29 Apr 2014, BioSpectrum Bureau , BioSpectrum
Singapore: The Vietnam pharmaceutical market grew nearly 17 percent last year, valuing over $3 billion.
A new study by Decision Resources predicted that the market will grow a further 20 percent by 2017. "Vietnam is one of Southeast Asia's fastest-growing pharma markets, with demand for prescription medicines being fuelled by a range of drivers including increasing affluence, a rapidly-aging population and the steady extension of public health insurance," the study said.
It added, Vietnam has set the goal of achieving universal health coverage by 2015, which is ambitious given that over 30 percent of the population still has no form of public health insurance and that private health expenditure remains high at 57 percent of the country's total health spending.
"Drug prices are comparatively high, at 12 times above the level of international reference prices. And difficulties in containing prices are exacerbated by a fragmented healthcare system, a decentralised medicines procurement process and heavy dependence on imported drugs," the study explained further.
Moreover, negotiations to join the Trans-Pacific Partnership (TPP) free trade agreement - currently ongoing between the US, Australia, Brunei Darussalam, Chile, Malaysia, New Zealand, Peru, Singapore and Vietnam - have caused concern among government officials and experts because agreeing to TPP proposals may constrain the country's ability to curb rising drug costs.
Also, Vietnam's intellectual property rights protection is weak, and the lack of regulatory transparency and high penetration of counterfeit drugs into the market has contributed to the Pharmaceutical Research and Manufacturers of America (PhRMA)'s request to keep Vietnam on the US Trade Representative (USTR)'s Special 301 Report Watch List for 2014.
"Vietnam's population reached 90 million by the end of 2013, making it the third most populous country in Southeast Asia and a sizable market for foreign drug manufacturers to consider for investment. An estimated market growth rate of 20 percent through 2017 should signal Vietnam's importance in any company's strategic planning when exploring opportunities in developing markets," opined Mr Jonathan Chen, Decision Resources analyst.
But he also notes that signing off on the TPP agreement would require Vietnam to concede an additional period of data exclusivity on top of a 20-year patent term.
"This data exclusivity period, which denies drug regulators the use of clinical trial data from the originator to approve generic alternatives until the period expires, typically lasts at least five years, and may not begin until closer to the end of the 20 year patent term. This effectively delays generic competition and keeps drug prices high, outcomes that work against the interests of the country," he further added.