The pharmaceutical markets in Vietnam and the Philippines are forecast to reach a value of $8 billion each by 2020, according to new studies released by Texas-based research firm MarketOptimizer.org.
The study says that the pharmaceutical market in Vietnam is set to increase at an impressive 15.4 per cent annually to 2020, whereas the Philippines’ pharmaceutical industry will grow at 9.4 per cent per year to 2020. In Vietnam, the scarcity of low-priced generic drugs, combined with a belief among Vietnamese doctors that patent-protected branded drugs are more effective, means that foreign pharmaceutical companies dominate the market and are able to maintain premium revenue.
In 2005, innovator drug prices in Vietnam were 8.3 times higher than international reference prices. Although 2009 saw the Vietnamese government introduce the New Health Insurance Law for universal coverage by 2020, as well as make it a legal requirement for all of its pharmaceutical production facilities to operate with Good Manufacturing Practice certificates, prospects for generic and locally-manufactured drugs remain limited.
The report says: “A preoccupation with generic drugs and low investment in research and development means that domestic pharmaceutical companies are at a distinct disadvantage when competing against imports from multinationals.”
This is despite the fact that Vietnam is one of the fastest growing economies in the Southeast Asia region, with its GDP having increased significantly in value from $101.6 billion in 2008 to an estimated $170.6 billion in 2013. The Drug Administration of Vietnam issues a new drug registration within 180 days of an application being submitted. This makes the process much quicker than in the US and UK, although it is in line with other countries in Southeast Asia.
However, there are some obstacles that pharmaceutical manufacturers must face when launching new products into Vietnam’s pharmaceutical marketplace.
The report continues: “While the time taken to evaluate new and generic drug approvals is shorter than in developed countries, the application submission procedure is rigorous. Extra documentation is required, as is the mandatory submission of certain data in Vietnamese. This makes it more difficult for new products to enter this arena and will subsequently hinder any further market growth over the forecast period.”
The Philippines has the third largest pharmaceutical market among ASEAN countries, just after Indonesia and Thailand.
“Although an increasing disease burden, coupled with prevailing high pharmaceutical prices, are providing the necessary investment incentives for the healthcare market in the Philippines, limited access to healthcare facilities and governmental cuts could yet impede further growth in the future,” the report says.
Furthermore, public health insurance provider Philippine Health Insurance Corporation does not cover the country’s entire population, resulting in the majority of people being unable to afford medicines.
“The government has taken a number of measures to control the high drug prices to very little effect, thanks to the large amount of imported therapies and the demand for costly branded drugs,” the report states.
Additionally, high spending to overcome basic economic concerns, such as poverty, dependence on imports and high external debt, have left the Philippines’ government with insufficient funds to finance the development of healthcare infrastructure, according to this research
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