German company plans complete takeover of Vietnamese pharma firm
	Japanese cosmetic, pharmaceutical store chain first opens in Vietnam
	Foreign capital to pour more into Vietnamese pharmaceuticals

Dutch firm Stada Service Holding B.V. last month obtained permission from Vietnam's Pymepharco to increase its ownership in the Phu Yen Province-based company to 100 percent, VNExpress reported.

Pymepharco headquarters in Phu Yen Province in central Vietnam. Photo courtesy of Pymepharco.

STADA had increased its stake in Pymepharco by six percent to nearly 76 percent last week. The deal is estimated at around VND380 billion ($16.4 million), based on the closing stock price on December 11.

In September, Hanoi-based Hataphar issued an additional 5.28 million shares, or 20 percent of its charter capital, to Japan’s ASKA Pharmaceutical Co., Ltd. The deal was valued at VND370 billion ($16 million).

Antibiotics pills. Photo by Shutterstock/nokwalai.

The Japanese pharmaceutical company said that the purpose of the transaction is to establish business locations in Southeast Asia and build a platform to expand operations in the international market, reported by Monetary Security.

Earlier last year, Japan’s Taisho Pharmaceutical took a controlling share of over 51 percent in the DHG Pharmaceutical Joint Stock Company, the biggest pharmaceutical firm in the Mekong Delta region.

In December 2017, CFR International SpA, a subsidiary of U.S.-based medical corporation Abbott Laboratories, transferred all of its 51.69 percent stake in Domesco Medical Import Export JS Corp, based in the southern province of Dong Thap, to another Abbott subsidiary in a transaction valued at around VND2.3 trillion ($99.5 million).

Illustrative photo: Investment News

Vietnam’s rapidly growing pharmaceutical industry has been a magnet for foreign firms. The industry is set to record double-digit growth in the 2020-2025 period and is set to reach a value of $7.7 billion next year, according to a report by brokerage Yuanta Vietnam, according to VNExpress.

There is a rising demand for healthcare products and services, and with domestic production unable to meet it, Vietnam imported $3 billion worth of medicines last year. This figure is set to reach $4.35 billion this year, the report said.

Foreign firms are therefore keen on pouring cash into companies with growth potential, like DHG, which ranks fourth in market share behind three multinational pharma giants.

Analysts of Rong Viet Securities Corporation said that their strategy is to help Vietnamese companies increase their manufacturing standards and eventually take over instead of establishing its own business and build a factory.

CFR International SpA, a leading pharmaceutical firm in Chile, was the first strategic partner in local firm Domesco and was assisting the Vietnamese company in research and development, technology transfer, businesses consultancy, and supply chain management before securing a controlling stake in it.

A staff works in a lab of DHG Pharmaceutical Jsc in southern Vietnam. Photo courtesy of the company.

Ly Thi Hien, the lead analyst at Yuanta Vietnam, said the pharmaceutical industry is one that requires years of investment to build up a brand and acquire a decent market share. Domestic firms with relatively shallow pockets find it difficult to spend money on researching and developing new medicines, creating an opening for foreign firms.

To develop further, domestic firms need to take advantage of the exclusive formulas and scientific achievements of foreign pharma giants, she added.

Industry insiders say that partnerships with foreign companies have brought both short-term and long-term benefits.

Le Xuan Thang, CEO of Hataphar, said that establishing a partnership with ASKA meant that the company has VND370 billion to build a new factory. It also receives consultancy services from the Japanese company on building that factory with advanced technology.

Meanwhile, DHG, thanks to its partnership with Japan’s Taisho, was able to acquire international certification in less than two years for its effervescent tablet production chain and another Japanese certificate for its antibiotics chain.

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