New players to re-shape pharma sector

Viet Nam’s pharmaceutical retail industry is forecast to see significant competition in 2018, with the entry of new players with strong financial capacity and experience in distribution. In the final days of 2017, Mobile World Investment Group (MWG) announced its acquisition of HCM City-based Phuc An Khang pharmacy for an undisclosed sum. However, the annual shareholders’ meeting in April approved a budget of VND2.5 trillion (US$110 million) for merger and acquisition (M&A) activity, of which VND500 billion will be pumped into pharmaceutical retail. Also in early December, chairwoman of FPT Digital Retail JSC Nguyen Bach Diep bought Long Chau pharmacy, HCM City’s biggest drugstore chain. Though saying it was just Diep’s private investment, the deal is speculated as an initial step for FPT Retail to enter the pharmaceutical distribution sector. Another big electronics retailer, Nguyen Kim Group, in November made a public bid for Lam Dong Pharmaceutical JSC’s shares, following which it is ready to spend about $3 million to raise its ownership from 24 per cent to over 51.14 per cent. Apart from Lam Dong Pharmaceutical, Nguyen Kim Group is also investing in FT Pharma. Earlier in August, Digiworld Corp signed up with Vinamedic to distribute food supplements for men. A $5 billion market Viet Nam’s pharmaceutical retail sector is considered ‘fertile ground’ for big distributors, with total revenues of up to US$4.7 billion in 2017, up 13 per cent year-on-year, according to Business Monitor International (BMI), and is expected to swell to $7.7 billion in 2021 and $16.1… [Read full story]

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