Indian companies eye Vietnam to set up a $500-million pharma hub

Large Indian pharma enterprises are looking into the possibility of setting up a pharmaceutical hub in Vietnam to benefit from the country’s shift to becoming a middle-income nation and its fast-aging population in need for drug supply.

The idea of setting up the pharmaceutical industrial park was launched during recent trade and investment promotion sessions for the pharmaceutical industry organised by the Vietnamese Embassy in India, according to the local Vietnam Trade Office.

The companies said they would earmark an initial investment of about $500 million for the project, should it materialize.

It is estimated that such an industrial park would create jobs for 50,000 direct and 200,000 indirect workers and export revenue of about $5 billion per year. It would also help Vietnam reduce dependence on traditional pharmaceutical supplies and diversify its production chains.

Vietnam could become a leading pharma development and production base in the region

Leaders of localities in Da Nang and Thua Thien-Hue in central Vietnam, Long An in southern Vietnam, as well as Hai Duong, Bac Ninh and Thai Nguyen in the north have  already discussed land rent, geographical location, transport infrastructure and potential investment incentives with Indian investors.

Ramesh Babu, chairman of India-based pharmaceutical manufacturing company SMS Pharmaceutical Group, which plans to invest in the pharmaceutical industrial park in Vietnam, said if successful, it would turn the country into a ”leading pharmaceutical research, development and production base in Southeast Asia.”

Besides India, international drug makers are increasingly assessing the potential of the Vietnamese pharma market. Lately, the European Chamber of Commerce in Vietnam has highly valued the potential of the country to become a center for the research-based pharmaceutical industry in terms of production, export and supplies of high-quality healthcare services in the region.