WTO entry worries Vietnam drugmakers

9 July 2006

Vietnam's drugmakers will inevitably face financial losses when the nation accedes to the World Trade Organization and they are exposed to giant international competitors, domestic firms concluded at a recent conference in Hanoi, reports the Vietnam Economic Times. Representatives of 135 drug companies convened in the capital to analyze the potential impact of WTO membership and to seek solutions to mitigate future losses.

It was suggested that, despite their cost advantage, locally-made drugs have already begun to lose market share to imported equivalents, attributable to inconsistent quality, poor marketing and a limited availability of specialized drugs. Under WTO regulations, drug companies will be able to import products directly, without going through authorized agents, meaning prices will become increasingly competitive, said participants. Additionally, tariffs on imported drugs are to be reduced from the existing 10% to an average of 2.5%, providing foreign companies yet another edge, says the newspaper.

Vietnam now has about 150 pharmaceutical companies, a third of which adhere to the internationally-recognized Good Manufacturing Practices standards, it adds.

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