“There is an enormous potential for Vietnam to purchase generic medicines from India, but the former is actively trying to get Indian pharmaceutical companies to manufacture in Vietnam instead of importing,” it added.
India is Vietnam’s third largest supplier of pharmaceutical products, with an export turnover of USD 198 million in the first nine months of 2020.
In addition to finished products, the country also provides raw pharmaceutical materials, and generic medicines for the Vietnamese market.
The medicines and raw materials imported from India are reasonably priced and meet the diverse needs of Vietnamese, especially those living in remote areas, Fitch Solutions said.
Vietnamese pharmaceutical firms want to cooperate and call for investment from foreign companies, including those from India to attract capital, technology and high quality human resources, it added.
“Therefore, there is room for cooperation between Vietnamese and Indian businesses in the field,” it added.
Fitch noted that Vietnam’s generic drug market will post robust growth rates over the coming years, driven by the government’s encouragement of the predominant generic-based local industry, as well as the expansion of healthcare services.
Domestic medicine production will remain firmly within the generic drug sector given the lack of scientific expertise for innovative drug development, but primarily due to the significantly higher demand for generic drugs in the country as a whole, it added.
In addition, while the development of healthcare services in Vietnam will increase the ability for patients to access higher quality medicines, affordability levels remain low and as such opportunities for patented drugmakers will remain severely restricted, the report said.
“Generic drugs will continue to account for the majority of prescription drug sales with a value estimated at VND 66trn (USD 2.9 billion) in 2020. We expect this to grow to VND 171trn (USD 6.7 billion) by 2030,” Fitch said.
This is a ten-year compound annual growth rate of 10 per cent in local currency terms and 9 per cent in US dollar terms, it added.