Market Report, "Vietnam Pharmaceuticals & Healthcare Report Q3 2013", published

Vietnam's pharmaceutical and healthcare sectors are set to see strong growth, albeit from a low base, given our bullish outlook on the economy and expectations for the population's affluence to rise. In addition, the government is committed to implementing universal healthcare coverage. The plan, while ambitious, will provide growth opportunities for pharmaceutical firms. As the scheme is implemented, patients will have increased access to medical services. Nevertheless, we highlight that a key downside risk to our view is the existence of rampant corruption.

Headline Expenditure Projections

* Pharmaceuticals: VND59,214bn (US$2.84bn) in 2012 to VND69,151bn (US$3.31bn) in 2013; +16.8% in local currency terms and +16.6% in US dollar terms. Forecast broadly in line with Q213.
* Healthcare: VND199,197bn (US$9.55bn) in 2012 to VND227,558bn (US$10.89bn) in 2013; +14.2% in local currency terms and +14.0% in US dollar terms. Forecast upgraded due to receipt of new data from the World Health Organization.

Full Report Details at
- http://www.fastmr.com/prod/648419_vietnam_pharmaceuticals_healthcare_report_q3_2013.aspx?afid=301

Risk/Reward Rating:

Vietnam's Pharmaceutical Risk/Reward Rating (RRR) score for Q313 is 50 out of the maximum 100 in our newly improved RRR system. The country scored above average for some indicators and sub-indicators, including overall market expenditure and sector value growth, pensionable population. Consequently, with this moderate score Vietnam is ranked 12th behind Thailand but in front of Indonesia out of the 18 key markets in Asia Pacific.

Key Trends And Developments

* In June 2013, Daiichi Sankyo's subsidiary, Kitasato Daiichi Sankyo Vaccine, and the Japan International Cooperation Agency (JICA) began technical co-operations to produce the first measlesrubella combined vaccine in Vietnam.
* In April 2013, the Vietnamese health ministry issued Circular No10/2013/TT-BYT, modifying and supplementing several articles of Circular No. 02/2007/TT-BYT on conditions for the drug business. The amendment circular is intended to bring about various new regulations on conditions for the drug industry under Decree No. 89/2012/ND-CP, executing the Law on Pharmacy 2005. Under the amendment circular, the Provincial Department of Health shall be authorised by the health ministry to provide certificates, such as a good practice certificate, if foreign-owned enterprises' businesses are in drugs production, drugs maintenance, drug testing or import of drugs. The amendment circular was implemented from May 14 2013.
* The Drug Administration of Vietnam (DAV) has banned the advertisement of nutritional supplements from April 26 2013, due to the chaotic state of the advertising system. In an interview with local media Hai Quan in October 2012, Nguyen Thanh Phong, deputy director of DAV, stated that while the agency reviews such advertisements, preventing violations is difficult, as some advertising agencies are not registered with the authorities.

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