Mr. Vu Tuan Cuong, Director of Drug Administration of Vietnam, said that the pharmaceutical market of Vietnam is currently worth USD 5.2 billion with the growth rate of 12% per year.
Despite rapid growth, Vietnam's production capacity can only meet 53% of domestic pharmaceutical demand. In 2018, Vietnam's spent nearly USD 2.8 billion on importing pharmaceuticals. In 2019, this spending increased by 10%. Vietnam is also highly dependent on imported pharmaceutical materials, mainly from China with more than 60% of demand.
Market research firm IBM said that the size of Vietnam's pharmaceutical industry may reach USD 7.7 billion in 2021 and USD 16.1 billion in 2026. Market research firm IMS Health also forecasts that per capita spending on pharmaceuticals in Vietnam will rise to USD 50 per person in 2020.
In addition, many large pharmaceutical manufacturing enterprises such as Hau Giang Pharmaceutical, Bidiphar, Imexpharm, and Pymepharco have been investing in upgrading factories, which promises to make breakthroughs in developing new domestic pharmaceutical products, improving the competitiveness with imported products.
The General Statistics Office forecasts that the number of Vietnamese people aged 65 and over is expected to reach 7.4 million in 2020, and will account for nearly 7.9% of the country's total population and for 18.1% in 2049.
According to a report by the Vietnam Social Insurance Agency, in 2010, only 60% of Vietnam’s population had health insurance, while in 2019, this figure was 90%. Another driving force for the pharmaceutical industry is rapid urbanization rate. Vietnam's urbanized population will reach 36.2 million at the end of 2020, an increase from 33.6% in 2015 to 36.8%.
Drug is currently distributed mainly via ETC channel which accounts for 70. There are about 57,000 drugstores nationwide. The development of the ETC channel comes from the health insurance policy of the Government which makes health insurance compulsory. In addition, that private hospitals flourished and awareness of health is increasing has led to higher number of people going to hospital, which increases the demand of drugs.
Bonny Le - VietnamCredit