Private healthcare boosts its presence

April 05, 2024 | 15:01
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Together with expansion plans among foreign-invested enterprises, emerging private players are boosting their presence in the promising local healthcare market.
Private healthcare boosts its presence
The private medical system has improved with funding in resources, facilities, and people, photo Le Toan

Vietlife Group on March 18 marked a new milestone in its operation when it opened a new clinic in Hanoi, thus increasing its number of facilities to five.

“The new facility is part of our effort to bring the best possible healthcare services to the locals. We will expand our operation in the future,” said Nguyen Anh Van, chairwoman of Vietlife.

In 2023, Vietlife continued its development journey with the ground-breaking of Vietlife International Hospital with a scale of 300 beds, reaching 5-star international standards. It is expected to open in mid-2025.

The company also opened two more clinics in Hanoi and Ho Chi Minh City during the year, increasing its total number of MRI machines to seven, ranking first in the number of MRI machines in the private clinic system in Vietnam.

Like Vietlife, other private-owned players are making more efforts in the race. Also in March, Phuong Chau Healthcare Group opened Phuong Nam Hospital, making it the fourth facility, providing international standard medical care services. The new 120-bed hospital has nine floors, built over ​​more than 20,000sq.m.

Nguyen Thi Ngoc Ho, general director of Phuong Chau Healthcare Group, said, “We have more than 13 years of experience and a strong team when moving to Ho Chi Minh City. The system’s three other hospitals in the Mekong Delta provinces of Can Tho, Soc Trang and Dong Thap have welcomed more than 33,000 healthy newborn babies, of which nearly 4,000 babies were born from assisted reproductive techniques and infertility treatment with a clinical pregnancy success rate of up to 66.6 per cent.”

To bring medical advancements to the locals, Phuong Chau now partners with Japanese medical group Kishokai. It is planning to boost cooperation to strongly develop in the future. It visions to lead and pioneer in creating outstanding advances in comprehensive reproductive healthcare in Vietnam.

According to the Vietnam Private Hospital Association, in recent years, the private medical system has grown strongly with investment in resources, facilities, equipment, people, and specialised techniques, attracting a large number of patients.

Dr. Tang Chi Thuong, director of Ho Chi Minh City Department of Health, said that at present, the city is home to more than 65 private hospitals housing nearly 4,700 beds, accounting for 12 per cent of the total in Vietnam. “The number of hospital beds in the private healthcare system needs to continue to increase because in developed countries, the number of private-run hospital beds accounts for 40-50 per cent of the total,” he said.

Other names in the south include Hanh Phuc International Hospital and City International Hospital, among others. In the north, Thu Cuc, Tam Anh, and Hong Ngoc are becoming popular. In the central region, Quang Khoi General Hospital and Hop Luc Group are growing.

“To build a standardised healthcare ecosystem, we are building an international-standard hospital and expected to put it into operation in 2025,” said Nguyen Van Khoi, chairman of Quang Khoi General Hospital. “We will continue to make investments in modernising facilities in the months to come.”

Hop Luc Group now operates two hospitals in the north-central province of Thanh Hoa, and is waiting for procedure approval to build an international Children’s Hospital there.

According to medical experts, together with the moves by local private players, the trend of pumping money via mergers and acquisitions among international groups and investment funds is heating up the market not only in products, services or customers, but also competing in the workforce and high-quality personnel.

For instance, last year saw Thomson Medical Group spend $381.4 million buying FV Hospital in 2023; while Singapore billionaire Raffles Medical Group acquired American International Hospital; and Dongwha Pharm Group (South Korea) bought the Trung Son Pharmaceutical chain.

Elsewhere, foreign-backed enterprises in the pharma industry are eying more opportunities. Daiichi Sankyo Vietnam and multinational corporations like Novartis, Sanofi, GSK, Pfizer, MSD, and others are seeking more enabling policies to bring more new innovative medicines and vaccines to the local market in 2024 and beyond.

“The signs into 2024 show that the level of competition tends to be fiercer as these enterprises continue to see the market as a lucrative piece of cake to jump, even though the international outlook remains extremely uncertain,” said Van of Vietlife.

Dr. Le Van Truyen, former Deputy Minister of Health

Private healthcare boosts its presence

The pharma market is forecast by 2026 to reach $16.1 billion, according to Business Monitor International. There are 228 factories meeting GMP-WHO standards, and many studies on medicinal herbs are applied to produce drugs and healthy foods. The domestic health protection food market has developed sharply in recent years.

However, domestically produced pharmaceuticals are not highly competitive compared to foreign-made ones. Research and development capacity in Vietnam is weak.

The goals are to have 80 per cent of drugs domestically-made by 2030, having invented drugs from endemic medicinal resources by 2045; and increasing contribution of the pharmaceutical industry to $20 billion to GDP. To do this, it is necessary to have the state’s prioritised policies to apply sci-tech and improve capacity to absorb new technology. We must also increase investment, improve international competitiveness, and participate in the value chain.

Trinh Van Lau, chairman, Vietnam Pharmaceutical Companies Association

Private healthcare boosts its presence

In recent times the state has focused on prioritising the development of the pharmaceutical industry and domestic production of ingredients with supporting policies support at a high level according to the laws.

It has also looked at attracting foreign investment in the production of brand-name drugs, specialised drugs, and drugs with high-tech dosage forms, as well as vaccines, medical biological products, and biosimilars.

However, the state needs to prioritise further investment in scientific research, production of new drugs, and have special policies to develop domestic sources of medicinal herbs, especially precious herbs with high economic value. It is also necessary to strengthen cooperation among scientists in research, application, tech transfer, and production of brand-name and patented drugs.

Currently, 95 per cent of active pharmaceutical ingredients and high-quality excipients used in the Vietnamese pharmaceutical industry must be imported, although there have been many projects synthesising active pharmaceutical compounds on a laboratory or pilot scale (the second phase in researching and developing new drug production processes) but there is no basis to deploy on an industrial scale.

There are also no clear regulations on public-private investment in scientific research and technology transfer.

Nguyen Van De, chairman, Vietnam Private Hospital Association

Private healthcare boosts its presence

The private hospital community is developing rapidly in scale and quality. Our member hospitals are planning to expand operations to contribute more to the healthcare sector’s development.

To date, the association has more than 2,500 members, including 250 hospitals, more than 2,000 private clinics and affiliated members operating in provinces and cities nationwide.

Epidemics not only threaten and reverse medical achievements, but also have a profound and comprehensive impact on all aspects of the economy and society. The pandemic also revealed many hidden problems of the health system.

Current practice shows that laws, decrees, and circulars guiding investment in the health sector still have many shortcomings and are inconsistent or confusing. The difference in understanding among localities makes it impossible for businesses and investors to access projects, especially initiatives in private hospitals.

We expect the government, the National Assembly, and the Ministry of Health to have solutions and continue reforming, innovating, and adjusting new development strategies, thus caring for and improving people’s health.

Increasing private investment in healthcare – A long journey ahead Increasing private investment in healthcare – A long journey ahead

The healthcare sector has yet to live up to expectations despite efforts to attract investment. Nguyen Thi Lien Huong, Deputy Minister of Health, talked with VIR’s Bich Thuy about the steps needed to make improvements.

By Bich Thuy

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