Vietnam Pharmaceutical Industry Updates

Vietnam’s pharmaceutical industry stands out as a rapidly expanding market in Southeast Asia, offering significant opportunities for U.S. exporters.

The sector has demonstrated robust growth, with an average annual growth rate of 10% from 2016 to 2022. According to Fitch Solutions, the Vietnam Pharmaceuticals market was valued at USD 6 billion in 2023 and is projected to reach USD 8.7 billion by 2028, ultimately hitting USD 11.6 billion by 2033.

Market Structure

The Vietnamese pharmaceutical market is categorized into two primary channels:

• Hospital Channel (ETC): Accounts for 70% of market share with a 12% annual growth rate.
• Retail Channel (OTC): Representing around 30% of market share, the OTC sector has an average annual growth rate of approximately 8%.

Prescription Drugs vs. OTC Market

The prescription drug segment is anticipated to experience significant growth, fueled by advancements in healthcare infrastructure. Sales of prescription drugs reached USD 4.6 billion in 2023, with forecasts estimating growth to USD 9.1 billion by 2033.

The OTC market is expected to grow at a slower rate, primarily due to increased health insurance coverage and rising demand for prescription drugs. OTC sales amounted to USD 1.4 billion in 2023, with projections indicating a rise to USD 2.4 billion by 2033.

Drivers of Growth

1. Demographics: The aging population drives increased demand for healthcare and pharmaceutical products. In 2024, 14.2 million people (over 14% of the population) were over 60 years old, a figure projected to reach 29.22 million by 2050.
2. Economic Growth: Rising incomes and improved healthcare infrastructure, including 62,000 retail pharmacies and 5,000 wholesalers, are enhancing access. Per capita pharmaceutical spending is expected to reflect yearly annual growth of 7.8% between 2021 and 2026.
3. Health Trends: The increasing prevalence of chronic diseases and lifestyle-related illnesses are driving the demand for both innovative and generic medicines.

Regulatory Changes

On September 5, 2022, the Ministry of Health implemented Circular 08/2022/TT-BYT (Cir. 08), which replaced Circular 32/2018/TT-BYT. Effective October 20, 2022, the key changes in Cir. 08 include:

• Certificate of Pharmaceutical Products (CPP) content requirement:  The content requirement has been adjusted to align with international standards, specifically the WHO-CPP template, eliminating certain Vietnam-specific requirements.
• The Certificate of Pharmaceutical Products (CPP) content requirement:  Cir. 08 removed Vietnam-specific requirements and now harmonizes with international practice, specifically the WHO-CPP template.
• Risk-Based Verification:  Verification is no longer a blanket requirement for all dossiers. A risk-based approach is now applied, enabling verification through various channels in conjunction with the Marketing Authorization review process.

Opportunities for U.S. Companies

U.S. companies have significant opportunities in Vietnam by collaborating with local distribution firms, establishing joint ventures, or acquiring local businesses to overcome distribution restrictions. This strategy allows them to effectively distribute both imported and locally produced drugs while leveraging established local networks for efficient market entry.

By focusing on high-value drugs of high-demand niches like oncology, cardiology, and biologics, where local production is limited and investing in branding to address consumer concerns about counterfeit products, U.S. companies can capitalize on Vietnam’s preference for trusted, high-quality brands and establish a strong market presence.

For more information on opportunities in Vietnam, please contact the U.S. Commercial Service Vietnam’s Commercial Specialists for the Healthcare Sector, Mr. Thao Nguyen (HCMC) at Thao.Nguyen@trade.gov and Ms. Nhung Nguyen (Hanoi) at Nhung.Nguyen@trade.gov.