Vietnam healthtech sector turns investment magnet

By Lien Thuong, Minh Hue
Mon, May 6, 2024 | 10:26 pm GMT+7

Medical and pharmaceutical firms accounted for a lion’s share of $529 million that Vietnamese startups attracted in 2023 and this trend is set to continue, industry insiders say.

An FPT Long Chau pharma outlet in Ho Chi Minh City, southern Vietnam. Photo by The Investor/Minh Thong.

An FPT Long Chau pharma outlet in Ho Chi Minh City, southern Vietnam. Photo by The Investor/Minh Thong.

Late this January, a strategic partnership was struck by FPT Long Chau, the pharma arm of tech giant FPT Corporation, and IHH Healthcare Singapore.

The value of the deal was not disclosed. However, this can be considered a “first step,” marking the Vietnam presence of a famous name in the Asian healthcare industry.

IHH Healthcare Singapore has a network of 83 hospitals and medical facilities spanning 10 countries including Malaysia, Singapore, India and several European countries.

It posted revenues of more than $4.3 billion and pre-tax profits of $1 billion in 2023, after recording corresponding figures of $3.4 billion and $1.1 billion a year earlier.

Peter Chow, acting CEO of IHH Singapore, said they chose to "join hands" with FPT Long Chau instead of an M&A tech deal. He did not elaborate on the choice.

"We appreciate the achievements FPT Long Chau has made as a leading pharmaceutical retailer in Vietnam and are honored to be part of this to build a more robust healthcare ecosystem.

"This strategic cooperation between Long Chau and Parkway is not just about sharing expertise and advanced treatment techniques but also about creating a comprehensive healthcare environment that would improve the lives of the people of Vietnam," he said.

Chow said a wave of leading regional medical corporations landing in Vietnam showcases the market's development potential. Vietnam has a growing economy and the government’s open policies to attract investment as well as the people’s expectations for quality medical services are potent attractions, he added.

He said Singapore’s demographics, with one in every four people 65 years old or older, prompted the island nation’s healthcare industry to develop strongly and early. This has been followed by a wave of investments in other developing markets like Vietnam.

Pricing is a challenge for Vietnam's healthcare industry, Chow said. If Vietnam wants to develop, it must make medical cost suitable for the majority of indigenous people, he added.

Vibrant M&A activity

Meanwhile, an M&A market report by BDA Partners, a global investment banking advisor for Asia, says the healthcare industry was one of the industries that saw vibrant M&A activity in 2023, in terms of both transaction volume and value, with up to 15 deals worth nearly $765 million. The average transaction value in the healthcare sector in 2023 hit $100 million, up from $65 million in 2022.

The report attributes the development to people's increased awareness of healthcare, stability and resilience to economic recession, favorable demographic factors and a growing middleclass with unmet demand for quality healthcare services.

The Vietnam Innovation & Tech Investment Report 2024 published by the National Innovation Center (NIC) and investment fund Do Ventures shows that in 2023, Vietnamese tech startups received a total investment of $529 million, a 17% drop from the previous year.

While challenging global worldwide economic conditions contributed to this fall, the healthcare sector witnessed record-high investments, making it the leader with a remarkable year-on-year growth of 391%, the report says.

Other sectors with impressive growth included education, which boasted a 107% year-on-year increase; and travel and hospitality, up 305% and 132%, respectively.

The report says that besides market factors, technology was another reason why medical and pharmaceutical companies in general and startups in this industry in particular have received large investments.

Last year, Singapore took the lead as the most active investor in Vietnam’s tech sector. In Southeast Asia, Vietnam stood third in the number of deals and investment value after Singapore and Indonesia.

Over the last 10 years (2014-2023), more than $4.6 billion was poured into Vietnamese startups through 835 deals. Of these, 2021 witnessed 165 deals worth more than $1.44 billion, the largest so far.

Vu Quoc Huy, director of NIC, said Vietnam, with its 100-million population, has been an attractive destination for technology investment in the region in recent years, with its the digital economy seeing the highest growth in Southeast Asia for two consecutive years (2022 and 2023).

"Amidst the uncertainties of the global economy, technological innovation has become an important factor promoting Vietnam's sustainable economic development," Huy said.

Comments (0)
  • Read More
Thailand’s WHA greenlighted to invest $55 mln in central Vietnam industrial park

Thailand’s WHA greenlighted to invest $55 mln in central Vietnam industrial park

WHA Group, a leading Thai provider of fully integrated logistics and industrial facilities solutions, has secured in-principle approval from the Vietnamese government to invest in an industrial park in central Vietnam.

Industrial real estate - Wed, November 20, 2024 | 12:01 pm GMT+7

Indonesia, Brazil sign cooperation deals worth $2.65 bln

Indonesia, Brazil sign cooperation deals worth $2.65 bln

Indonesia and Brazil on Monday sealed cooperation agreements worth $2.65 billion in the areas of renewable energy, sustainable agriculture and technology at the Indonesia-Brazil Business Forum held in Rio De Janeiro, Brazil, on the sidelines of the G20 Summit.

Southeast Asia - Wed, November 20, 2024 | 11:57 am GMT+7

Nusantara not yet feasible as Indonesia’s capital city: authorities

Nusantara not yet feasible as Indonesia’s capital city: authorities

Indonesian Minister of Home Affairs Tito Karnavian said Jakarta still holds the capital status despite the enactment of State Capital Law No. 3 of 2022, adding that the capital city will officially be relocated after the president issues a presidential decree.

Southeast Asia - Wed, November 20, 2024 | 11:55 am GMT+7

Malaysia’s Halal industry to make up 10.8% of GDP by 2030

Malaysia’s Halal industry to make up 10.8% of GDP by 2030

Malaysia’s Halal industry is projected to account for 10.8% of the country's GDP by 2030, with an estimated value of RM231.1 billion ($51.7 billion).

Southeast Asia - Wed, November 20, 2024 | 11:48 am GMT+7

Thailand takes more fiscal measures to sustain growth momentum

Thailand takes more fiscal measures to sustain growth momentum

The Thai government is working on a raft of fresh fiscal measures to sustain an economic recovery, foster new foreign investment, and lower the near-record household debt, says Thai Prime Minister Paetongtarn Shinawatra's top aide.

Southeast Asia - Wed, November 20, 2024 | 11:46 am GMT+7

Indonesia named world's most generous country in 2024

Indonesia named world's most generous country in 2024

Indonesia has been the world's most generous country for the seventh consecutive year since 2017, reported local weekly magazine Tempo.

Southeast Asia - Wed, November 20, 2024 | 11:41 am GMT+7

Work begins on Mitsubishi Estate’s $55 mln logistics facility in northern Vietnam

Work begins on Mitsubishi Estate’s $55 mln logistics facility in northern Vietnam

Logistics facility brand Logicross, under Japan’s Mitsubishi Estate, kicked off the construction of its Logicross Hai Phong ready-built warehouse in Vietnam’s northern city of Hai Phong on Tuesday.

Industrial real estate - Wed, November 20, 2024 | 10:58 am GMT+7

French logistics giant eyes to launch electric barges on inland waterways in Vietnam

French logistics giant eyes to launch electric barges on inland waterways in Vietnam

CMA-CGM Group, a French shipping and logistics company, has plans to deploy electric barges, initially on inland waterways in Vietnam.

Companies - Wed, November 20, 2024 | 10:43 am GMT+7

2025 a turning point for Vietnam stock market: broker

2025 a turning point for Vietnam stock market: broker

Vietnam's stock market has struggled to capture the attention of both domestic and foreign investors in recent months, reflected by persistent foreign capital outflows and a steady decline in market liquidity, but next year will be a turning point for the market, says Chen Chia Ken, CEO of Phu Hung Securities JSC.

Finance - Wed, November 20, 2024 | 7:07 am GMT+7

Construction trio keen on building $1.5 bln expanded expressway in southern Vietnam

Construction trio keen on building $1.5 bln expanded expressway in southern Vietnam

Three construction majors in Vietnam are interested in building an expanded expressway connecting Ho Chi Minh City with the Mekong Delta provinces of Long An and Tien Giang for an estimated VND38.6 trillion ($1.52 billion).

Infrastructure - Tue, November 19, 2024 | 8:18 pm GMT+7

Singapore, Germany upgrade relations to strategic partnership

Singapore, Germany upgrade relations to strategic partnership

Singapore and Germany have decided to elevate their ties to a Strategic Partnership to promote closer cooperation in areas of mutual interest such as security, artificial intelligence (AI) and clean energy.

Southeast Asia - Tue, November 19, 2024 | 8:01 pm GMT+7

Thailand’s rice shipment up 20% in 10 months

Thailand’s rice shipment up 20% in 10 months

Thailand exported 8.37 million tons of rice in January-October, a year-on-year increase of 20%, according to the Ministry of Commerce.

Southeast Asia - Tue, November 19, 2024 | 8:00 pm GMT+7

Vietnam’s inconsistent legal framework poses problems for FDI sector: Deep C exec

Vietnam’s inconsistent legal framework poses problems for FDI sector: Deep C exec

Vietnam’s legal framework lacks consistency and the foreign direct investment (FDI) sector will soon face challenges related to the Law on Environmental Protection, says Bruno Jaspaert, CEO of Deep C Industrial Zones.

Economy - Tue, November 19, 2024 | 6:30 pm GMT+7

Vietnam shares sink on extended foreign selloffs

Vietnam shares sink on extended foreign selloffs

Vietnamese equities fell for a fourth consecutive day on Tuesday as foreign traders extended their selling spree.

Finance - Tue, November 19, 2024 | 5:10 pm GMT+7

Germany’s household product firm QuickPack to invest $32 mln in Vietnam

Germany’s household product firm QuickPack to invest $32 mln in Vietnam

Germany’s QuickPack, a specialist for household goods and hygiene products, will invest €30 million ($31.8 million) in Vietnam’s Mekong Delta province of Long An.

Industries - Tue, November 19, 2024 | 4:24 pm GMT+7

Malaysian millionaire willing to invest in convicted Vietnamese tycoon’s property project: lawyers

Malaysian millionaire willing to invest in convicted Vietnamese tycoon’s property project: lawyers

Malaysian millionaire Vincent Tan has evinced investment interest in a residential project owned by convicted tycoon Truong My Lan, chairwoman of Van Thinh Phat Group, lawyers for the latter have disclosed.

Real Estate - Tue, November 19, 2024 | 4:17 pm GMT+7