vietnam healthcare-market-overview-webinar-presentation (1)
TRANSCRIPT
Vietnam Healthcare Market Overview
10 December 2015
Australia Unlimited
Today’s webinar agenda
Introduction of speakers
The shift in ASEAN market – AEC & TPP impact
Vietnam healthcare market overview
Outline opportunities in hospital sector
Introduction to Medical Science & Health Services Mission to
Vietnam – July 2016
Q & A
2
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Introduction
Ms Janelle Casey – Senior Trade Commissioner, Austrade
Vietnam
Mr Dong Pham – Vice Chairman, Vietnam Private Hospital
Association
Ms Minh Cao – Business Development Manager, Austrade
Vietnam
Ms Milena Bliss – Senior Trade Adviser – International Health,
Sydney Australia
3
Why Vietnam
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Vietnam – the next growing healthcare market
in ASEAN
5
Large population, rapid urbanization & increasing
spending power
Increasing demands for quality healthcare
Strong economic growth
Increasing healthcare expenditure
Next growing medical devices/ pharmaceuticals
manufacturing industry
Global shift in ASEAN markets
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The shift in ASIAN market: impacts from AEC & TPP
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Opportunities in Vietnam
Import of services for physicians
Next in production of and R&D pharmaceutical and medical devices
Manufacturing base for medical devices
AEC OBJECTIVES
Free flow of Goods
Free Flow of
Services
Free Flow of Investment
Free Flow of Capital
Free flow of skilled
labor
AEC impacts to healthcare industry
7
Source: BMI, Frost & Sullivan
Harmonised requirements
for inter-ASEAN licensing &
permits for practice
Removed or lowered tariff /
tax rates
Expansion & exporting of
services such as medical &
technical expertise
Expansion of
pharmaceutical & medical
device manufacturers &
distributors
Easier medical business
expansion & transfer of
capital
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TPP Outcomes for Australia in the health sector
8
Elimination of duties
Greater access & operating conditions
Improve competition level of Australian
pharmaceutical & medical devices
manufacturers
Ability to participate in tenders for
government procurement contracts
For further information, visit www.dfat.gov.au/fta/tpp/
SINGAPORE
MEXICO
TPP Parties
JAPAN
VIETNAM
MALAYSIA
BRUNEI
AUSTRALIA
CANADA
USA
PERUCHILE
VIETNAM HEALTHCARE
MARKET
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Year 2014
Vietnam – the next healthcare market in ASEAN
Total healthcare spending
90% Medical devices are imported
Hospitals
Year 2020e
91million 97million
Large & fast growing Population
33.6% 36.9%
URBAN RATE19.5%
24.9%
4.9%
5.2%
13.3%
32.3%
Consumables
Diagnostic Imaging
Dental products
Orthopedics &prosthetics
Patient aids
Others
22.3%
25.4%
5.0%
5.9%
12.0%
29.3%
US$13billion
Year 2015
Year 2015 Year 2020e
Year 2015 Year 2020e
Growing at 13.4%
Growing at 1.05%
Year 2014 Year 2020e
1,090 1,204
200175
Public
Private
7.9 Doctors per 10,000 habitants
25.1 Hospital beds per 10,000
habitants
10
US$24billion
Pharmaceuticals market value
US$3.8billion
US$7.3billion
Growing at 14.1%
Year 2014 Year 2019e
5.8% GDP – highest in ASEAN
4th largest in ASEAN
14th largest in the world
Source: BMI, Frost & Sullivan, World Bank
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Where we see opportunities
11
Tele-health/ Tele-
medicine
Hospital management &
patient administration
systems
Electronic health record
Research excellence in
medical products,
technologies,
Robust regulatory
regime
Sophisticated
domestic
pharmaceutical &
health care system
Global leader in medical science & technologies: breakthrough products.
Extensive research
expertise in developing
new therapeutics for
tropical diseases
A global hub for medical research
Underdeveloped healthcare system
PPP projects
Healthcare
infrastructure
Technology transfer
projects
Drugs & vaccines
development /
R&D
Emergency
response
Diseases
management
Human
resources
Health IT
system
Hospitals &
clinic
management
Education
& training
NICHE medical & surgical equipment & devices
General hospital
supplies, laboratory
equipment
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Vision to turn Vietnam into a pharmaceuticals
production hub in the region
To have 80% of domestic demand met by local producers by
2020, up from ~ 50% currently
Focus on drugs, vaccines, blood and other biologics products
Calling investment from both domestic and foreign
organizations
Plans to invest US$241 million in eight projects within the local
drug manufacturing industry
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Pharmaceutical sector – risky but promising
13
Top countries for imported
pharmaceuticals in Vietnam - 2012
80% of pharmaceutical
are imported
Top quality drugs are
mainly produced by
foreign players Legislation
mandates using a local partner for importing &
product registration
Government focuses on
the production of generic
pharmaceuticals
Highly-fragmented distribution
Large market size Joint
partnerships will provide
quicker market access
Tender regulations favor local
manufacturers
Increasing regulation & compliance level
Low market entry barriers & Self-medicating culture
Universal Health Coverage drives the needs for production of generic pharmaceuticals
National drive to produce high-quality pharmaceuticals
Key drivers and trends
FRANCE1th
2nd INDIA
US$ 235.9 mil
US$ 230.5 mil
3rd SOUTH
KOREAUS$ 164.4 mil
4th GERMANY US$ 143.4 mil
5th ITALY US$ 93.9 mil
Increasing use of health supplements
Increase in the use of modern, self-medication & traditional medicine to self-diagnose
Increasing competition between foreign & domestic companies
Increasing local support for domestic products
Source: BMI, Frost & Sullivan
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Medical technology sector - fragmented
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Fragmented Distribution
Availability of many
diversified products
Multiple stakeholders for decision
making
Relationship-driven
business
High focus & resources required to sell medical
devices
Limited exclusive
distributors
Small family-run
businesses
Distribution channels
Regional
Segmentation
Regional Provincial
Product/ Operational Segmentation
DistributorsImporters & Distributors
4th party logistics companies
National
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… but poised for growth and change
15
ASEAN Economic Community &ASEAN Medical Device Directive
Government vision to become a regional pharmaceutical generics production base by 2020
Increasing investment in hospital sector from both domestic & international investors
Biotech will assist the development of vaccines, higher-quality pharmaceuticals, gene therapy, and IVF technology
Increasing activities of telemedicine in consultation, surgery, imaging, and cardiology
Increase in in-vitro diagnostics and imaging equipment
Key drivers and trends
90% of medical
devices are imported
Attractive manufacturing
base
Largely focused on
low-end medical
consumables
Low manufacturing
costsMed Tech is in its early stage
of manufacturing
Low market entry
barriers
Growing demand for high quality
health services
Hospital sector
Mr The Dong Pham
Vice Chairman
Vietnam Private Hospital Association
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Developing public hospital sector is a priority
Market drivers
Healthcare expenditure is ~ 6% of GDP, highest in ASEAN region
Financial resources from WHO to develop
healthcare infrastructure
Government reducing barriers to new
hospital set-ups
2011–2015 eHealth Plan to improve health
IT applications
Aging society with decreasing birth rates
Collaboration between local manufacturers and
foreign companies for local generics or low-
end medical devices
Collaboration with distributors for joint ventures
to move the distributor up the value chain
Expansion or joint ventures in both urban and rural
areas; data warehousing to increase efficiency &
data tracking between vendors and hospitals
Systems adoption to link up private and
public hospital information systems.
Aged care services or IVF specialty clinics or
products.
Opportunities
17
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While private hospital sector continues to grow
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Growing sector due to
overcrowding issue in public
hospitals
Increasing IT infrastructure development
Demand for private,
affordable healthcare services
Autonomy to purchase
directly from distributors as Tender is not
required
Government tax incentive
for new healthcare
service facilities
Low occupancy
rates at some hospitals can
lead to closure
High demands for training in
hospital management
Collaboration with public &
private hospitals for specialised
services
Opportunities for aged care services to support the
aging population
Forecasted CAGR of
13.4% to 2020
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Via foreign investments & privatisation process
The Decree 93/NQ-CP on “Some
mechanisms and policies to develop health
care” - approved on 15 December 2014,
facilitates cooperation between public
and private health care sectors
Public hospital privatisation in Vietnam: 1st
privatisation of public hospital:The
Vietnam Central Transportation Hospital,
The cooperation between City
International Hospital and Cho Ray
Hospital
Foreign medical suppliers are able to
provide services via
100% foreign-invested hospitals
JV with Vietnamese partners
Business cooperation contracts with
local medical service providers
PPP agreements allow doctors to work in
both public and private healthcare facilities
JV example
Canadian Triple Eye Infrastructure
Corp & Dai An JSC Co.
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PPP & Hospital privatisation Foreign Investment
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PPP projects in hospital infrastructure
development
Project Location Investment
capital (US$)
Investment
model
Project
Governance
1 Obstetrics –
paediatrics hospital
Binh Dinh 24 mil PPP Binh Dinh
Department of
Planning and
Investment
2 Ha Tinh obstetrics –
paediatrics hospital
Ha Tinh 17 mil PPP Ha Tinh
Department of
Planning and
Investment
3 International general
hospital
Gia Lam,
Hanoi
200 mil PPP Ha Noi
Department of
Planning and
Investment
4 Phu Xuyen General
Hospital
Phu Xuyen,
Hanoi
161 mil PPP Ha Noi
Department of
Planning and
Investment
20
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SAIGON ITO HOSPITAL GROUP
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Demands for
healthcare in
Vietnam are unmet
Long-term potentials in
medical technology
market
• Driven by the national initiative for
local drugs & medical devices
manufacturing
• AEC & TPP in place
• Strong foreign investment
Vietnam may become the
generic drugs manufacturing
hub in the region
• Government focus sector
• Low-cost production & competitive
environment
• Lower business boundaries due to AEC &
TPP
Vietnam – a market full of potentials
• Hospitals overcrowding
• Under-served rural population
• Poor adoption of technology
• High-quality drugs are mainly
imported
22
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Medical science & health services mission to Vietnam
23
Led by Professor Ian
Frazer
Opportunities to
showcase
• Products
• Equipment
• Technology
• Systems
• Services, education and
research
Obtain market insights,
first-hand market
understanding
Increase brand awareness
Chances to establish
connections with
• Industry key stakeholders
• Potential customers,
distributors and partners
• Key market players
• Education and training
institutions Site visits, business
matching activities, net
working functions,
research workshop
Leverage the Australian
government badge
Hanoi & Ho Chi Minh City
18th to 22th July 2016
Develop business &
collaboration opportunities
CONTACT AUSTRADE
In Australia: 13 28 78
In Vietnam: +84 8 3827 0600
www.austrade.gov.au/Vietnam
www.exportawards.gov.au
www.australiaunlimited.com
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