VIETNAM PLANNING TO STEM THE FLOW OF DRUG IMPORTS

Proposals under consideration by Vietnam's Industry Ministry will aim to reduce the country's reliance on imports. The new strategy, outlined by leading local manufacturer Vinapharm, calls for investment of US$285mn by 2010. The finance will be focused on producing antibiotics, APIs and vitamin C input sorbitol. Vietnam currently imports 90% of its pharmaceutical raw materials at an annual cost of US$480mn.

Vietnamese drugmakers are characterised by obsolete facilities, weak financial resources and poor management, while foreign-made products — which are perceived to be of higher quality — have captured a dominant market share in recent years. Currently, local drug production accounts for just 40% of Vietnam's drug sales. Just one producer, Mekopar, is responsible for much of the country's antibiotics output.

However, observers comment that the rise of imports reflects the failure of local companies to meet demand. Vietnam's overall drug demand is estimated at US$1.5bn per year.

Government plans to cut drug prices are also expected to stem the tide of drug imports. However, industry sources indicate that this work could be undone by recent legislation permitting local firms to conduct parallel imports of pharmaceuticals, undercutting domestic prices.