Foreign drugmakers ramp up investments in Vietnam

Logo of Sanofi, one of the world's leading pharma companies. Photo courtesy of the firm.
Multinationals are scaling up investments in the growing pharmaceutical industry in Vietnam, which boasts a population of 100 million and a medicine market valued at $6.2-6.4 billion a year.
Robust industry development has been driven by Vietnamese people's increasing care about their health and rising disposable income, with the expected to gain in strength.
European footprint
France-based giant Sanofi’s Vietnamese unit has just inaugurated a modern warehouse meeting Good Storage Practice standards at Long Hau Industrial Park in Long An province, which borders Ho Chi Minh City. The facility is about one hour’s drive from the $75-million plant in HCMC’s Saigon Hi-Tech Park the French heavyweight built in 2013 to boost supplies across Southeast Asia.
The new warehouse is expected to bolster Sanofi’s supply chain in Vietnam and ensure smooth delivery of its drugs, vaccines, and consumer healthcare products across the burgeoning market, Sanofi Vietnam said at the warehouse opening ceremony on July 13. It was built using environment-friendly materials, helping reduce greenhouse effects and heat insulation.
“We set very strict standards for storage, transport and handling of goods to ensure optimal product quality,” said Emin Turan, country lead of Sanofi Vietnam and Cambodia.
To optimize space utilization and economic efficiency, it is equipped with two narrow-aisle trucks imported from Germany able to transport over 200 pallets of products daily.
Sanofi operates three manufacturing facilities in Vietnam, all located in HCMC. While kicking off construction of the third in 2013, Sanofi’s global operations president Hanspeter Spek said Vietnam was his group’s second-most important market in Asia after China.
British global healthcare company GSK launched in May its new entity in the market, GSK Pharma Vietnam Co. Ltd., with $200 million in investment capital, as the next development replacing the European giant’s Vietnam representative office. GSK said the office had contributed to preventing and treating diseases in Vietnam with its vaccines and drugs over three decades.
The new firm aims to deliver positive impacts on healthcare quality for more than one-third of the Vietnamese population over the next three years. GSK said in a release that the new subsidiary would continue operating and growing sustainably and responsibly in the country to become “one of the most innovative, best performing, and trusted healthcare companies.”
“We aim to protect six out of 10 newborn babies from life-threatening vaccine-preventable diseases and hundreds of thousands of adults and groups with underlying conditions,” said medical doctor Pham My Lien, GSK Pharma Vietnam president. She added her company would also provide treatments for millions of asthma and chronic obstructive pulmonary disease patients.

GSK Pharma Vietnam president Pham Thi My Lien gives a speech while launching the firm in Ho Chi Minh City on May 11, 2022. Photo courtesy of the company.
Marking its debut, GSK Pharma Vietnam signed cooperation deals with Vietnam Medicine Association, Phytopharma JSC, and Vietnam Vaccine JSC (VNVC) to provide continuing medical education to enhance the quality of treatment and clinical practice for healthcare professionals across the country. The parties will also strengthen knowledge exchange, expand immunization coverage to children and adults in the country, and promote disease awareness among the general public.
Indian investors
Vietnam's pharmaceutical industry was estimated to grow 15% in 2021, according to Saigon Securities Inc. analysts. Like other foreign companies, Indian drugmakers are seeking inroads into the fast expansion.
Two Indian companies, Sri Avantika Contractor and SMS Pharmaceuticals, signed a cooperation agreement with Vietnamese industrial property developer Dai An JSC this February to build an Indian-invested pharmaceutical park in Hai Duong province near Hanoi, with total investment capital likely to reach $10 billion.
The project will cover more than 900 hectares in Binh Giang and Thanh Mien districts. It will be implemented in two phases of investment, according to local media.
Addressing the signing ceremony, Hai Duong’s Party chief Pham Xuan Thang pledged to provide the best support toward the project, the largest of its kind in the province.
In the central province of Thanh Hoa, a partnership between the three companies is set to build another pharmaceutical park worth around $500 million.
The project is expected to deliver an export revenue of $3 billion annually, creating 50,000 direct and 200,000 indirect jobs.
At an India-Vietnam pharmaceuticals and healthcare conference held in HCMC on July 5, Le Ngoc Danh, deputy head of HCMC Department of Health's pharmacy division, said the Vietnamese pharmaceutical market was currently valued at $6.2-6.4 billion.
Tran Ngoc Liem, head of the Vietnam Chamber of Commerce and Industry’s HCMC branch, said India is the third biggest pharmaceuticals supplier to Vietnam. "Pharmaceutical and healthcare partnerships, among joint operations in many other fields where the two countries hold advantages, would help both reach their 2022 bilateral trade target of $15 billion," he noted.
Around 300 Indian drug companies already have representative offices in Vietnam, including large firms like Sun Pharma, Natco, and Mylan, but there is not a joint venture between the two nations’ companies, Liem added.
At the event, Pranay Verma, India’s ambassador to Hanoi, said cooperation in the pharmaceutical sector was a significant factor in the two countries’ economic ties. He encouraged Indian companies to explore partnerships and investments in Vietnam.
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