### The Rising Dynamics of Vietnam’s Pharmaceutical Sector
Vietnam’s pharmaceutical industry is undergoing a transformative journey, bolstered by the influx of foreign strategic investors. These investors bring not only robust financial resources but also advanced technological expertise, allowing local companies to enhance their competitiveness and expand their export markets significantly. This evolution positions Vietnam as a burgeoning player in the global healthcare arena.
### A Forecasted Boom in Mergers and Acquisitions
According to PwC’s report, “Global M&A Industry Trends: 2025 Outlook,” the momentum of mergers and acquisitions (M&A) is palpable. An impressive 81% of CEOs who have participated in M&A activities over the past three years intend to pursue further deals within the next three years. The healthcare and pharmaceutical sectors are particularly active, engaging in M&A to reshape their business models in response to changing market dynamics.
PwC Vietnam anticipates a vibrant M&A market in the healthcare sector by 2025, driven by increasing demand for superior medical services coupled with a burgeoning middle class. Notably, pharmaceutical firms, private hospitals, and specialized medical entities—especially in ophthalmology and oncology—are expected to be prime targets in this M&A wave.
### The Financial Landscape Supporting Growth
As noted by Ong Tiong Hooi, Partner and Transaction Services Leader at PwC Vietnam, global M&A activities exhibit a robust recovery, spurred by positive economic indicators and an upsurge in strategic mergers. This trend is equally visible within Vietnam, where domestic players are becoming more assertive, leading high-value transactions while foreign investors show renewed interest in healthcare and education.
### Foreign Investment: Accelerating Acquisitions
The recent surge in M&A deals within Vietnam’s healthcare sector reflects an exciting boom. Data from Kirin Capital indicates that healthcare emerged as the most active sector for M&A in 2023, with 11 transactions amounting to a remarkable $508 million. This positions it as the third most active sector overall, trailing only finance and real estate, largely driven by foreign investors.
Prominent transactions include the acquisition of FV Hospital by Thomson Medical Group and Dongwha Pharm’s purchase of a controlling stake in the Trung Sơn pharmacy chain. These moves signify not only foreign interest but also an acknowledgment of the promising potential of Vietnamese healthcare.
### Strategic Investments That Matter
In March, Mekong Enterprise Fund IV, managed by Mekong Capital, ventured into private healthcare for the first time by investing in TNH Hospital Group JSC, a leading entity in Vietnam’s northern midland and mountainous region. Chris Freund, CEO of Mekong Capital, expressed his satisfaction in finally pinpointing an investment opportunity after years of exploration, highlighting TNH’s visionary leadership as a key factor.
Recent months have seen significant foreign investments in TNH, with Singapore-based Blooming Earth acquiring over 6.72 million shares, elevating its ownership stake to 13.74%. Additionally, Access S.A., SICAV-SIF—Asia Top Picks, based in Luxembourg, has also made strategic purchases, raising its stake to 8.05%.
### The Growing Appeal of Vietnam’s Drug Manufacturers
Binh Dinh Pharmaceutical and Medical Equipment JSC has caught the eye of several foreign investors as well. In December 2024, Swiss-based KWE Beteiligungen AG increased its stake from 9.93% to 10.01%, becoming the second-largest shareholder in the company. Notably, this fund also holds a significant position in TNH, reinforcing the interconnectedness of foreign investments in Vietnam’s healthcare landscape.
Leading local pharmaceutical firms such as Hau Giang Pharma, Domesco, Traphaco, and Pymepharco have all attracted foreign strategic shareholders, with several foreign entities attaining controlling stakes that exceed 51%. Some have even successfully completed full acquisitions, illustrating the growing confidence in Vietnam’s healthcare capabilities.
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In summary, Vietnam’s pharmaceutical sector stands on the cusp of substantial growth, fueled by strategic foreign investments and M&A activities. As demand for high-quality medical services rises, the landscape is set for exciting developments that could reshape the healthcare delivery system in Vietnam. The interplay of local innovation and global expertise presents a unique opportunity to elevate Vietnam’s position in the global healthcare market.