Hanoi (VNS/VNA) - Vietnamese pharmaceutical companies areoptimistic about the business prospects of the sector, with nearly 80 percentof firms anticipating an annual industry growth rate of more than 10 percent.

This information was gathered in a survey released alongside alist of the top 10 most prestigious pharmaceutical companies in the country byViet Nam Report Company (VNR) on December 26 in Hanoi. The report compiledinformation from the IQVIA Institute for Human Data Science, the World Bank andmarket research firm Nielsen.

The IQVIA Institute for Human Data Science listed Viet Nam as a“pharmerging market” because its population is entering an aging stage. TheWorld Bank warns that Vietnam is experiencing rapid population aging. Theproportion of the population aged 65 and over was 6.5 percent in 2017 and isexpected to reach 21 percent by 2050, causing an increasing demand forhealthcare. Nielsen reported health was one of the top two concerns ofVietnamese consumers in 2018.

In addition, Vietnamese people have been paying more forhealthcare services due to increasing average income per capita coupled withrising environmental pollution that causes diseases.

Statistics from the Vietnam Drug Administration under the Ministryof Health showed the industry would continue to experience double-digit growthover the next five years and would reach 7.7 billion USD in 2021.

However, all of the surveyed firms said their biggest difficultywas their reliance on imported materials. In 2017, Vietnam imported 375 millionUSD of materials for pharmaceutical production, 78 percent of which from Chinaand India.

There has not been significant investment into traditionalmedicines to reduce reliance on imported products even though the country has arich supply of medicinal herbs.

The survey also revealed many big local and foreign businesseshave rushed to invest in the country’s pharmaceutical sector due to its hugepotential.

Euromonitor International said the average spending on drugs inVietnam was at 49.9 USD per capita in 2016, one-third of the global average.

The market potential has been attractive to foreign groups such asAbbott, which owns 51.7 percent of shares in Domesco, bought GlomedPharmaceutical, Taisho (which has 34.3 percent at Hau Giang PharmaceuticalJoint Stock Company) and Stada Service Holding BV. Local companies such asVingroup, FPT, Masan Group, Vinamilk, The gioi Di Dong and Digiworld have alsojumped into the sector.

Several local firms have sought ways to co-operate with foreigncompanies to take advantage of available markets and distribution channelsinstead of directly competing. Cooperation can help domestic firms attractcapital and gain technologies and experience from big global groups.

The list of the 10 most prestigious pharmaceutical companies wasbased on three criteria: financial capacity and performance on auditedfinancial reports last year, communication prestige, quality product anddistribution.

Mostof the companies in the list have stable financial capacity, long-termexperience and potential for growth as well as high quality products and widedistribution.-VNS/VNA