How is Vietnam Pharmacy Retail Market Positioned?
Vietnam is one of the fastest growing pharmaceutical markets in South East Asia. The pharmacy retail market, although having presence of pharmacy chains since many years, gained momentum particularly in the last decade with entry of new players and growing healthcare expenditure and health & wellness awareness. Various social and economic factors have contributed to the growth of the industry. Vietnam has been experiencing a fast growing proportion of aging population. The proportion of population above 65 years of age has increased from ~% in 2015 to ~% in 2018 and is expected to triple to ~% by 2050, leading to higher demand for maintenance medicines in the country. The per capita drug expenditure in the country has also increased from USD ~ in 2014 to USD ~ in 2019.
In 2019, there were ~ pharmacies in Vietnam including drugstores, hospital dispensaries and drug cabinets of commune health stations. The number of pharmacies increased at a CAGR of ~% over the review period 2014-2019. On the basis of revenue, the industry grew from USD ~ billion in 2014 and crossed USD ~ billion in 2019, witnessing a CAGR of ~%. The medicine retail channel through pharmacies accounts for approximately ~% of the total pharmaceutical market in 2019. In the recent years, the industry has witnessed a growth of modern pharmacy chains. Most pharmacy chains in Vietnam are currently focusing on the southern region, particularly Ho Chi Minh and neighboring provinces. These pharmacies offer a wide portfolio of products ranging from Pharma to FMCG.
Vietnam Pharmacy Retail Market Segmentation
By Market Structure: The presence of Organized Pharmacies is low in Vietnam in comparison as these chains have recently started expanding. The unorganized market dominated both in the number of stores and revenues as of 2020.
By Region: Vietnam can be classified into three regions namely northern, southern and central. The southern region, particularly Ho Chi Minh & neighboring provinces, accounts for the highest number of pharmacies as well as industry revenue due to concentration of pharmacy chains as well population. The remaining revenue is contributed by the northern & central regions.
By Type of Product Category: Prescribed Medicines contributed the maximum revenue share in the total market in 2020. Organized Pharmacies are however starting to focus on Non-Pharma Products as well due to higher margins and in order to expand their product portfolio.
By Type of Drug: Generic Drugs accounted for maximum industry revenue in Vietnam in 2020. Generics are easily available and mostly prescribed by the doctors as well since majority of the people belong to low/medium income groups. The domestic drug manufacturers are also focusing on production of generics.
By Location of Pharmacy: Majority of the pharmacy stores in Vietnam were observed to be located outside hospital premises in busy streets, malls, shopping complexes, etc. A small proportion of the pharmacies are located inside hospital premises.
By Therapeutic Areas: Drugs for cardiovascular diseases were most sold in pharmacies across Vietnam in 2020. Anti-diabetic, pain relief/analgesics, anti-infective & respiratory drugs were also largely demanded. NCDs accounted for ~% of the total deaths in Vietnam in 2018 and are leading higher drug sales across various therapeutic classes.
Major Trends and Growth Drivers in Vietnam Pharmacy Retail Market
Rising Per Capita Drug Expenditure: Due to rising health awareness and prevalence of communicable & non-communicable diseases, the per capita expenditure on medicines is also consistently increasing. The per capita drug spending increased a CAGR of ~% over the period 2014-2019, from $ ~ in 2014 to $ ~ in 2019.
Health Insurance Coverage: The number of total population participating in the national insurance program reached ~ million, accounting for ~% of the population in 2018. The coverage is further expected to increase to ~% of the total population by the end of 2020.
Rising Cases of NCDs: Non-communicable cases are consistently rising in Vietnam particularly cardiovascular diseases, cancers, pre-natal & maternal conditions, chronic respiratory diseases, diabetes & more. NCDs accounted for ~% of the total deaths & ~% of the total cases in Vietnam in 2018.
Aging Population: Vietnam is one of the countries with the fastest aging population in South East Asia. The proportion of population above 60 years of age reached ~% in 2018, while the proportion of population above 80 years reached ~%. The median age in the country is also expected to increase from ~ years in 2017 to ~ years by 2050, thus highlighting the growth of aging population in the nation.
Competition Scenario in the Vietnam Pharmacy Market
The Vietnam Pharmacy Retail Market has a presence of ~ pharmacies as of 2019. The market has a mix of chain and independent pharmacies with majority of pharmacies being independent or standalone. Organized pharmacies together accounted for ~% of the industry revenue in 2019. The top five pharmacy chains on the basis of number of stores are Pharmacity, Long Chau, Guardian, Medicare and Phano Pharmacy as of November 2020. The competition in market is highly fragmented, with pharmacy chains accounting for a very small percentage of the total industry revenue as well as total number of stores. The organized chains are trying to establish a strong presence in the market by rapidly expanding their store network, offering various services such as integrating stores with latest technologies for better in-store experience, membership programs & loyalty schemes, special promotion offers and discounts, delivery services and more.
Vietnam Pharmacy Retail Market Future Outlook and Projections
The pharmacy retail market in Vietnam is expected to reach at a value of USD ~ Billion by 2025 registering a CAGR of ~% during the forecast period of 2019-2025. The outbreak of Covid-19 pandemic stimulated the shift of customers towards preventive healthcare & over-the-counter products and growing the consumption for vitamins, dietary supplements and functional foods. Other factors as ageing population, rapid store expansion of organized pharmacies, increase in per capita drug expenditure and rising adoption of e-pharmacies is expected to drive the growth of the industry.
Vietnam Pharmacy Retail Market (Basis Revenue and Number of Pharmacies):-
Vietnam Pharmacy Retail Market Segmentations (On the basis of Sales Volume)
By Market Structure (On the basis of Revenue and Number of Pharmacies)
By Product Category (On the basis of Revenue)
By Region (On the basis of Revenue & Number of Pharmacies)
By Therapeutic Areas (On the basis of Revenue)
By Drug Type (On the basis of Revenue)
By Location (On the basis of Number of Pharmacies)
Pharmacy Retail Chains Covered:-
SK Plus Pharmacy
Key Target Audience:-
Pharmaceutical Manufacturing Companies
Pharmacy Retail Companies
Government and Regulatory Bodies
Pharmaceutical Distributors & Wholesalers
Time Period Captured in the Report:-
Historical Period: 2014-2019
Forecast Period: 2020-2025
Key Topics Covered in the Report:-
Overview and Genesis of Vietnam Pharmacy Retail Industry
Vietnam Demographics, Healthcare Overview & Health Statistics
Usage of Contraception & Family Planning Practices in Vietnam
Health Insurance Scenario
Trends and Growth Drivers in the Industry and Challenges Faced
Vietnam Pharmacy Retail Market Size and Segmentations, 2014-2019
Telemedicine & Growth of Hybrid Pharmacies
Customer Decision Making Parameters & Brand Perception Mapping
Industry SWOT Analysis and BCG Matrix
Cross Comparisons between Pharmacy Retail Chains and Company Profiles
Future Market Size and Segmentations, 2020-2025F
Covid-19 Impact on the Industry, Future Trends & the Way Forward
For More Information on the research report, refer to below link:-
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Ankur Gupta, Head Marketing & Communications