The most attractive feature of Vietnam’s US$ 1.15bn pharmaceutical market is the double-digit growth that is expected over the next five years. This increase in sales will be driven predominantly by more people on low incomes accessing greater units of higher-value medicines. Inflationary pressures will also push prices up, but we are expecting a tighter regulation in the near future to maintain market equilibrium. By 2012, the value of the country’s pharmaceutical market will have reached US$ 1.85bn, or 1.05% of GDP.
A year after WTO accession, the number of foreign pharmaceutical firms now operating in Vietnam has increased sharply. However, the local pharmaceutical sector is still dependant on imported materials despite expansive growth. According to the Head of the Vietnam Pharmaceutical Management Bureau, the number of foreign firms rose by 58 during 2007, bringing the total number to 370. Vietnam needs to increase healthcare spending significantly and improve the distribution of funds to reduce inequalities among its population, according to panel of stakeholders that includes UN representatives. Allocation of 10% of the government budget to health by 2010 was suggested; however, Vietnam's Ministry of Health has said that this target is not feasible and that 10% by 2015 is more realistic.
Asthma is under-diagnosed and an increasing burden in Vietnam, according to a recent study. Greater awareness of the respiratory disease will result in fewer hospital admissions and greater use of preventative agents such as inhaled corticosteroids. BMI believes that this presents an opportunity for pharmaceutical companies and medical device manufacturers in this field.
Vietnam's pharmacy sector is a shambles. Patients can get most drugs without a prescription, there are insufficient pharmacists, counterfeits are not uncommon and many doctors still illegally disburse medicines from their private offices. Regulators hope that the implementation of Good Pharmacy Practice (GPP) in 2011 will solve these problems, but numerous challenges must be addressed first.
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