VietNamNet Bridge - Drug distributors have been expanding their networks by opening new drugstores and taking over other chains. 

Recently, the Vista drug store on Hai Ba Trung street did not have popular drugs available for some customers on one evening. According to the manager, the company is in a hand-over process. The manager is one of hundreds of workers who passed an exam to obtain a job in the Vista chain after Century Healthcare, Indonesia’s biggest healthcare product distributor, took over Vista.

Century is a pioneer in the Vietnamese market, but it is not the only foreign drug distribution chain to enter Vietnam. An analyst predicted that the number of drug chains will be increasing rapidly as the market has become attractive enough for investors. 

He said that once the market becomes professional, it will attract giants such as Aeon, which owns more than 4,000 drugstores in many markets; Walgreens Boot Alliance with 13,000 stores in 11 countries; and CVS with 7,000 stores.

The number of drug chains will be increasing rapidly as the market has become attractive enough for investors.

Sources said The Gioi Di Dong, a mobile phone distribution chain, is also eyeing a drug chain Pharmacity, while FPT Shop is eyeing Long Chau. 

The Gioi Di Dong hopes the deal can be wrapped up in 2017 and is moving ahead with an ambitious plan to open 800 drugstores. 

Phano is believed to be the largest drug store chain now with 80 stores and advantages in cooperating with large manufacturers. Unlike other chains whose stores are mostly located in HCMC, Phano is present in more than 10 cities/provinces. It has kicked off the 3P franchise model (professionalism, profit, protection) in a plan to be at the leading position in the drug retail market.

Meanwhile, Pharmacity opened the 78th store in HCMC, a part of its plan to open 200 stores by 2020. Pharmacy is located at Petrolimex-run filling stations and family doctors’ clinics.

There are many other well-known drugstore chains, namely Phuc An Khang, Sapharco and My Chau. Sapharco has over 30 retail and wholesale branches, while Phuc An Khang has 20 stores. Eco Pharmacy follows anorganization model similar to Phano’s, but it has smaller scale with 20 stores, mostly located near large hospitals in HCMC.

Analysts said that the drug retail chains formed nearly 10 years ago, but they have changed very slowly. There are over 50,000 separate drugstores all over the country, while the number of modern drug retail chains remains small. No drug chain has more than 100 stores.

BMI estimated that the Vietnamese drug market value was $4.7 billion in 2016, while the revenue from retail accounted for one-third of the total.

Meanwhile, IMS Health predicted that the market value would reach $10 billion by 2020.

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