foreign pharma companies losing ground in Vietnam

 13-Mar-15, Nikkei Asian Review

Vietnam has been a strong source of double-digit growth for foreign pharmaceutical and medical device companies over the past decade. However, fears are growing among European and American executives that the good times may be coming to an end.

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The growth rate of the pharmaceutical and device markets is reported to have been just below 14% in 2013-2014. This would have been welcomed anywhere else, but in Vietnam, where foreign companies have been used to 17% and even 20% growth rates for the better part of a decade, the numbers are a cause for concern.

Indeed, if compared to the projected growth rate of Vietnam's overall health care market at between 16% and 17% for 2014, the pharmaceutical and medical device markets seem to have underperformed by a large margin.

Allocations of contracts to local players, reportedly behind closed doors and outside the official tender process, have been to the tremendous detriment of foreign pharmaceutical and device companies, which count on public hospital tendering for well over 90% of revenues.

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