► The drug distribution business nearly 9 times greater than the drug manufacturers ..
Drug distribution system in Vietnam market is quite complex, many intermediary steps and difficult to control
Drug prices continued to rise unreasonably, imported drugs accounted for most of the market share, distribution systems overlap ... create a monopoly, market manipulation by a group of pharmaceutical companies making drugs exchange risk "swallow" the drug is in existence.
According to the Pharmaceutical Business Association Vietnam announced at the workshop "Healthy competition in the pharmaceutical sector: The experience of Japan" by the Competition Administration Department (Ministry of Industry and Trade), the country has approximately 39,000 retail locations and approximately 2,357 pharmaceutical enterprises registered pharmaceutical business functions while only 276 producers.
Thus, the drug distribution business nearly 9 times greater than the drug manufacturers.
Regarding market structure, Tran Phuong Lan, Head of Monitoring and Management Competition, Competition Management Department, said the top 10 enterprises producing mainly state-owned enterprises, led by Pharmaceutical Company Hau Giang, but also not too large market share (10.79%), and other top business leader with market share just under 10%.
Recently, the pharmaceutical market has been approximately 50% meet the needs of people who use drugs Vietnam and the remaining 50% of imports, especially brand name drugs, specialty products, as Vietnam has be made, not to mention imported input materials and active ingredients for the production of drugs. Thus, the drug is imported huge distribution Vietnam drug market.
Drug distribution system in Vietnam market is quite complex, many intermediary steps and difficult to control.
According to the Competition Administration Department, 10 leading enterprises import a high share of drugs, such as Pharmaceuticals Corporation Central 2 up 12.09%; Zuellig Pharma Co., Ltd. Vietnam accounted for 10, 09% market share ... However, in a competitive environment such pretty fierce, drug prices have soared.
Furthermore, according to current regulations, foreign companies are not involved in drug distribution Vietnam may nevertheless form the legal risk through M & A (merger and sale).
The logistics company providing multinational though not authorized pharmaceutical distributor, but was involved in almost every stage of the distribution process of many pharmaceutical products manufacturers overseas. The involvement of the drug distribution business overseas is also a factor in drug price manipulation in Vietnam.
Ms. Tran Phuong Lan analysis, prices phenomena hardly unusual in drug products produced domestically but reappears in the imported drug products, especially the kind of specific drugs. here has agreed to appear in the vertical and horizontal distribution of pharmaceutical products, which is the link between the agreement and the manufacturer to the distributor.
The cause of this problem is by pharmaceuticals is a very special product, each drug has a different market and very low substitutability. Meanwhile, consumers in the passive voice, totally dependent on the doctor's prescription, there is no complete information about the product.
According to the Vietnam Business Association, the percentage% of drug production in the country is very low, especially in the central hospitals and provincial levels, respectively, 11.9% and 33.9%. The monopoly is one of the causes of rising drug prices.
Also in Poland, the legal framework for the competitive behavior was quite adequate and comprehensive, with high consistency, however sometimes not specific, creating gaps. Therefore, additional specific provisions for determining drug distribution system, additional controls on vertical agreements and expand the scope of the Competition Law: covers activities taking place outside the territory of Vietnam, but the impact on competition within the territory of Vietnam.
With the state management agencies, to strengthen the role of active surveillance in the market competition. Enhanced control of vertical agreements and economic concentration transaction to prevent the takeover of foreign firms to domestic firms only for the purpose of direct participation and legitimate distribution system drugs.
Businesses operating in the pharmaceutical sector to enhance legal awareness to not inadvertently violate the Competition Law as well as to protect the legitimate rights and interests of his. Also, keep in mind these are not included in the contract provisions, terms and conditions may lead to agreements restricting competition.
Sharing experiences from Japan, Osamu Igarashi, CTA's Project Cooperation with JFTC Competition Administration Department that wants to remove the links, it is necessary to assert the company has foreign elements can not distribution.
Therefore not be allowed to organize or participate in the distribution process. Prescribing should be applied according to the substance but avoid foreign firms vertical integration, delivering the product only for the exclusive distribution abroad and avoid creating horizontal links (using the same classification system distribution).
On the other hand, the role of the company is the only foreign elements providing logistics as customs declaration, warehousing and transportation ... Not for any company that owns a large number of retail pharmacies.
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