return icon

Pharmaceutical stocks benefit from disease spread

Pharmaceutical stocks are experiencing an upsurge as fears of coronavirus have boosted demand for healthcare products and services, lifting demand for shares.




Workers at DHG Pharmaceutical Company. The pharmaceutical industry is benefiting from the spread of coronavirus and witnessing stock prices rising sharply. — Photo



During the recent outbreak, the benchmark VN-Index fell by some 6.4 per cent, but the pharmaceutical industry is witnessing stock prices rising sharply.

This goes in reverse to last year’s situation, when pharmaceutical stocks were less concerned with low liquidity and stock prices moved sideways or decreased amid the sector’s slowing growth.

Shares of Hau Giang Pharmaceutical Joint Stock Company (DHG) reached its six-month high of VND102,600 (US$4.4) per share on Monday. Since the spread of the disease in early January, DHG has surged nearly 20 per cent.

The company, one of the largest pharmaceutical firms in Viet Nam manufacturing and selling over-the-counter (OTC) medicines, reported profit of VND631 billion in 2019, down 3 per cent year-on-year, mainly due to the four-year low recorded in the third quarter.

DHG did not complete last year’s business plan as it fulfilled only 99 per cent of the annual revenue plan and 95 per cent of the annual profit plan.

At the end of April last year, DHG became a subsidiary of Japan’s Taisho Pharmaceutical Co Ltd after the Japanese drug maker acquired an additional 20.6 million shares of DHG, lifting its stake to 50.78 per cent.

M&A is gradually becoming popular in the pharmaceutical industry. According to SSI Research, in May 2019, Kimia Pharma, an Indonesian state-owned pharmaceutical company, revealed that it was considering acquiring one of Viet Nam's leading pharmaceutical retail chains. Foreign pharmaceutical companies aim at M&A to take advantage of available resources, reducing costs and shortening the time to enter Viet Nam’s market.

Another OTC pharmaceutical producer, Traphaco JSC (TRA), reported a drop of 2.4 per cent in last year’s profit, to VND171 billion, completing the yearly plan. The company’s revenue reached VND1.7 trillion, equal to 92 per cent of the yearly target.

In contrast, businesses operating in the ethical or prescription drugs (ETC) channel, performed more efficiently last year.

Imexpharm Pharmaceutical (IMP) reported profit of VND162 billion, representing a record rise of 17.1 per cent year-on-year. Benefiting from the spread of the coronavirus, IMP shares hit its one-year peak of VND56,000 per share on Monday, up by 16 per cent since early January.

Pymepharco Pharmaceutical (PME) reported an increase of 4 per cent in profit and a rise of 10 per cent in revenue last year. The company fulfilled 97 per cent of the revenue plan and completed 100 per cent of the profit plan set for the year.

Regarding Viet Nam Pharmaceutical Corporation (DVN), revenue decreased by 4.3 per cent to VND5.7 trillion. Profit increased by 7.3 per cent to VND221 billion, mainly due to cost reduction.

According to FPT Securities (FPTS), the development of the ETC channel in 2019 was mostly thanks to the growth of the generic drug business.

A generic drug is a pharmaceutical drug that contains the same chemical substance as a drug that was originally protected by chemical patents. Generic drugs are allowed for sale after the patents on the original drugs expire.

They work the same as original medicines but is sold at lower prices because the drug manufacturer does not have to duplicate the original clinical trials for effectiveness and safety, which lowers the cost to bring the drug to market. Generics are not less expensive because they are lower in quality.

Another factor that promotes ETC growth is the increase in the percentage of people covered by insurance in Viet Nam, which rose from 28 per cent to 90 per cent between 2005 and 2019.

The consumption of drugs via ETC channel has also slowed because the list of active ingredients allowed to be circulated without prescription is reduced from 250 to 243 and the trading of antibiotics in retail has been tightened to minimise antibiotic resistance.

This year, SSI Research forecasts the pharmaceutical market will grow by 9-10 per cent thanks to population growth and increasing healthcare demand.

The growth motivation for the pharmaceutical industry also originates from rapid urbanisation, which promotes the development of the middle class as well as average income per capita.

According to the Viet Nam Drug Administration (DAV), the size of the pharmaceutical industry is forecast to reach $7.7 billion by 2021. — VNS

Foreign investors continue to target Vietnam’s pharmaceutical industry

Foreign investors continue to target Vietnam’s pharmaceutical industry

Vietnam's pharmaceutical market has a lot of potential coming from the demographics, rising income and priority policies of the government.

VN's pharmaceutical import turnover may reach $3 billion by end of year

VN's pharmaceutical import turnover may reach $3 billion by end of year

With the average pharmaceutical import turnover of $245 million per month, the figure of the whole year of 2019 may reach $3 billion, equaling 50 per cent of the whole scale of the market.  


Boeing accelerates cooperation with Vietnamese suppliers

Boeing, the world’s leading aerospace company based in the US, are accelerating cooperation with Vietnamese suppliers and universities to provide a foundation for long-term industrial growth.

Expecting coffee exports to hit a record $4 billion

Vietnam Coffee Cocoa Association (Vicofa) forecasted that if the export price of coffee remained at a high level, as in the first half of the year

Major investors worry as stock market weakens

The stock market boards have been covered with red amid investors’ rising caution. There are few buyers, while selling pressure still exists. Foreign investors’ behavior has affected the market.

Vietnam sees great potential in ASEAN halal market

Despite opportunities available in the ASEAN halal food market, Vietnamese exporters have to date exported only a small amount of halal products to some countries in the region.

Vietnam is becoming a beacon in the region: The Brussels Times

The Brussels Times of Belgium has run an article highlighting that Vietnam is becoming a beacon in the region with the capacity to control inflation and maintain economic growth at a high level despite turbulent international affairs.

Students' mindset about memorizing, copying texts stifles writing skills and creativity

A foreign professor who teaches at an international-standard university in Vietnam recently said he was disappointed about students’ semester-end exam papers.

At least six bodies found drifting off Phu Quoc seaside

Senior Lieutenant-Colonel Le Minh Chanh, Deputy Head of the Police Division of Phu Quoc City has just informed that the functional forces and residents have detected six bodies drifting off the seaside under a severe decomposition situation.

Police forces break down nearly 200-kilogram gold smuggling ring

The police have broken up a huge gold smuggling ring from Cambodia to Vietnam, said Lieutenant General To An Xo, spokesperson for the Ministry of Public Security of Vietnam.

Vietnam's CPI rises over 3% in Q3

Vietnam’s Consumer Price Index (CPI) in the third quarter of this year inched up 3.32% against the same period last year, according to data released by the General Statistics Office (GSO) on September 29.

Vietnam enjoys trade surplus of 6.52 bln USD in Jan-Sep

Vietnam estimates a trade surplus of 6.52 billion USD in the first nine months of this year.

Vietnamese, Cuban PMs discuss measures to boost cooperation

Prime Minister Pham Minh Chinh and his Cuban counterpart Manuel Marrero Cruz held talks following the official welcome ceremony in Hanoi on September 29 for the Cuban Government leader, who is paying an official visit from September 28-October 2.

Foreign service providers fulfill tax obligations in Vietnam

Since the portal for tax payment of cross border activities was launched on March 21 this year, 36 foreign service providers have registered, declared and paid taxes through it, heard a webinar held by the Government Portal on September 29.

Foreign Minister Bui Thanh Son pays official visit to Austria

Foreign Minister Bui Thanh Son paid an official visit to Austria on September 28 and 29, which is an important event when the two countries are marking the 50th anniversary of their diplomatic ties (1972-2022).

40 deaths by rabies in Vietnam this year

As many as 40 people in Vietnam have been killed by rabies since the start of this year.

More businesses need to use AI

AI is not a luxury. It can be applied on a large scale in many fields.