Abbott product distribution faces monopoly queries

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The move came after the committee reported that US-based Abbott Laboratories and its exclusive Vietnamese distributor 3A Nutrition Vietnam Co., Ltd appeared to be monopolising the distribution of the vanilla-flavoured Ensure original shake into Vietnam.

Committee deputy director Dinh Tien Dung pointed out in a document at the beginning of 2013 that Abbott Laboratories had started printing on the label of the vanilla-flavoured Ensure shake that the product was “not to be sold in Vietnam or Mexico”.

After Vietnamese authorities stopped allowing the import of this kind of product into Vietnam, the import of a similar product by Abbott’s exclusive Vietnamese distributor 3A Nutrition Vietnam Co., Ltd. increased 63 per cent. The price of the drink is almost twice the original product that was withdrawn from distribution in Vietnam.

In order to sell the drink in the Vietnamese market, a number of companies have taken advantage of loopholes in regulations on product quality certification to produce fake documents for the free distribution of the product.However, in August 2014, the Ministry of Health did not allow the certification of the product labelled with “not to be sold in Vietnam or Mexico”, meaning that firms were not allowed to import the product into Vietnam. After that, the smuggling of the product has become more serious.

In 2013 the import value of the nutrition drink reached VND700 billion ($33 million), of which 3A Nutrition imported VND300 billion ($14 million) worth.

The committee has asked the Ministry of Health to work with Abbott to clarify the quality of the original vanilla-flavoured Ensure shake and discuss whether there were health issues associated with the product labeled for non-Vietnamese distribution.

The committee claimed Abbott Laboratories should abolish the labelling of the product “not to be sold in Vietnam or Mexico” in case the product was freely distributed in the original country and safe to consumers.

The committee also asked the ministry of adjust regulations to help other companies to import this product in order to prevent the monopoly in distribution of the product that will affect the rights of Vietnamese consumers.

Head of Public Affairs at Abbott Laboratories, Thai Vuong Do shared VIR that “we recently took the decision to label certain Ensure liquid products in order to ensure the benefit and safety of Vietnamese consumers’.

He explained that “Our nutritional products are manufactured to world class standards and we take significant steps throughout the entire supply chain, from sourcing the highest quality ingredients to product transportation and storage, in order to guarantee the integrity and safety of our products. Our transportation and distribution partners are carefully selected, and regularly audited, to ensure they maintain the rigourous standards required by Abbott and expected by consumers.

Abbott previously accused a Vietnamese firm of using false documents to import the company’s milk products in a letter to the Ministry of Industry and Trade in 2013, pointing out that Ho Chi Minh City’s Song Nam Investment and Development had produced false documents to allow them to register imports and sell Abbott’s Ensure products throughout the country.

The letter to the ministry read in part “The forged document was a confirmation from East West Trading Partners that Song Nam was an authorised distributor for Abbott’s Ensure products in Vietnam and this is fraudulent.”

It continued “East West Trading Partners have no business relationship with Abbott Laboratories and is therefore in no position to grant any rights from the company to Song Nam.”

Vietnam Ministry of Industry and Trade’s survey also showed that imported milk prices in Vietnam are higher (from 20-150 per cent) than in other markets. Specifically, the import price of Abbott’s Ensure Gold in Vietnam (20-30 per cent higher compared to Thailand).

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