VF Franchise Consulting

Pharma field is growing

May 22, 2013

Foreign pharmaceutical companies are exploring healthy Vietnamese sectoral options.

Several foreign pharmaceutical firms are exploring the option of expanding in Vietnam – Photo: Le Toan

Shakeel Akhter, export manager of Pakistan’s Sante Limited, told VIR at Vietnam Medi-Pharm 2013 exhibition in Hanoi two weeks ago that many Pakistani pharmaceutical companies “may build production factories in Vietnam, and the products will both be marketed in the country and exported.”

“Many of our foreign rivals in India and South Korea have yet to build factories here and we will have to grab this opportunity. We will likely build a factory in Vietnam over the next several years.”

Sante is now finding distributors in Vietnam for its three lines of products used for treating hair, eye and throat diseases.

Pakistan’s Life Pharmaceutical Company’s marketing director Zeeshan Haider told VIR this company “may build a factory in Vietnam over the next five years.”

“But in order to do that we will work with the Vietnamese governmental authorities and some companies like Ha Tay Pharmaceutical to export products to Pakistan,” Haider said.

Vietnam is now home to 600 foreign pharmaceutical companies, however, they are almost all engaged in product distribution. Only several companies have built their own factories like France’s Sanofi with three factories and Japan’s Rhoto Pharmaceutical with two factories in the country. For instance, Sanofi in March 2013 announced the construction of its third $75 million factory in Ho Chi Minh City. This factory is expected to begin production in 2015 and market products in 2016.

However, some foreign companies’ representatives told VIR they would not build factories in Vietnam.

The UK’s Robinson Pharma’s Ho Chi Minh City-based representative office chief representative Dinh Dung said: “Vietnam has no materials Robinson needs to make its products. This is one of the reasons behind the company having no intention of directly investing here.”

Meanwhile, China’s Zhejiang Shibiling Pharmacy sales manager Manning Kang said despite Vietnam’s big potential, many companies like Zhejiang Shibiling would not directly produce in the country.

“Foreign companies will face scarcity of raw materials and weak protection of intellectual property rights in Vietnam. As a result, Vietnam is mainly a distribution market, not a production base for many foreign pharmaceutical companies,” Kang added.

For example, GlaxoSmithKline is cooperating with local pharmaceutical firms instead of manufacturing on its own.

In January 2013, Singapore-based Inviragen licenced its Japanese encephalitis (JE) technology to Vietnam’s Company for Vaccine and Biological Production No1. Under the agreement, Vabiotech can exclusively develop and commercialise JE vaccines in Vietnam, Cambodia and Myanmar. Taiwanese-backed TTY Biopharm is finding local pharmaceutical factories to transfer technologies and produce anti-cancer drugs, while Hong Kong’s Aloha Medicinals Asia is looking for local partners to distribute mushroom-extracted products in Vietnam.

By Thanh Thu

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