Vietnam Medical Devices Report - Q3 2019

Q3 2019
www.fitchsolutions.com
Vietnam
Medical De
Devic
vices
es R
Report
eport
Includes 5-year forecasts to 2023
Vietnam Medical Devices Report | Q3 2019
Contents
Key View............................................................................................................................................................................................ 5
Medical Devices Key View ......................................................................................................................................................................................................... 5
SWOT .................................................................................................................................................................................................. 6
Medical Devices SWOT ............................................................................................................................................................................................................... 6
Industry Forecast........................................................................................................................................................................... 7
Medical Devices Forecast .......................................................................................................................................................................................................... 7
Consumables Forecast.............................................................................................................................................................................................................10
Diagnostic Imaging Forecast .................................................................................................................................................................................................14
Dental Forecast ...........................................................................................................................................................................................................................17
Orthopaedics And Prosthetics Forecast............................................................................................................................................................................20
Patient Aids Forecast.................................................................................................................................................................................................................23
Other Medical Devices Forecast ...........................................................................................................................................................................................26
Medical Devices Annual Imports..........................................................................................................................................................................................29
Medical Devices Monthly Imports .......................................................................................................................................................................................38
Medical Devices Annual Exports...........................................................................................................................................................................................39
Medical Devices Monthly Exports ........................................................................................................................................................................................48
Industry Risk/Reward Index ....................................................................................................................................................49

Medical Devices Industry Risk/Reward Index .................................................................................................................................................................49
Market Overview..........................................................................................................................................................................55
Medical Devices Overview.......................................................................................................................................................................................................55
Healthcare Overview.................................................................................................................................................................................................................57
Industry Trends And Developments .....................................................................................................................................64

Medical Devices Industry Trends And Developments .................................................................................................................................................64
Regulatory Development ..........................................................................................................................................................69

Medical Devices Regulatory Development ......................................................................................................................................................................69
Competitive Landscape.............................................................................................................................................................70
Medical Devices Manufacturing ...........................................................................................................................................................................................70
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Medical Devices National Manufacturers .........................................................................................................................................................................71

Medical Devices Multinational Manufacturers................................................................................................................................................................73
Medical Devices Multinational Activity ..............................................................................................................................................................................77
Medical Devices Market Access............................................................................................................................................................................................81
Medical Devices Methodology.................................................................................................................................................83
Key View
Medical Devices Key View
Key View: The Vietnamese medical device market will register high growth over the 2018-2023 period. The market will remain one
of the strongest performers in the Asia Pacific region, with Vietnam growing as a manufacturing location for medical device
companies and exports posting consistent growth.
PROJECTED MEDICAL DEVICE MARKET, 2018-2023

2018 2019 2020 2021 2022 2023
Total (Local Currency mn) 29,505,968.5 32,884,213.6 36,663,712.8 40,796,237.4 45,400,969.4 50,530,649.1
Per Capita (Local Currency) 305,789.4 337,519.6 372,749.7 410,903.8 453,127.3 499,886.1
Total (USDmn) 1,277.3 1,390.5 1,524.5 1,678.9 1,853.1 2,045.8
Per Capita (USD) 13.2 14.3 15.5 16.9 18.5 20.2
Exchange Rate (Local Currency/USD) 23,100 23,650 24,050 24,300 24,500 24,700
Source: National Statistics, Fitch Solutions
Latest Updates And Key Forecasts
• We maintain our forecast CAGR and project that the medical device market will increase at a 2018-2023 CAGR of 11.4% in local
currency terms 9.9% in US dollar terms, taking the value to VND50.5trn (USD2.0bn) in 2023.
• We expect imports to continue on their strong growth trajectory in 2019, supported by Vietnam's continuing regional economic
outperformance, rising healthcare expenditure and expansion of national health insurance coverage and other healthcare
programmes. In the 12 months to December 2018, imports increased by 8.5% in US dollar terms to USD1.1bn.
• Exports will continue to see sustained growth in 2019, as foreign companies increase their local manufacturing activity. The
growing number of free trade agreements, including the Comprehensive and Progressive Agreement for Trans-Pacific
Partnership (CPTPP), which entered into force for Vietnam in January 2019, will provide a further boost to exports. In the 12
months to December 2018, exports increased by 26.5% in US dollar terms to USD1.6bn.
• Terumo's plans to double its manufacturing capacity will strengthen its presence in the global interventional therapeutics market
and consolidate its role as one of the leading players in Vietnam's expanding medical device manufacturing sector. Closer
economic ties with Japan will likely see a shift in Japanese foreign direct investment (FDI) away from China to Vietnam, which
has a much cheaper operating environment. Vietnam will also benefit from moves to further open up its economy and liberalise
its trade, which will underpin robust growth in export-oriented manufacturing.
SWOT
Medical Devices SWOT
SWOT Analysis
Strengths • One-party system which is generally conducive to short-term political stability
• WTO membership and the ASEAN economic integration
• High number of university graduates with skilled degrees
• Large population of 94.6mn
• New public healthcare facilities being established
• Sixth fastest growing medical device market in the APAC region
Weaknesses • Small elderly population

• Sixth lowest healthcare expenditure per capita in the APAC region
• High level of out-of-pocket healthcare spending
• Insufficient amount of trained personnel to operate medical devices
• Sixth smallest medical device market in per capita terms in the region
• Market is concentrated in the major cities
• Small domestic production sector
Opportunities • The Communist Party of Vietnam's commitment to market-oriented reforms

• Improving relations with the US
• Economy a regional outperformer albeit with a slowdown in 2019
• Growing levels of foreign investment
• Increasing life expectancy
• ADB funding for improving healthcare service quality
• Increasing collaboration with countries such as South Korea
• Growth of medical tourism
• Expanding private healthcare sector
• Expansion of universal health coverage
• Healthcare digitalisation to improve medical access
• Rise in public hospital fees generating revenue for capital purchases
• Healthcare facilities in need of modernisation
• Lack of equipment in primary healthcare network
• Heavy reliance on imports
• Implementation of AMDD which will improve regulatory environment
• Increasing collaboration with overseas providers of technology and expertise
• Expanding medical device industry supported by growing multinational presence
• Proposed fiscal incentives for domestic medical device producers and assembly plants
• CPTPP which will improve market access to a trading bloc with a combined population of nearly 500mn
Threats • Weak currency keeping import costs high

• Deteriorating relations with China
• Corruption and inefficiency in the legal system
Industry Forecast
Medical Devices Forecast
Latest Updates
We maintain our forecast CAGR in local currency terms and project that the medical device market will grow at a 2018-2023 CAGR
of 11.4%, taking the value to VND50.5trn by 2023. The market will benefit from Vietnam remaining an outperformer in Asia, with
robust economic growth mainly driven by continued strong performance in the export-oriented manufacturing sector,
underpinned by liberal trade policies, positive demographics, and upskilling of the labour force. However, weaker external demand
on the back of slowing global growth, which will weigh on Vietnam’s manufacturing activity, poses downside risks.
Medical Device Market, Local Currency

(2013-2023)
We maintain our forecast CAGR in US dollar terms and project a 2018-2023 CAGR of 9.9%, taking the market to USD2.0bn by
2023. We expect the Vietnamese currency to slowly weaken against the US dollar over the forecast period. The market will see high
single-digit increases between 2019 and 2021, rising to double-digit growth in 2022 and 2023.
Medical Device Market, US Dollar

(2013-2023)
Structural Trends
The market will benefit from key drivers:
• Strong fundamentals: the one-party system, which is generally conducive to short-term political stability; the Communist
Party of Vietnam's commitment to market-oriented reforms; improving relations with the US, and Washington's view of Hanoi as
a potential geopolitical ally in South East Asia; WTO membership and the ASEAN economic integration that should give Vietnam
greater access to both foreign markets and capital, while making Vietnamese enterprises stronger through increased foreign
competition; strong economic growth; the high number of university graduates with skilled degrees; and the growing levels of
foreign investment that encourage further trade and spin-off industries.
• Healthcare drivers: the large population of 94.6mn; rising life expectancy; increasing collaboration with countries such as
South Korea; the expanding private healthcare sector and medical tourism; expansion of universal health coverage; the
implementation of a national electronic health records system by the end of 2019; the rise in public hospital fees that may
generate revenue for capital purchases; the new public healthcare facilities that are being established; the need to modernise
and re-equip healthcare facilities; the lack of equipment in primary healthcare network and ADB funding for improving
healthcare service quality.
• Market drivers: fifth fastest growing market in the Asia Pacific (APAC) region; heavy reliance on imports; implementation of the
AMDD that will improve the regulatory environment; proposed fiscal incentives for domestic medical device producers and
assembly plants, which could help reduce import dependence; increasing collaboration with overseas providers of technology
and expertise; and improved market access under CPTPP.
Market growth will be constrained by:
• Weak fundamentals: The heavily-managed and weak currency that reduces incentives to improve the quality of exports, and
keeps import costs high; deteriorating relations with China, due to Beijing's more assertive stance over disputed islands in the
South China Sea; and corruption and inefficiency in the legal system.
• Healthcare barriers: the small elderly population, which represented 6.9% of the total in 2016; the sixth lowest healthcare
expenditure per capita in the APAC region; the high level of out-of-pocket healthcare spending; and the insufficient amount of
trained healthcare personnel to operate medical devices.
• Market barriers: the size of the market in per capita terms, being the sixth smallest in the APAC region; the market being
concentrated in the major cities of Hanoi, Haiphong and Ho Chi Minh City, while the rest of the country is often lacking in good
communications and other infrastructure; the lack of regulations for medical devices; and the small domestic production sector.
MEDICAL DEVICE MARKET BY PRODUCT AREA, 2013-2023 (USDMN)

2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
CONSUMABLES 126 137 138 156 169 183 199 217 238 261 287
DIAGNOSTIC IMAGING 219 232 271 333 345 373 402 437 477 522 571
DENTAL PRODUCTS 28 30 35 43 47 51 56 62 68 75 83
ORTHOPAEDICS &
57 65 81 94 104 116 129 144 161 181 203
PROSTHETICS
PATIENT AIDS 116 126 129 163 178 195 213 235 260 289 320
OTHER MEDICAL DEVICES 227 223 252 302 328 359 391 430 475 526 582
TOTAL 773 814 905 1,090 1,171 1,277 1,390 1,524 1,679 1,853 2,046
Consumables Forecast
Latest Updates
We maintain our forecast CAGR in local currency terms and project that the consumables market will grow at a 2018-2023 CAGR of
10.8%, taking the value to VND7.1trn by 2023. Consumables will be one of the slowest growing sectors of the Vietnamese medical
device market. The market will benefit from Vietnam remaining an outperformer in Asia, with robust economic growth mainly driven
by continued strong performance in the export-oriented manufacturing sector, underpinned by liberal trade policies, positive
demographics, and upskilling of the labour force. We have also considered the ageing population, the burden of non-
communicable diseases, improving healthcare access, recent import performance, market barriers and company activities to
calculate our forecasts.
Consumables Market, Local Currency

(2013-2023)
We maintain our forecast CAGR in US dollar terms and project a 2018-2023 CAGR of 9.4%, taking the market value to USD286.7mn
by 2023. We expect the Vietnamese currency to slowly weaken against the US dollar over the forecast period. The market will see
high single-digit growth from 2019 onwards.
Consumables Market, US Dollar

(2013-2023)
Structural Trends
Imports supply over 70% of this market, sourced largely from China, Thailand, the US and Japan.
There is some local production of consumable items. Minh Tam in Ho Chi Minh City manufactures nasal cannulae, infusion sets,
feeding tubes and suction catheters, while Mediplast in Hanoi and Perfect Medical in Ho Chi Minh produce syringes and infusion
products.
Bandages & Dressings
We forecast the market for bandages and dressings to expand by a US dollar 2018-2023 CAGR of 10.5%, which will see it increase to
USD60.5mn in 2023. Adhesive dressings will be the best performing segment.
Imports account for over 90% of this market, supplied mainly from Thailand, Taiwan and China.
Suturing Materials
We forecast the market for suturing materials to expand by a US dollar 2018-2023 CAGR of 5.8%, which will see it rise to
USD19.1mn in 2023. This will be the weakest performing area of the consumables market.
Imports supply almost all of this market, mainly sourced from the US, Spain and Germany.
Syringes, Needles & Catheters
Syringes, needles & catheters will remain the largest sector of the consumables market. We forecast growth at a US dollar
2018-2023 CAGR of 9.4%, taking the value to USD193.5mn in 2023. The most dynamic product segment will be other needles,
catheters and cannulae.
Import penetration is lower in this sector due to a significant domestic manufacturing presence. Imports supply around 60% of this
market, largely sourced from China, Japan, the US and Malaysia.
Other Consumables
We forecast the market for other consumables to expand by a US dollar 2018-2023 CAGR of 9.7%, which should see it rise to
USD13.7mn in 2023. Growth will be driven by demand for blood-grouping reagents and surgical gloves.
Imports account for almost all of the market, with Malaysia and India the leading suppliers.
CONSUMABLES MARKET, 2013-2023 (USDMN)

2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
CONSUMABLES 126.1 137.3 137.9 156.0 168.8 183.2 198.6 216.8 237.6 261.0 286.7
BANDAGES & DRESSINGS 24.8 24.4 26.1 30.7 33.6 36.8 40.3 44.5 49.2 54.6 60.5
Medical dressings (adhesive) 18.5 18.0 19.2 22.3 24.5 27.0 29.7 32.8 36.4 40.6 45.1
Medical dressings (non-

6.3 6.4 6.9 8.4 9.1 9.8 10.7 11.6 12.8 14.0 15.4
adhesive)
SUTURING MATERIALS 12.2 12.5 11.5 13.0 13.7 14.4 15.1 15.9 16.8 17.9 19.1
SYRINGES, NEEDLES &

84.9 95.4 93.9 105.1 113.7 123.4 133.9 146.2 160.3 176.1 193.5
CATHETERS
Syringes (with/without
7.0 8.6 8.8 13.6 14.7 15.8 17.1 18.6 20.3 22.3 24.4
needles)
Tubular metal needles/needles

7.6 8.5 9.6 10.7 11.5 12.3 13.2 14.2 15.4 16.7 18.1
for sutures
Other needles, catheters,

70.3 78.4 75.4 80.8 87.6 95.3 103.7 113.5 124.6 137.2 150.9
cannulae etc
OTHER CONSUMABLES 4.2 5.0 6.4 7.3 7.9 8.6 9.3 10.2 11.2 12.4 13.7
Blood-grouping reagents 1.0 1.6 2.3 2.5 2.7 3.0 3.3 3.6 4.0 4.4 4.9
First-aid boxes & kits 0.2 0.3 0.8 0.5 0.6 0.6 0.7 0.7 0.8 0.8 0.9
Ostomy products 0.3 0.4 0.5 0.7 0.7 0.8 0.8 0.9 1.0 1.0 1.1
Surgical gloves 2.6 2.8 2.9 3.6 3.9 4.2 4.6 5.0 5.5 6.1 6.7
Diagnostic Imaging Forecast
Latest Updates
We maintain our forecast CAGR in local currency terms and project that the diagnostic imaging market will grow at a 2018-2023
CAGR of 10.4%, taking the value to VND14.1trn by 2023. Diagnostic imaging will be the slowest growing sector within the
Vietnamese medical device market. The market will benefit from Vietnam remaining an outperformer in Asia, with robust economic
growth mainly driven by continued strong performance in the export-oriented manufacturing sector, underpinned by liberal trade
policies, positive demographics, and upskilling of the labour force. We have also considered the ageing population, the burden of
non-communicable diseases, improving healthcare access, new technology acquisition, recent import performance, market barriers
and company activities to calculate our forecasts.
Diagnostic Imaging Market, Local Currency

(2013-2023)
We maintain our forecast CAGR in US dollar terms and project a 2018-2023 CAGR of 8.9%, taking the market value to USD570.9mn
by 2023. We expect the Vietnamese currency to slowly weaken against the US dollar over the forecast period. The market will see
high single-digit growth from 2019 onwards.
Diagnostic Imaging Market, US Dollar

(2013-2023)
Structural Trends
Imports supply over 95% of this market, sourced mainly from Japan, the US, Germany, South Korea and China.
The joint venture Vikomed in Hanoi manufactures fluoroscopy devices, lithotripters and picture archiving and communication
systems (PACS), while Vina Medical in Hanoi has a joint venture with Shimadzu of Japan to produce X-ray and ultrasound equipment.
Electrodiagnostic Apparatus
Electrodiagnostic apparatus will remain the largest sector of the diagnostic imaging market. We forecast the market will expand by a
US dollar 2018-2023 CAGR of 8.9% to reach USD232.3mn in 2023. Scintigraphic apparatus will exhibit the strongest growth.
Imports supply over 90% of this market, coming mainly from Japan, South Korea, China, the US and Germany.
Radiation Apparatus
We forecast the market for radiation apparatus to expand by a US dollar 2018-2023 CAGR of 8.0%, which will take it to USD170.8mn
in 2023. Other medical X-ray apparatus will exhibit the strongest growth.
Imports supply almost all of the market, coming mainly from Japan, the US and Germany.
In October 2014, EOS imaging reported its continued growth in the Southeast Asian market with the installation of an EOS imaging
system at the Medic Medical Center (MMC) in Ho Chi Minh City. MMC is claimed to be the largest radiological centre in the country.
Imaging Parts & Accessories
We forecast the market for imaging parts & accessories to expand by a US dollar 2018-2023 CAGR of 9.9%, which will take the value
to USD167.8mn in 2023. Contrast media will show the strongest growth.
Imports supply almost all of the market. These come mainly from the US and Japan with France, Ireland and Germany the leading
suppliers of contrast media.
DIAGNOSTIC IMAGING MARKET, 2013-2023 (USDMN)

2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
DIAGNOSTIC IMAGING 219.1 232.4 271.2 332.9 344.8 372.8 402.4 437.1 477.1 521.9 570.9
ELECTRODIAGNOSTIC
119.4 115.6 137.0 130.3 140.5 152.0 164.0 178.1 194.4 212.5 232.3
APPARATUS
Electrocardiographs 4.4 3.7 5.4 4.3 4.6 4.9 5.3 5.8 6.3 7.0 7.6
Ultrasound 42.2 34.8 42.1 47.8 51.4 55.5 59.9 65.1 71.1 77.9 85.3
MRI 17.9 22.6 28.2 29.3 31.9 34.8 37.9 41.5 45.7 50.4 55.5
Scintigraphic apparatus 0.1 0.8 1.9 0.1 0.3 0.5 0.6 0.7 0.8 0.9 1.0
Other electrodiagnostic
54.7 53.6 59.3 48.8 52.3 56.2 60.3 65.0 70.4 76.5 82.9
apparatus
RADIATION APPARATUS 44.8 57.7 60.9 114.3 108.3 116.3 124.5 134.2 145.2 157.5 170.8
CT scanners 21.0 22.8 30.3 54.7 57.8 61.3 64.8 69.1 73.8 79.1 84.7
Other medical X-ray apparatus 23.2 31.7 29.8 44.9 48.8 53.2 57.8 63.1 69.2 76.0 83.5
A, B, C ray apparatus 0.6 3.1 0.8 14.7 1.7 1.8 1.9 2.1 2.2 2.4 2.6
IMAGING PARTS &

54.9 59.1 73.4 88.3 96.0 104.6 113.9 124.9 137.5 151.9 167.8
ACCESSORIES
Contrast media 15.1 22.3 28.4 37.2 41.5 46.2 51.4 57.4 64.5 72.5 81.6
Medical X-ray film (flat) 27.1 27.8 32.0 35.4 37.8 40.5 43.3 46.7 50.7 55.0 59.7
Medical X-ray film (rolled) 0.3 0.1 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
X-ray tubes 1.6 2.7 3.2 3.5 3.8 4.1 4.4 4.8 5.3 5.8 6.3
Other imaging parts &

10.7 6.2 9.7 12.1 12.9 13.8 14.7 15.8 17.1 18.5 20.1
accessories
Dental Forecast
Latest Updates
We maintain our forecast CAGR in local currency terms and project that the dental market will grow at a 2018-2023 CAGR of 11.7%,
taking the value to VND2.1trn by 2023. Growth will be slightly above average for the medical device market. The market will benefit
from robust economic growth that will be mainly driven by continued strong performance in the export-oriented manufacturing
sector, underpinned by liberal trade policies, positive demographics, and upskilling of the labour force. We have also considered the
ageing population, dental care access, recent import performance, market barriers and company activities to calculate our
forecasts.
Dental Products Market, Local Currency

(2013-2023)
We maintain our forecast CAGR in US dollar terms and now project a 2018-2023 CAGR of 10.2%, taking the market value to
USD83.4mn by 2023. We expect the Vietnamese currency to slowly weaken against the US dollar over the forecast period. The
market will see high single-digit increases in 2019 and 2020, rising to double-digit growth from 2021 onwards.
Dental Products Market, US Dollar

(2013-2023)
Structural Trends
Imports supply around 90% of this market, sourced mainly from Japan, South Korea, the US and Germany.
Capital Equipment
We forecast the market for capital equipment to expand by a US dollar 2018-2023 CAGR of 9.3%, which will take it to USD14.3mn in
2023. Dental chairs will be the strongest performing segment.
Imports supply over 90% of this market. South Korea is the leading supplier due to its dominant position in dental X-ray apparatus.
China and Japan are the leading suppliers of dental chairs.
Instruments & Supplies
Instruments & supplies represent over 80% of Vietnam's dental market. We forecast the market to expand by a US dollar 2018-2023
CAGR of 10.4%, which will see it increase to USD69.0mn in 2023. Other dental fittings will exhibit the highest growth.
Imports supply about 90% of this market, mainly sourced from Japan and the US, followed by South Korea which is the leading
supplier of other dental fittings.
DENTAL PRODUCTS MARKET, 2013-2023 (USDMN)

2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
DENTAL PRODUCTS 27.8 29.8 35.0 42.9 46.9 51.3 56.1 61.6 68.1 75.3 83.4
CAPITAL EQUIPMENT 3.7 3.5 4.9 7.9 8.5 9.2 9.9 10.8 11.9 13.1 14.3
Dental drills 1.1 0.7 1.0 1.2 1.3 1.4 1.5 1.6 1.7 1.9 2.0
Dental chairs 1.3 1.2 1.6 2.5 2.8 3.1 3.4 3.8 4.3 4.8 5.4
Dental X-ray 1.4 1.7 2.3 4.2 4.4 4.7 5.1 5.4 5.9 6.4 6.9
INSTRUMENTS & SUPPLIES 24.2 26.3 30.1 35.0 38.4 42.1 46.1 50.8 56.2 62.2 69.0
Dental cements 7.5 8.9 9.7 10.9 11.9 13.0 14.2 15.7 17.4 19.1 21.2
Dental instruments 11.9 11.6 13.1 15.9 17.3 18.9 20.5 22.4 24.6 27.1 29.8
Teeth & other fittings 4.7 5.8 7.3 8.3 9.2 10.3 11.4 12.7 14.3 16.0 18.0
Artificial teeth 1.0 0.9 1.2 0.8 0.9 1.0 1.0 1.1 1.2 1.4 1.5
Other dental fittings 3.7 4.9 6.1 7.5 8.3 9.3 10.3 11.6 13.0 14.7 16.5
Orthopaedics And Prosthetics Forecast
Latest Updates
We maintain our forecast CAGR in local currency terms and project that the orthopaedics & prosthetics market will grow at a
2018-2023 CAGR of 13.4%, taking the value to VND5.0trn by 2023. Orthopaedics & prosthetics will be the fastest growing
sector within Vietnam's medical device market. The market will benefit from robust economic growth that will be mainly driven by
continued strong performance in the export-oriented manufacturing sector, underpinned by liberal trade policies, positive
demographics, and upskilling of the labour force. We have also considered the ageing population, the burden of non-communicable
diseases, improving healthcare access, recent import performance, market barriers and company activities to calculate our
forecasts.
Orthopaedics & Prosthetics Market, Local Currency

(2013-2023)
We maintain our forecast CAGR in US dollar terms and project a 2018-2023 CAGR of 11.9%, taking the market value to
market will see double-digit growth from 2019 onwards.
Orthopaedics & Prosthetics Market, US Dollar

(2013-2023)
Structural Trends
Imports supply almost all of this market, sourced primarily from the US, Switzerland and the EU-28.
Fixation Devices
We forecast the market for fixation devices to expand by a US dollar 2018-2023 CAGR of 11.8%, which will see it increase to
USD75.7mn in 2023.
Imports supply almost all of this market, sourced mainly from the US.
Artificial Joints
We forecast the market for artificial joints to expand by a US dollar 2018-2023 CAGR of 11.6%, which will take it to USD12.8mn in
2023.
Imports supply almost all of this market. The US is the leading supplier, accounting for more than half of the import total.
Switzerland and Germany are the other significant suppliers.
Other Artificial Body Parts
We forecast the market for other artificial body parts to expand by a US dollar 2018-2023 CAGR of 12.0%, which will see it increase
to USD114.4mn in 2023. This makes artificial body parts the largest and fastest growing sector of the orthopaedics & prosthetics
market.
Imports supply almost all of this market, primarily sourced from the US. Switzerland, Germany and Ireland are smaller suppliers.
ORTHOPAEDICS & PROSTHETICS MARKET, 2013-2023 (USDMN)

2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
ORTHOPAEDICS &
57.3 64.8 80.7 93.6 104.1 115.9 128.6 143.7 161.1 180.8 203.0
PROSTHETICS
FIXATION DEVICES 17.3 19.6 24.4 35.2 39.0 43.4 48.0 53.6 60.1 67.5 75.7
ARTIFICIAL JOINTS 4.2 4.6 4.7 6.1 6.7 7.4 8.2 9.1 10.2 11.5 12.8
OTHER ARTIFICIAL BODY PARTS 35.8 40.6 51.6 52.4 58.4 65.1 72.3 80.9 90.7 101.9 114.4
Patient Aids Forecast
Latest Updates
We maintain our forecast CAGR in local currency terms and project that the patient aids market will grow at a 2018-2023 CAGR of
11.9%, taking the value to VND7.9trn by 2023. Growth will be slightly above average for the Vietnamese medical device market.
The market will benefit from robust economic growth that will be mainly driven by continued strong performance in the export-
oriented manufacturing sector, underpinned by liberal trade policies, positive demographics, and upskilling of the labour force. We
have also considered the ageing population, the burden of non-communicable diseases, improving healthcare access, recent
import performance, market barriers and company activities to calculate our forecasts.
Patient Aids Market, Local Currency

(2013-2023)
market will see high single-digit growth in 2019 and double-digit growth from 2020.
Patient Aids Market, US Dollar

(2013-2023)
Structural Trends
Imports supply around 90% of this market, sourced largely from the US, China, Germany, Ireland and South Korea.
All but the most basic items are imported, although there is now some local production of hearing aids; this began in 2006 when
the Danish company, Sonion, established a plant in Ho Chi Minh City. This company however concentrates on exports.
Portable Aids
We forecast the market for portable aids to expand by a US dollar 2018-2023 CAGR of 11.1%, which will see it increase to
USD212.7mn in 2023. The portable aids market will continue to be the largest sector within Vietnam's patient aids market,
representing about two-thirds of the total value. It will also be the best performing sector over the forecast period with all product
segments achieving double-digit CAGRs.
Imports account for around 85% of the market. The US is the leading supplier overall, contributing around a fifth of the import total.
The US heads the hearing aids segment, followed by Australia and China. Germany and Malaysia are the leading suppliers of
pacemakers and Ireland and the US the leading suppliers of other portable aids.
Therapeutic Appliances
We forecast the market for therapeutic appliances to expand by a US dollar 2018-2023 CAGR of 9.0%, which will take it to
USD107.4mn in 2023. Therapeutic respiration apparatus will exhibit the strongest growth.
Imports supply almost all of this market, with the majority sourced from China and South Korea. The US is the leading supplier of
therapeutic respiration apparatus.
PATIENT AIDS MARKET, 2013-2023 (USDMN)

2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
PATIENT AIDS 116.2 126.3 128.8 162.9 178.1 195.3 213.5 235.0 260.1 288.5 320.1
PORTABLE AIDS 70.9 75.2 81.4 103.4 113.7 125.4 138.1 153.0 170.5 190.4 212.7
Hearing aids 16.8 15.1 15.7 20.1 21.9 23.9 26.1 28.8 31.8 35.3 39.1
Pacemakers 3.7 3.9 3.8 4.3 4.7 5.2 5.7 6.4 7.1 7.9 8.9
Other portable aids 50.4 56.2 61.9 79.0 87.1 96.3 106.2 117.8 131.5 147.2 164.7
THERAPEUTIC APPLIANCES 45.4 51.2 47.4 59.5 64.4 69.8 75.4 82.0 89.6 98.1 107.4
Mechano-therapy apparatus 30.6 32.3 32.5 37.3 40.2 43.4 46.7 50.6 55.0 59.9 65.3
Therapeutic respiration apparatus 14.8 18.8 14.9 22.2 24.2 26.4 28.7 31.4 34.6 38.2 42.1
Other Medical Devices Forecast
Latest Updates
We maintain our forecast CAGR in local currency terms and project that the patient aids market will grow at a 2018-2023 CAGR of
11.6%, taking the value to VND14.4trn by 2023. Growth will be slightly above average for the Vietnamese medical device market.
The market will benefit from robust economic growth that will be mainly driven by continued strong performance in the export-
oriented manufacturing sector, underpinned by liberal trade policies, positive demographics, and upskilling of the labour force. We
have also considered the ageing population, the burden of non-communicable diseases, improving healthcare access, recent
import performance, market barriers and company activities to calculate our forecasts.
Other Medical Devices Market, Local Currency

(2013-2023)
market will see high single-digit growth in 2019 and double-digit growth from 2020.
Other instruments & appliances and wheelchairs will be the best performing subcategories with double-digit US dollar
2018-2023 CAGRs, while other product segments will have mid to high single-digit CAGRs.
Other Medical Devices Market, US Dollar

(2013-2023)
Structural Trends
Imports supply over 90% of this market. Imports are mainly sourced from Germany, the US and Japan. China is the leading supplier
of hospital furniture, wheelchairs and UV/IR apparatus.
Vina Medical in Hanoi produces hospital furniture including beds, examination tables, medical injection trolleys and bedside
cabinets.
OTHER MEDICAL DEVICES MARKET, 2013-2023 (USDMN)

2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
OTHER MEDICAL DEVICES 226.6 223.1 251.7 301.7 328.2 358.8 391.3 430.2 474.9 525.6 581.8
WHEELCHAIRS 4.8 5.6 7.8 10.9 11.9 13.0 14.2 15.6 17.3 19.1 21.2
Wheelchairs, not mechanically

1.2 1.4 2.2 3.0 3.3 3.7 4.1 4.5 5.0 5.6 6.2
propelled
Wheelchairs, mechanically propelled 3.6 4.2 5.7 7.9 8.5 9.3 10.1 11.1 12.3 13.6 15.0
OPHTHALMIC INSTRUMENTS 18.6 16.4 15.5 21.3 22.8 24.5 26.3 28.3 30.7 33.3 36.1
HOSPITAL FURNITURE 13.9 16.3 17.1 29.0 31.0 33.1 35.3 38.0 41.0 44.3 47.8
MEDICAL, SURGICAL STERILISERS 15.0 17.1 12.4 16.3 17.1 17.9 18.8 19.8 21.0 22.3 23.7
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
ULTRA-VIOLET OR INFRA-RED RAY

0.4 0.4 0.5 0.7 0.7 0.7 0.7 0.8 0.8 0.9 0.9
APPARATUS
OTHER INSTRUMENTS &

173.9 167.3 198.4 223.5 244.9 269.6 296.1 327.7 364.2 405.7 452.0
APPLIANCES
Medical Devices Annual Imports
Latest Updates
In local currency terms, medical device imports have experienced robust growth in recent years, having increased in each year since
2008. In 2016, imports rose by 23.1%, to reach a record high of VND22.2trn. Imports registered a 2011-2016 CAGR of 12.6%,
ranging from 8.5% for consumables up to 16.9% for orthopaedics & prosthetics.
Medical Device Imports, Local Currency

(2006-2016)
Source: ITC, Fitch Solutions
Medical device imports have experienced strong growth in recent years when measured in US dollars, having increased in each year
since 2008. In 2016, imports rose by 20.7%, to reach a record level of USD994.0mn. Imports registered a 2011-2016 CAGR of
10.8%, ranging from 6.8% for consumables to 15.0% for orthopaedics & prosthetics.
Medical Device Imports, US Dollar

(2006-2016)
Structural Trends
Diagnostic imaging was the largest product area in 2016, accounting for around a third of total imports, followed by other medical
devices with just under 30%. Patient aids and consumables each contributed 10-15% of imports and orthopaedics & prosthetics
just under 10%. Dental products is the smallest product area, accounting for less than 5% of the import total.
All product areas registered double-digit growth in 2016. Patient aids was the best performing product area, recording an increase
of over 30% in both local currency and US dollar terms, while diagnostic imaging and dental products both posted increases of over
20%.
Orthopaedics & prosthetics has been the strongest product area over the past five years with a 2012-2017 CAGR of 16.9% when
measured in local currency and 15.0% in US dollar terms. All other product areas registered double-digit CAGRs except
consumables which registered a 2012-2017 CAGR of 8.5% when measured in local currency and 6.8% in US dollar terms.
Leading Suppliers
The US was the leading supplier in 2016, with imports valued at USD195.7mn, equivalent to 20% of the total. While the US featured
strongly across all sectors in 2016, it was only the leading supplier in two product areas, taking a 43% share of orthopaedics &
prosthetics imports and 17% of patient aids imports.
Japan and Germany ranked second and third in 2016, both supplying 14% of total imports. Japan was the leading supplier of
diagnostic imaging and dental imports. Germany was the leading supplier of other medical devices.
China held a 10% share of imports in 2016, taking a leading position in the consumables sector.
The EU-28 supplied a third of imports in 2016, valued at USD326.0mn. In addition to Germany, leading EU suppliers included France
and Ireland.
TOP 20 MEDICAL DEVICE SUPPLIERS, 2016 (USD000S)

Country 2016 % Total
1 US 195,708 19.7
2 Japan 142,670 14.4
3 Germany 141,346 14.2
4 China 97,755 9.8
5 South Korea 71,999 7.2
6 France 54,955 5.5
7 Ireland 37,535 3.8
8 Switzerland 35,106 3.5
9 UK 22,137 2.2
10 India 19,597 2.0
11 Taiwan 18,060 1.8
12 Thailand 17,084 1.7
13 Malaysia 15,961 1.6
14 Italy 14,850 1.5
15 Belgium 11,961 1.2
16 Netherlands 10,866 1.1
17 Mexico 10,800 1.1
18 Sweden 9,895 1.0
19 Area Not Specified 6,003 0.6
20 Spain 5,349 0.5
Subtotal 939,637 94.5
Others 54,323 5.5
Total 993,960 100.0
DETAILED MEDICAL DEVICE IMPORTS BY PRODUCT AREA, 2012-2016 (USD000S)

2012 2013 2014 2015 2016
CONSUMABLES 93,048 91,917 101,692 101,091 114,094
BANDAGES & DRESSINGS 23,481 23,939 23,783 25,230 29,398
Medical dressings (adhesive) 17,656 17,982 17,495 18,425 21,226
Medical dressings (non-adhesive) 5,825 5,957 6,288 6,805 8,172
SUTURING MATERIALS 14,171 12,176 12,407 11,485 12,970
SYRINGES, NEEDLES & CATHETERS 52,234 51,608 60,593 58,192 64,738
Syringes (with/without needles) 5,802 6,418 8,043 8,307 13,173
Tubular metal needles/needles for 6,363 6,012 6,921 7,593 8,195

sutures
Other needles, catheters, cannulae etc 40,069 39,178 45,629 42,292 43,370
OTHER CONSUMABLES 3,162 4,194 4,909 6,184 6,988
Blood-grouping reagents 534 1,049 1,553 2,344 2,483
First-aid boxes & kits 204 222 275 760 535
Ostomy products 347 321 385 456 666
Surgical gloves 2,077 2,602 2,696 2,624 3,304
DIAGNOSTIC IMAGING 232,188 210,554 222,916 260,526 322,647
ELECTRODIAGNOSTIC APPARATUS 114,312 111,191 106,410 126,595 120,491
Electrocardiographs 3,129 4,406 3,737 5,383 4,244
Ultrasound 38,855 42,198 34,780 42,111 47,765
MRI 22,143 17,920 22,632 28,172 29,310
Scintigraphic apparatus 761 139 849 1,901 72
Other electrodiagnostic apparatus 49,424 46,528 44,412 49,028 39,100
RADIATION APPARATUS 72,587 44,609 57,561 60,824 114,243
CT scanners 38,780 20,783 22,809 30,241 54,727
Other medical X-ray apparatus 30,685 23,222 31,628 29,796 44,852
A, B, C ray apparatus 3,122 604 3,124 787 14,664
IMAGING PARTS & ACCESSORIES 45,289 54,754 58,945 73,107 87,913
Contrast media 13,911 15,138 22,335 28,445 37,243

2012 2013 2014 2015 2016
Medical X-ray film (flat) 24,874 27,103 27,768 31,860 35,265
Medical X-ray film (rolled) 402 253 91 31 30
X-ray tubes 1,810 1,611 2,692 3,181 3,451
Other imaging parts & accessories 4,292 10,649 6,059 9,590 11,924
DENTAL PRODUCTS 22,865 25,709 26,969 31,232 38,235
CAPITAL EQUIPMENT 3,016 3,446 3,141 4,416 7,377
Dental drills 776 1,054 695 990 1,185
Dental chairs 574 1,034 790 1,166 2,032
Dental X-ray 1,666 1,358 1,656 2,260 4,160
INSTRUMENTS & SUPPLIES 19,849 22,263 23,828 26,816 30,858
Dental cements 6,655 7,212 8,671 9,384 10,510
Dental instruments 9,317 11,248 10,844 12,192 14,763
Teeth & other fittings 3,877 3,803 4,313 5,240 5,585
Artificial teeth 861 1,043 843 1,171 789
Other dental fittings 3,016 2,760 3,470 4,069 4,796
ORTHOPAEDICS & PROSTHETICS 47,752 56,296 64,084 79,765 92,189
FIXATION DEVICES 13,518 16,280 18,892 23,526 33,782
ARTIFICIAL JOINTS 3,847 4,204 4,649 4,655 6,057
OTHER ARTIFICIAL BODY PARTS 30,387 35,812 40,543 51,584 52,350
PATIENT AIDS 87,042 99,337 109,673 110,719 147,933
PORTABLE AIDS 47,171 54,512 59,071 63,856 88,948
Hearing aids 10,066 9,929 8,810 8,344 11,722
Pacemakers 2,679 3,650 3,863 3,787 4,289
Other portable aids 34,426 40,933 46,398 51,725 72,937
THERAPEUTIC APPLIANCES 39,871 44,825 50,602 46,863 58,985
Mechano-therapy apparatus 26,223 30,217 32,156 32,397 37,262
Therapeutic respiration apparatus 13,648 14,608 18,446 14,466 21,723
OTHER MEDICAL DEVICES 197,840 217,419 212,794 240,290 278,862
2012 2013 2014 2015 2016
WHEELCHAIRS 2,607 2,836 3,049 4,064 5,273
Wheelchairs, not mechanically propelled 1,310 1,109 1,350 2,115 2,994
Wheelchairs, mechanically propelled 1,297 1,727 1,699 1,949 2,279
OPHTHALMIC INSTRUMENTS 12,673 18,049 15,512 14,171 20,064
HOSPITAL FURNITURE 8,388 9,988 12,103 14,808 24,290
MEDICAL, SURGICAL STERILISERS 10,014 14,920 17,052 12,346 16,214
ULTRA-VIOLET OR INFRA-RED RAY 430 402 364 458 652

APPARATUS
OTHER INSTRUMENTS & APPLIANCES 163,728 171,224 164,714 194,443 212,369
TOTAL 680,735 701,232 738,128 823,623 993,960
DETAILED LEADING MEDICAL DEVICE SUPPLIERS BY PRODUCT AREA, 2016 (USD000S)

US Japan Germany China South Korea EU-28
CONSUMABLES 13,178 12,871 6,801 16,343 4,172 20,786
BANDAGES & DRESSINGS 1,588 1,299 378 3,953 1,826 1,958
Medical dressings (adhesive) 1,322 960 328 2,461 1,620 748
Medical dressings (non-adhesive) 266 339 50 1,492 206 1,210
SUTURING MATERIALS 3,226 204 2,027 242 188 6,750
SYRINGES, NEEDLES & CATHETERS 7,805 11,167 4,223 11,978 2,156 11,186
Syringes (with/without needles) 2,086 2,526 1,959 1,788 1,382 3,131
Tubular metal needles/needles for 602 1,273 127 3,794 338 395
sutures
Other needles, catheters, cannulae 5,117 7,368 2,137 6,396 436 7,660
etc
OTHER CONSUMABLES 559 201 173 170 2 892
Blood-grouping reagents 360 0 125 2 0 386
First-aid boxes & kits 190 201 48 41 2 79
Ostomy products 9 0 0 3 0 425
Surgical gloves 0 0 0 124 0 2
DIAGNOSTIC IMAGING 58,941 74,984 43,255 30,066 31,148 112,705
ELECTRODIAGNOSTIC APPARATUS 17,050 33,779 15,237 17,430 21,037 24,176
Electrocardiographs 268 2,164 252 580 237 475
Ultrasound 4,901 12,273 81 6,851 17,608 4,098
MRI 6,326 6,990 8,419 5,697 0 10,297
Scintigraphic apparatus 8 0 0 20 36 7
Other electrodiagnostic apparatus 5,547 12,352 6,485 4,282 3,156 9,299
RADIATION APPARATUS 21,038 23,120 18,381 10,679 6,975 47,711
CT scanners 6,579 19,227 13,310 7,526 543 18,241
Other medical X-ray apparatus 14,354 3,891 4,468 2,335 6,403 17,057
A, B, C ray apparatus 105 2 603 818 29 12,413
IMAGING PARTS & ACCESSORIES 20,853 18,085 9,637 1,957 3,136 40,818
Contrast media 5,489 1,778 6,613 187 131 28,512
Medical X-ray film (flat) 11,036 15,281 3 500 0 8,442
Medical X-ray film (rolled) 18 0 0 0 0 11
X-ray tubes 1,563 215 610 294 8 737
Other imaging parts & accessories 2,747 811 2,411 976 2,997 3,116
DENTAL PRODUCTS 5,331 6,860 3,975 2,740 5,629 10,205
CAPITAL EQUIPMENT 344 1,067 792 750 2,131 2,495
Dental drills 102 384 117 77 42 417
Dental chairs 136 408 16 673 175 234
Dental X-ray 106 275 659 0 1,914 1,844
INSTRUMENTS & SUPPLIES 4,987 5,793 3,183 1,990 3,498 7,710
Dental cements 2,327 4,434 614 37 711 2,014
Dental instruments 1,706 1,084 2,078 1,872 1,618 4,028
Teeth & other fittings 954 275 491 81 1,169 1,668
Artificial teeth 174 274 185 16 0 324
Other dental fittings 780 1 306 65 1,169 1,344
ORTHOPAEDICS & PROSTHETICS 39,154 2,058 9,492 3,296 1,610 28,070
FIXATION DEVICES 15,266 0 2,949 1,688 1,462 10,543
ARTIFICIAL JOINTS 3,325 0 829 2 0 1,215
OTHER ARTIFICIAL BODY PARTS 20,563 2,058 5,714 1,606 148 16,312
PATIENT AIDS 24,574 4,217 19,740 20,316 15,705 55,652
PORTABLE AIDS 17,510 840 14,411 2,470 1,953 42,844
Hearing aids 2,813 387 295 1,210 84 2,962
Pacemakers 555 0 2,131 0 0 2,131
Other portable aids 14,142 453 11,985 1,260 1,869 37,751
THERAPEUTIC APPLIANCES 7,064 3,377 5,329 17,846 13,752 12,808
Mechano-therapy apparatus 1,971 1,558 2,172 14,428 13,357 4,048
Therapeutic respiration apparatus 5,093 1,819 3,157 3,418 395 8,760
OTHER MEDICAL DEVICES 54,530 41,680 58,083 24,994 13,735 98,536
WHEELCHAIRS 335 101 0 4,113 17 408
Wheelchairs, not mechanically 331 69 0 2,475 16 0

propelled
Wheelchairs, mechanically propelled 4 32 0 1,638 1 408
OPHTHALMIC INSTRUMENTS 3,878 3,736 7,054 108 653 9,189
HOSPITAL FURNITURE 1,496 3,620 1,637 4,986 2,708 6,490
MEDICAL, SURGICAL STERILISERS 2,067 2,346 645 843 1,221 4,009
ULTRA-VIOLET OR INFRA-RED RAY 9 59 11 344 111 30

APPARATUS
OTHER INSTRUMENTS & 46,745 31,818 48,736 14,600 9,025 78,410

APPLIANCES
TOTAL 195,708 142,670 141,346 97,755 71,999 325,954
Medical Devices Monthly Imports

Imports increased by 5.1% y-o-y in US dollar terms to USD371.2mn in Q418. Performance was mixed with double-digit increases for
patient aids and dental products, a single-digit rise for diagnostic imaging and contractions for orthopaedics & prosthetics, other
medical devices and consumables.
In the 12 months to December 2018, imports increased by 8.5% in US dollar terms to USD1.1bn. All product areas posted growth,
led by double-digit increases for dental products and patient aids. Other medical devices remained the largest product area,
accounting for over a quarter of imports.
MONTHLY MEDICAL DEVICE IMPORTS BY PRODUCT AREA, YEAR ENDING DECEMBER 2018 (USDMN)
Consumables Diagnostic Dental Orthopaedics Patient Aids Others Total
Quarter to
Dec-17 65.2 76.3 19.8 25.4 55.2 111.3 353.2
Dec-18 64.7 79.4 23.5 23.8 69.6 110.2 371.2
Qtr % +/- -0.7 4.1 18.9 -6.5 26.0 -1.0 5.1
Year to
Dec-17 215.3 230.9 57.5 72.9 168.2 307.0 1,051.8
Dec-18 229.0 240.4 70.5 74.5 202.1 324.6 1,141.1
12 months % +/- 6.4 4.1 22.6 2.1 20.1 5.7 8.5
Medical Devices Annual Exports
Latest Updates
Vietnam has become an increasingly significant base for the manufacture and export of medical equipment. Companies from Japan,
the US and Europe have all begun to establish plants there, to take advantage of low manufacturing costs and this has resulted in
rapid growth in medical device exports over the past decade.
In local currency terms, medical device exports increased by 11.5% to VND15.1trn in 2016. This marked a return to double-digit
growth after a slowdown in 2015. Exports registered a 2011-2016 CAGR of 17.5%, ranging from 9.6% for patient aids up to 43.6%
for dental products.
Medical Device Exports, Local Currency

(2006-2016)
In US dollar terms, exports increased by 9.2% in 2016 to reach USD674.9mn. This increase marks an improvement in export
performance from the modest 3.7% recorded in 2015. Prior to 2015, exports had registered double-digit rises in every year going
back to 2006. Exports increased at a CAGR of 15.7% over the 2011-2016 period, ranging from 7.8% for patient aids up to 41.3% for
dental products.
Despite the growth in domestic production, Vietnam still has an annual trade balance deficit, which widened to USD319.1mn in
2016. All major product areas registered deficits in 2016, apart from consumables where other needles, catheters &
cannulae recorded a significant trade balance surplus, along with smaller surpluses for needles and surgical gloves. Other product
segments to register surpluses in 2016 included other electrodiagnostic apparatus, dental chairs, other dental fittings, hearing aids,
mechanically propelled wheelchairs and hospital furniture.
Medical Device Exports, US Dollar

(2006-2016)
Structural Trends
Consumables is Vietnam's largest export product area, reflecting the strength of the domestic manufacturing industry. Exports of
consumables accounted for 42% of the total in 2016. Other medical devices is the second largest product area accounting for more
than a fifth of the export total, followed by patient aids and diagnostic imaging, both with 15%. Exports of dental products and
orthopaedics & prosthetics each represent less than 5% of the total.
Other medical devices was the best performing product area in 2016, recording an increase of over 80% in both local currency and
US dollar terms. Exports of orthopaedics & prosthetics increased by more than 40% in both local currency and US dollar terms.
Dental products was the only other product area to achieve double-digit growth in 2016, while both diagnostic imaging and
consumables were limited to single-digit growth. Exports of patient aids fell in 2016.
The small dental products sector has been the strongest growth area over the past five years, registering a 2011-2016 CAGR of over
40% in both local currency and US dollar terms. Other medical devices, orthopaedics & prosthetics and diagnostic imaging all
posted CAGRs of over 20%. The only product area not to register double-digit growth over the forecast period was patient aids.
Leading Destinations
In 2016, the US edged ahead of Japan as the leading destination for Vietnamese exports, with shipments valued at USD141.8mn,
equal to 21% of the total. The US was the leading recipient of exports of diagnostic imaging, dental products, orthopaedics &
prosthetics and patient aids.
Japan received shipments valued at USD138.4mn in 2016, equal to just under 21%. Japan was the leading destination for
consumables and other medical device exports.
The EU-28 was the destination for 24% of exports in 2016, with Belgium accounting for 7% and Germany for 6%.
TOP 20 MEDICAL DEVICE DESTINATIONS, 2016 (USD000S)

Country 2016 % Total
1 US 141,821 21.0
2 Japan 138,408 20.5
3 China 73,689 10.9
4 Belgium 43,880 6.5
5 Germany 37,259 5.5
6 Thailand 28,989 4.3
7 Netherlands 24,851 3.7
8 Poland 19,980 3.0
9 UK 17,531 2.6
10 South Korea 15,102 2.2
11 Switzerland 13,806 2.0
12 Hong Kong 13,342 2.0
13 Australia 10,998 1.6
14 Taiwan 10,853 1.6
15 Canada 10,297 1.5
16 India 9,791 1.5
17 Malaysia 8,800 1.3
18 Singapore 8,176 1.2
19 Italy 5,361 0.8
20 Spain 5,128 0.8
Subtotal 638,062 94.5
Others 36,812 5.5
Total 674,874 100.0
DETAILED MEDICAL DEVICE EXPORTS BY PRODUCT AREA, 2012-2016 (USD000S)

2012 2013 2014 2015 2016
CONSUMABLES 216,683 232,858 280,248 272,082 282,422
BANDAGES & DRESSINGS 4,674 5,574 5,111 6,543 8,399
Medical dressings (adhesive) 4,157 3,221 3,934 5,657 7,102
Medical dressings (non-adhesive) 517 2,353 1,177 886 1,297
SUTURING MATERIALS 281 388 533 239 118
SYRINGES, NEEDLES & CATHETERS 211,290 226,831 274,171 260,921 267,462
Syringes (with/without needles) 1,690 3,641 4,251 3,936 3,089
Tubular metal needles/needles for sutures 10,302 11,026 12,124 14,961 16,847
Other needles, catheters, cannulae etc 199,298 212,164 257,796 242,024 247,526
OTHER CONSUMABLES 438 65 433 4,379 6,443
Blood-grouping reagents 0 0 0 6 1
First-aid boxes & kits 0 0 0 33 3
Ostomy products 0 0 0 0 0
Surgical gloves 438 65 433 4,340 6,439
DIAGNOSTIC IMAGING 55,203 58,112 74,865 95,804 101,833
ELECTRODIAGNOSTIC APPARATUS 54,547 55,849 72,646 93,227 99,026
Electrocardiographs 7 7 16 10 153
Ultrasound 106 48 418 55 233
MRI 230 0 0 303 226
Scintigraphic apparatus 0 6 0 0 18
Other electrodiagnostic apparatus 54,204 55,788 72,212 92,859 98,396
RADIATION APPARATUS 33 1,479 1,134 495 397
CT scanners 0 1,304 240 363 89
Other medical X-ray apparatus 33 175 894 125 308
A, B, C ray apparatus 0 0 0 7 0
IMAGING PARTS & ACCESSORIES 623 784 1,085 2,082 2,410
Contrast media 33 67 4 0 0
2012 2013 2014 2015 2016
Medical X-ray film (flat) 78 1 36 941 937
Medical X-ray film (rolled) 0 0 0 0 0
X-ray tubes 304 44 0 109 421
Other imaging parts & accessories 208 672 1,045 1,032 1,052
DENTAL PRODUCTS 8,084 14,485 22,525 27,311 30,936
CAPITAL EQUIPMENT 672 1,527 3,065 3,441 3,217
Dental drills 0 1 2 0 1
Dental chairs 672 1,511 3,058 3,423 3,214
Dental X-ray 0 15 5 18 2
INSTRUMENTS & SUPPLIES 7,412 12,958 19,460 23,870 27,719
Dental cements 1,803 1,880 2,057 2,171 2,327
Dental instruments 3,118 4,723 5,710 6,584 7,374
Teeth & other fittings 2,491 6,355 11,693 15,115 18,018
Artificial teeth 2 29 83 43 171
Other dental fittings 2,489 6,326 11,610 15,072 17,847
ORTHOPAEDICS & PROSTHETICS 6,145 6,806 5,840 6,532 9,505
FIXATION DEVICES 6,012 6,725 5,739 6,297 9,455
ARTIFICIAL JOINTS 0 0 0 0 0
OTHER ARTIFICIAL BODY PARTS 133 81 101 235 50
PATIENT AIDS 88,756 115,243 131,105 132,488 99,266
PORTABLE AIDS 86,589 111,463 126,769 128,359 95,572
Hearing aids 45,571 46,707 49,538 53,764 55,295
Pacemakers 0 0 0 0 0
Other portable aids 41,018 64,756 77,231 74,595 40,277
THERAPEUTIC APPLIANCES 2,167 3,780 4,336 4,129 3,694
Mechano-therapy apparatus 1,664 2,712 1,192 715 361
Therapeutic respiration apparatus 503 1,068 3,144 3,414 3,333
OTHER MEDICAL DEVICES 53,184 62,637 81,327 83,523 150,912
2012 2013 2014 2015 2016
WHEELCHAIRS 10,109 13,358 20,208 27,474 37,233
Wheelchairs, not mechanically propelled 64 456 579 272 229
Wheelchairs, mechanically propelled 10,045 12,902 19,629 27,202 37,004
OPHTHALMIC INSTRUMENTS 2,727 3,666 7,259 9,427 8,222
HOSPITAL FURNITURE 25,632 26,527 33,004 17,080 31,137
MEDICAL, SURGICAL STERILISERS 4 612 356 380 479
ULTRA-VIOLET OR INFRA-RED RAY APPARATUS 4 0 1 26 12
OTHER INSTRUMENTS & APPLIANCES 14,708 18,474 20,499 29,136 73,829
TOTAL 428,055 490,141 595,910 617,740 674,874
DETAILED LEADING MEDICAL DEVICE DESTINATIONS BY PRODUCT AREA, 2016 (USD000S)

US Japan China Belgium Germany EU-28
CONSUMABLES 8,659 100,423 50,323 32,224 25,765 69,450
BANDAGES & DRESSINGS 1,544 0 430 66 7 73
Medical dressings (adhesive) 1,507 0 430 0 7 7
Medical dressings (non-adhesive) 37 0 0 66 0 66
SUTURING MATERIALS 1 0 0 0 0 14
SYRINGES, NEEDLES & CATHETERS 7,114 100,420 49,893 32,158 19,837 63,226
Syringes (with/without needles) 1 1,059 2 0 0 7
Tubular metal needles/needles for 948 6,648 2,636 0 922 3,644

sutures
Other needles, catheters, cannulae etc 6,165 92,713 47,255 32,158 18,915 59,575
OTHER CONSUMABLES 0 3 0 0 5,921 6,137
Blood-grouping reagents 0 0 0 0 0 0
First-aid boxes & kits 0 3 0 0 0 0
Ostomy products 0 0 0 0 0 0
Surgical gloves 0 0 0 0 5,921 6,137
DIAGNOSTIC IMAGING 38,144 838 567 7 184 27,203
ELECTRODIAGNOSTIC APPARATUS 38,121 571 7 7 45 27,062
Electrocardiographs 23 11 0 7 0 73
Ultrasound 0 0 0 0 2 5
MRI 144 0 0 0 7 56
Scintigraphic apparatus 0 0 0 0 2 2
Other electrodiagnostic apparatus 37,954 560 7 0 34 26,926
RADIATION APPARATUS 0 134 0 0 0 0
CT scanners 0 86 0 0 0 0
Other medical X-ray apparatus 0 48 0 0 0 0
A, B, C ray apparatus 0 0 0 0 0 0
IMAGING PARTS & ACCESSORIES 23 133 560 0 139 141
Contrast media 0 0 0 0 0 0
Medical X-ray film (flat) 0 0 560 0 0 0
Medical X-ray film (rolled) 0 0 0 0 0 0
X-ray tubes 21 79 0 0 130 130
Other imaging parts & accessories 2 54 0 0 9 11
DENTAL PRODUCTS 19,164 2,785 2,414 0 128 1,043
CAPITAL EQUIPMENT 1,164 41 0 0 17 89
Dental drills 0 0 0 0 0 0
Dental chairs 1,164 41 0 0 17 89
Dental X-ray 0 0 0 0 0 0
INSTRUMENTS & SUPPLIES 18,000 2,744 2,414 0 111 954
Dental cements 112 14 0 0 6 588
Dental instruments 82 2,717 2,414 0 57 191
Teeth & other fittings 17,806 13 0 0 48 175
Artificial teeth 0 11 0 0 41 156
Other dental fittings 17,806 2 0 0 7 19
ORTHOPAEDICS & PROSTHETICS 8,583 0 0 18 471 710
FIXATION DEVICES 8,583 0 0 18 470 709
ARTIFICIAL JOINTS 0 0 0 0 0 0
OTHER ARTIFICIAL BODY PARTS 0 0 0 0 1 1
PATIENT AIDS 40,589 1,434 4,247 248 1,551 23,165
PORTABLE AIDS 40,486 1,201 4,203 248 1,539 21,915
Hearing aids 23,536 835 3,898 142 1,297 11,135
Pacemakers 0 0 0 0 0 0
Other portable aids 16,950 366 305 106 242 10,780
THERAPEUTIC APPLIANCES 103 233 44 0 12 1,250
Mechano-therapy apparatus 20 233 5 0 11 18
Therapeutic respiration apparatus 83 0 39 0 1 1,232
OTHER MEDICAL DEVICES 26,682 32,928 16,138 11,383 9,160 39,135
WHEELCHAIRS 18,459 182 56 598 4,658 15,306
Wheelchairs, not mechanically propelled 0 0 0 0 0 0
Wheelchairs, mechanically propelled 18,459 182 56 598 4,658 15,306
OPHTHALMIC INSTRUMENTS 465 4,819 263 0 39 1,245
HOSPITAL FURNITURE 231 23,930 450 1,120 261 5,227
MEDICAL, SURGICAL STERILISERS 0 0 0 0 2 404
ULTRA-VIOLET OR INFRA-RED RAY 0 0 8 0 0 0

APPARATUS
OTHER INSTRUMENTS & APPLIANCES 7,527 3,997 15,361 9,665 4,200 16,953
TOTAL 141,821 138,408 73,689 43,880 37,259 160,706
Medical Devices Monthly Exports

Exports increased by 44.4% y-o-y in US dollar terms to USD482.2mn in Q418. Every product area registered double-digit growth
except for diagnostic imaging, which posted a single-digit increase.
In the 12 months to December 2018, exports increased by 26.5% in US dollar terms to USD1.6bn. All product areas recorded
double-digit growth, except for diagnostic imaging, which contracted. Other medical devices remained the largest product area,
representing almost 40% of total exports.
MONTHLY MEDICAL DEVICE EXPORTS BY PRODUCT AREA, YEAR ENDING DECEMBER 2018 (USDMN)
Consumables Diagnostic Dental Orthopaedics Patient Aids Others Total
Quarter to
Dec-17 75.8 9.1 16.1 11.4 88.3 133.4 334.0
Dec-18 94.9 9.7 18.6 15.1 166.5 177.5 482.2
Qtr % +/- 25.2 6.8 15.5 32.5 88.6 33.0 44.4
Year to
Dec-17 283.6 47.9 55.9 42.9 326.3 524.3 1,280.8
Dec-18 352.1 43.9 66.7 50.1 478.2 628.7 1,619.6
12 months % +/- 24.2 -8.4 19.3 16.8 46.5 19.9 26.5
Industry Risk/Reward Index

Medical Devices Industry Risk/Reward Index
Key View
• Asia Pacific is the second most attractive region in our Medical Devices Rewards Index.
• Japan, China and South Korea offer the highest Rewards, supported by large market sizes, high production and large
populations.
• Conversely, Bangladesh and Pakistan have the lowest Rewards, hindered by very low per capita spending, resulting in
disproportionately small markets for the large but predominantly rural populations.
Asia Pacific: Developed Markets Top Performers

Asia Pacific Medical Devices Risk/Reward Index Heat Map
Scores Out of 100. Higher Score = Lower Risk. Source: Fitch Solutions Medical Devices Risk/Reward Index
Main Regional Features & Latest Updates
• Asia Pacific outperforms globally within our Medical Devices Rewards Index. The region benefits from two of the world's five
largest markets in Japan and China and high market growth in several emerging markets, which support above average Industry
Rewards. In addition, a large population of more than half of the global total, including an elderly population of 300mn, coupled
with relatively high population growth in Emerging Asia, Australia and Singapore feed into above average Country Rewards.
• Developed markets outperform emerging markets on most Medical Devices Rewards components, driven by high per capita
spending, established medical device manufacturing, a high rate of urbanisation and sizeable elderly populations. Emerging
markets have the edge in terms of overall population size, population growth and market growth, indicating higher long-term
potential.
• As Asia Pacific's largest market, Japan ranks first in the region for Medical Devices Rewards, driven by above average scores on
most Reward components with the notable exceptions of market growth and population growth. In second place, China’s score
is boosted by strong Industry Rewards, offset by below average Country Rewards, despite the huge population. South Korea
occupies third position supported by above average scores for both Industry Rewards and Country Rewards.
• Bangladesh and Pakistan are the least attractive markets in our Asia Pacific Medical Devices Rewards Index. Both markets
have very low per capita spending, due to large populations, limiting the market size, which hinder their Industry Rewards.
Bangladesh and Pakistan also have large rural populations hampering access to healthcare and predominantly youthful
populations, which limit demand for healthcare, resulting in below average scores for Country Rewards.
Asia Pacific High Potential

Asia Pacific Medical Devices Risk/Reward Index
Scores out of 100. Higher Score = Lower Risk. Source: Fitch Solutions Medical Devices Risk/Reward Index
Outperformers: Japan, China And South Korea Top Asia Pacific Rewards
• Japan tops our Asia Pacific Medical Devices Rewards Index. The country's leading position is bolstered by a particularly strong
score for Industry Rewards, which reflects the large market size, the strong domestic manufacturing industry and high per capita
spending, despite strong emphasis based on cost-containment. These factors more than outweigh the low market growth. Japan
also leads the Index for Country Rewards due to its high rate of urbanisation and its large and rapidly ageing population.
• China occupies the second position in our Asia Pacific Medical Devices Rewards Index. The country's Industry Rewards score is
driven by the medical market size, which is the second largest in Asia Pacific. This counterbalances low medical device per capita
spending. The score is further boosted by the rapidly expanding medical device industry, which is reducing import reliance, and
above average market growth. Conversely, China's Country Rewards score is below the regional average due to the low level of
urbanisation, a relatively youthful demographic profile and below average population growth, which offset the very large
population
• South Korea ranks third in our Asia Pacific Medical Devices Rewards Index. The country scores above average on all Industry
Rewards components, apart from market growth, having the third largest market in the region and a strong medical device
industry, particularly for diagnostic imaging and dental products. South Korea also scores above average for Country Rewards,
despite low population growth. The country is highly urbanised, with around half of the population living in or near the capital of
Seoul, one of the largest cities in the world. The score for pensionable population is above the global average and will increase
due to rapidly ageing demographics.
Large Markets Tempered By Low Growth In Japan

Japan, China, South Korea And Asia Pacific Average Medical Devices Industry Rewards Scores
Scores out of 100. Higher Score = Higher Reward. Source: Fitch Solutions Medical Devices Risk/Reward Index
Underperformers: Pakistan And Bangladesh Offer Weakest Rewards
• Bangladesh is the least attractive market in our Asia Pacific Medical Devices Rewards Index. The country has the smallest
market in the region and the lowest per capita spending, although the Industry Rewards score is boosted by one of the highest
market growth rates. The Country Rewards score is also below average hindered by the large rural population, hampering access
to healthcare, and the predominantly youthful demographic profile. These factors counterbalance the overall size of the
population and above average population growth rate, which indicate long term potential.
• Pakistan has the second lowest position in our Asia Pacific Medical Devices Rewards Index. The country occupies bottom
position for Industry Rewards hindered by very low per capita spending, resulting in a disproportionately small market for the
population size. Moreover, the domestic industry is geared towards exports and focuses mainly on surgical instruments, leaving
the domestic market heavily import-reliant. Pakistan also scores below average for Country Rewards despite its large and rapidly
expanding population due to the fact that less than 40% of inhabitants reside in urbanised areas, leaving the market highly
fragmented. The comparatively small elderly population also limits market potential in some product areas.
Bangladesh And Pakistan Offer Poor Industry Rewards

Bangladesh, Pakistan And Asia Pacific Average Medical Devices Rewards Scores
Asia Pacific: Japan, Singapore, South Korea And Taiwan Score In Global Top-15
Asia Pacific Medical Devices Risk/Reward Index
Asia Pacific: Japan, China and South Korea Offer Highest Rewards
Asia Pacific Medical Devices Industry And Country Rewards Scores
Asia Pacific: Pakistan And Bangladesh Pose Highest Risks

Asia Pacific Medical Devices Industry And Country Risks Scores
Market Overview
Medical Devices Overview
• Ninth largest market in the APAC region.
• Per capita spending is well below the APAC average.
• One of the fastest growing markets in the region
• Diagnostic imaging and other medical devices have the largest market shares.
• Imports supply over 90% of the market.
• Domestic production is limited to basic items.
• Some multinationals have set up plants, attracted by low manufacturing and labour costs.
• Ongoing healthcare infrastructure plans for hospitals and primary care facilities ensure demand.
MEDICAL DEVICE MARKET, KEY RATIOS, 2018

2018
Market size (USDmn) 1,277.3
% health expenditure 7.4
% GDP 0.5
% world market 0.3
% supplied by imports 91.2
% projected CAGR 9.9
Per capita (USD) 13.2
MEDICAL DEVICE MARKET BY PRODUCT AREA, 2018
Total (Local Per Capita

Total % Total Per Capita
Currency (Local
(USDmn) Market (USD)
mn) Currency)
Consumables 183.2 14.3 1.9 4,232,047.1 43,859.4
Diagnostic imaging 372.8 29.2 3.9 8,612,423.6 89,256.1
Dental products 51.3 4.0 0.5 1,185,909.7 12,290.3
Orthopaedics & prosthetics 115.9 9.1 1.2 2,676,142.6 27,734.6
Patient aids 195.3 15.3 2.0 4,510,558.2 46,745.8
Total (Local Per Capita

Total % Total Per Capita
Currency (Local
(USDmn) Market (USD)
mn) Currency)
Other medical devices 358.8 28.1 3.7 8,288,887.2 85,903.1
Total 1,277.3 100.0 13.2 29,505,968.5 305,789.4
Healthcare Overview
Health Status
Using data from the UN Population Division, we estimate that Vietnam's population has grown at a CAGR of 1.1% over the last five
years to total 96.5mn in 2018. The proportion of the population aged 65 and over is low, but is steadily increasing, having reached
7.4% in 2018. We estimate that life expectancy in 2018 was 72.0 years for males and 81.2 years for females.
Based on UN data, we estimate that:
• The birth rate has decreased at a CAGR of 1.3% over the 2013-2018 period, reaching 16.2 per thousand population in 2018;
• The death rate has increased at 2013-2018 CAGR of 0.3% to 5.9 per thousand population in 2018, but remains below the
regional and global average; and
• The infant mortality rate is high, but improving, having fallen by a 2013-2018 CAGR of 2.9% to 16.4 per 1,000 live births in 2018.
Like many developing countries with relatively poor healthcare provision, Vietnam has a substantial burden of communicable
diseases. Additionally, the burden of chronic diseases in Vietnam is rising even as the country sees a significant fall in the burden of
communicable conditions. Between 2016 and 2030, our Disease Database projects the number of disability-adjusted life years
(DALYs) lost to chronic conditions will rise by 38%, while the number of DALYs lost to communicable diseases will fall by 20%. Despite
the decrease in communicable diseases, the burdens of both communicable and non-communicable disease are still fairly
balanced, stressing the need to finance healthcare services for both infectious and non-infectious diseases. Leading contributors to
Vietnam's overall burden include diabetes, cardiovascular conditions and cancer.
According to the International Diabetes Federation, Vietnam had an estimated 3.5mn diagnosed adult cases of Type II diabetes in
2017, equal to a national prevalence of 5.5%. Undiagnosed cases were estimated at a further 1.9mn, meaning more than half of all
diabetics remain undiagnosed. The number of diagnosed adult cases is forecast to rise to 6.2mn by 2045.
According to the International Agency for Research on Cancer (IARC), there were 164,671 new cases of cancer in Vietnam in 2018,
equal to an ASR of 151.4 per 100,000 population, which is below the global average, although the rate in males is much higher than
females at 186.7, compared to a South East Asian average of 156.1. Liver cancer is the most frequent type of cancer, with Vietnam
having the fourth highest rate in the world, due to heavy smoking and high alcohol consumption, particularly among men. Lung
cancer is the second most frequent cancer, followed by stomach, breast and colorectal cancer. The annual number of new cancer
cases is forecast to grow at a CAGR of 2.5% to reach 285,347 in 2045.
Healthcare System
Organisation
Vietnam's healthcare system has struggled to keep pace with population growth and the rising demands of a population with an
increasing amount of disposable income to spend on healthcare. Hospitals in urban areas suffer from serious overcrowding, rural
hospitals lack qualified healthcare personnel, and throughout the country, many facilities are in need of modernisation and re-
equipping. The organisation of health services in Vietnam is arranged around several tiers. Being a Communist country, Vietnam has
a strong system of local government organisation, based on villages, communes, districts and provinces. The Ministry of Health
(MoH) is responsible for drawing up and administering health policy at national level.
Each of the 53 provinces has its own Health Service Office reporting to the local People's Council, which is responsible for drawing
up and administering health policies at provincial level. Provincial Health Service Offices are supported by the district offices.
Provincial hospitals provide the most specialist care available outside the major cities, and act as referral centres for cases from
district hospitals. District health centres and hospitals are responsible for co-ordinating health programmes and for the provision of
basic secondary services throughout the district. At village level, only the most basic services are provided, by community health
workers who come primarily from large international organisations. At the next level, communes are equipped in most cases with at
least one health centre and a small medical staff, although such centres rarely have much in the way of equipment or specialist
supplies.
The public healthcare sector is the dominant provider of care. The vast majority of public hospitals are administered by the district
and provincial health service offices. Government funding for hospitals is provided by the Ministry of Finance via provincial finance
offices, which transfer a fixed budget to the provincial health service offices for distribution to both provincial hospitals and district
health offices. These in turn allocate funds to district hospitals.
The private healthcare sector in Vietnam has expanded since the lifting of the ban on private practice in 1989. Ho Chi Minh City has
a large, if poorly regulated, private clinic sector. People often choose to use private facilities, if they can afford to do so, as the quality
of state healthcare provision is very poor. Around 40,000 Vietnamese people travel abroad for medical treatment per year and to
counter this, the government aims to have privately run hospitals account for 20% of total hospitals in the country by 2020.
Private Healthcare Providers
French and US companies are the dominant foreign players running private hospitals, while companies based in Thailand
(Bumrungrad Hospital), Indonesia (Lippo Group), Malaysia (IHH Healthcare, KPJ Healthcare) and Singapore (Parkway Holdings) are
currently setting up operations or have expressed an interest in establishing facilities.
Hoan My Medical Corporation
The country's leading private healthcare provider is Hoan My Medical Corporation. Hoan My was the first company to establish a
private hospital chain in Vietnam. The group runs five hospitals and four clinics in Ho Chi Minh City, Dalat, Danang, Can Tho and Minh
Hai with a total of around 1,000 beds, providing healthcare to over 1.0mn people. Fortis Healthcare acquired a 65% stake in August
2011, but sold it in June 2013 to Singapore-based Chandler Corporation, which has since increased its holding to 80%.
Vinmec
The Vinmec International Hospital, located in Hanoi, is described as Vietnam's first international hospital catering to Vietnamese and
overseas patients. The acute general hospital provides a full range of services and has 273 beds, all in single rooms. In April 2014,
Vinmec opened the Vinmec International Clinic at the Vincom Center Dong Khoi to establish the first Vinmec facility in Ho Chi Minh
City.
National Policies
Vietnam Health Programme
In September 2018, the Prime Minister, Nguyễn Xuân Phúc, approved the Vietnam Health Programme (2018-2030) to improve the
well-being, stature, lifespan and quality of life of the population. The programme sets three goals:
• Promote a healthy diet and lifestyle with appropriate nutrition and increased physical activity to improve Vietnamese people’s
stature and well-being.
• Raise public awareness for behavioural change to protect health and prevent health-related risks.
• Provide constant and long-term primary healthcare services to reduce the burden of illness on the community and enhance
people’s quality of life.
To achieve these goals, the government will focus on reducing dependence on tobacco and alcohol; ensure environmental
sanitation and food safety; and foster the early detection and management of a number of non-communicable diseases.
International Aid
World Bank Projects
The World Bank has a number of active projects in the field of health, including:
• Health Professionals Education and Training for Health System Reforms, to improve the quality of health professional's
education, strengthen management competencies in the health sector, and improve the competencies of primary healthcare
teams at the grass-roots level. Approval date: May 6 2014. Closing date: December 31 2020. Total project cost: USD121.0mn.
• North East and Red River Delta Regions Health System Support Project, to increase the efficiency and equity in the use
of hospital services in selected provinces of the North East and Red River Delta regions. Approval date: May 31 2013. Closing
date: December 31 2019. Total project cost: USD154.0mn.
• Hospital Waste Management Support Project, to reduce environmental degradation and potential risks for human health
through the improved management of healthcare waste in Vietnam's hospitals. Approval date: March 29 2011. Closing date:
August 31 2017. Total project cost: USD155.0mn.
EU Funding For Health Sector Reform
On December 4 2014, the EU entered a financial agreement with Vietnam to fund EUR114mn (USD141mn) for the second phase
of the EU Health Sector Policy Support Programme (EU-HSPSP-2) in the country. The agreement aims to support Vietnam in
restructuring its health sector and implementing reform plans between 2015 and 2017. The EU-HSPSP-2 aims to reduce
sustainable poverty and create harmonious growth in country's healthcare sector. The programme will also contribute towards the
development of healthcare plans for the 2016-2020 period, with a focus on accelerating the coverage of healthcare services
nationwide and improving the quality of services.
Healthcare Funding
Health Insurance
In October 2009, a law took effect that made health insurance compulsory for all citizens. The government's aim was for 75% of the
population to have health insurance by the end of 2015, with this figure rising to 80% in 2020. As of July 2015, 71.4% of the
population had health insurance. The MoH found that uptake was being hindered by several provinces and cities not including the
health insurance targets in their socio-economic development programmes, administrative procedures for purchasing health
insurance proving to be troublesome, people lacking information on the health insurance options available, and numerous
enterprises delaying or avoiding their responsibility for purchasing health insurance for their employees. In 2015, the MoH
estimated that around 49% of employees did not have health insurance coverage.
In January 2015, a revision to the Law on Health Insurance took effect that brought more benefits to the poor and ethnic minorities;
100% of their hospital fees at both local and central hospitals are now covered by health insurance. A further amendment that
came into effect in January 2016 allows people with health insurance cards to specify the health facility that they would prefer to
attend for health examinations or treatment within their own district, without the requirement for referral papers as before. The
main objective of the law is to give people better access to healthcare services. The amendment has led to an increase in the
number of people using facilities at district or precinct level; in the first month of 2016, the number increased by 150% compared
with the same period in 2015.
Upon the opening of the Vietnamese 4th plenary session in October 2017, the government put forward a target of 85.2% health
insurance coverage in 2018 under its plans towards attaining universal health insurance. Coverage of school pupils and students is
already higher, at 92.5% in 2016-2017, claims the Ministry of Education and Training, although this means that 1.5mn young people
are still uninsured. By 2025, Vietnam aims to have achieved 95% coverage.
In July 2017, the Ministry of Health and Vietnam Social Security signed an agreement with the Japanese International Cooperation
Agency (JICA) to develop and strengthen the management of the health insurance system. Under a two-year project, JICA will
provide expertise to assist with identifying an optimal provider payment method and develop a benefit package.
Health Expenditure
Based on data from the World Health Organization (WHO), we estimate that Vietnam spent 6.0% of GDP on healthcare in 2018,
equal to USD14.5bn. Per capita spending was low at USD150, but this has risen sharply since 2002, when it stood at only USD23.
Vietnam has a huge unmet need for healthcare, and continued major investment is needed, just to prevent the hospital sector from
being overwhelmed.
Health expenditure was evenly divided between the public and private sectors in 2018. Out-of-pocket spending represents over
80% of private expenditure.
Healthcare Resources
Infrastructure
We estimate that Vietnam had 1,304 hospitals in 2018, 1,094 of which were in the public sector. The number of private hospitals is
low, but increased to 210 in 2018. The number of beds increased by a 2013-2018 CAGR of 2.5% to 255,702 beds in 2018, equal to
2.7 per thousand population. The government aims to have 3.0 hospital beds per thousand population by 2025.
Hospital Developments
The signing of investment deals totalling more than USD200mn with Israeli companies should provide a significant boost to
Vietnam's medical device market. The two countries are currently negotiating a free trade agreement, Vietnam's first with a Middle
Eastern nation, under a process started in December 2015.
In March 2017, the Israeli Jasmine Group and the Vietnamese real estate company Dat Vang signed a memorandum of
understanding (MoU) for a USD200mn financial package to finance the development of two healthcare projects in Ho Chi Minh City.
Specialising in infrastructure and healthcare technology, Jasmine Group has agreed to assist Dat Vang in purchasing medical
equipment and building healthcare facilities.
Also in March 2017, Israel's MedicDan Ltd. and Sraromedic R.N. International signed an agreement with Vietnamese dairy producer
TH Group to develop a high-tech medical complex in Hanoi, including a 5-star 300-bed general hospital and nursing and
rehabilitation centre.
Other large investments in Vietnam's hospital sector include:
• In September 2016, US life sciences investor Quantus signed a Memorandum of Understanding (MoU) with Saigon Hi-Tech Park
(SHTP) to develop a USD500mn hospital and medical research centre. The project will cover a seven hectare site, containing the
25-storey hospital, a 12-storey science institute and a shopping centre. According to Quantus, the hospital will feature several
advanced technologies and devices such as proton therapy and gamma-ray treatment for cancer, new neurosurgical
approaches, helicopter services, an advanced stem cell cardiology unit, and a state-of-the-art orthopaedic surgical unit. With its
advanced facilities, the hospital is expected to attract patients from abroad. The project will be carried out in two phases. Half of
the investment will be spent on building the hospital and research institute, with completion scheduled for July 2018. The
second phase will involve the equipping of the two facilities. Project partners will include Allied Telesis KK for information
technology in healthcare services, Stanford Hospital for doctor training and exchange programmes, and the University of
California for research fellowship programmes through the life science institute.
• On October 10 2016, JSC Trans-Asia Investment Hospital held a groundbreaking ceremony for the construction of its new Vinh
Long Xuyen Hospital in the city of Vinh Long. The hospital development will command a total investment of VND850bn
(USD38mn). It will have a usable area of 40,000 square metres over 10 floors. It was expected to be providing medical care by
late 2017. The hospital will be able to receive 2,000 outpatient visits and 800 inpatient admissions every day. Specialties provided
will include cardiovascular interventions, neurology, thoracic surgery, oncology, orthopaedics, urology, general surgery, renal care
and paediatrics.
Emergency Services Expansion
In December 2016, the Ministry of Health issued a decree stipulating that an emergency care centre should be available at least
every 50 km along Vietnam's highways. The coverage will be achieved either by building new emergency centres or by adding
emergency wards to existing medical establishments along the routes. In addition, the decree states that there should be one
ambulance for every three emergency centres.
Vietnam has 13 highways with a total length of 745km, eight under construction with a total length of 472km and plans to build a
further 21 highways with a total length of 6,411km. Once the network is completed, 153 emergency centres would be required to
meet the demands of the decree.
Healthcare Activity
Vietnam is seeing a steady rise in healthcare activity with the number of patients treated outpacing population growth as access to
healthcare services gradually improves. That said, activity levels remain below average within the Asia region. We estimate that
inpatient admissions grew by a 2013-2018 CAGR of 2.2%, reaching 5.6mn in 2018, equal to 58 per thousand population, which is
well below the Asia and global average. The number of surgical procedures grew at a similar rate, reaching almost 1.9mn procedures
in 2018. We estimate that outpatient visits also increased by a 2013-2018 CAGR of 2.2% to 156.4mn in 2018, equal to 1,619 per
thousand population which is well below the Asia and global average.
Healthcare Personnel
Vietnam has low healthcare staffing levels by global standards, although numbers are increasing rapidly. We estimate that the
number of public sector physicians stood at 78,926 in 2018, equal to a rate of 0.8 per thousand population. There were 128,386
public sector nurses in 2018, equal to 1.3 per thousand population, and 9,659 dentists, equivalent to 0.1 per thousand population.
The government aims to have 1.0 doctor and 2.5 nurses per thousand population by 2025.
Key Healthcare Data
KEY HEALTHCARE DATA, 2013-2018

Health Status 2013 2014 2015 2016 2017 2018 CAGR
Population (mn) 91.5 92.5 93.6 94.6 95.5 96.5 1.1
Population growth (%) 1.2 1.1 1.1 1.1 1.0 1.0 -3.0
% of population aged 65+ 6.6 6.6 6.7 6.9 7.1 7.4 2.5
Live Births (000s) 1,582.7 1,584.2 1,581.8 1,576.7 1,570.4 1,563.7 -0.2
Per 000 population 17.3 17.1 16.9 16.7 16.5 16.2 -1.3
Deaths (000s) 528.4 535.6 542.7 549.9 557.2 564.8 1.3
Per 000 population 5.8 5.8 5.8 5.8 5.8 5.9 0.3
Infant mortality/000 live births 19.0 18.4 17.9 17.3 16.8 16.4 -2.9
Male life expectancy at birth 70.8 71.1 71.3 71.5 71.8 72.0 0.3
Female life expectancy at birth 80.4 80.6 80.7 80.9 81.0 81.2 0.2
Healthcare Funding 2013 2014 2015 2016 2017 2018 CAGR
Health Expenditure (USDbn) 11.5 11.6 11.7 12.0 13.7 14.5 4.7
Per capita (USD) 125.7 125.7 125.2 126.4 143.7 150.2 3.6
Health expenditure % of GDP 6.7 6.3 6.1 5.9 6.2 6.0 -2.2
Public % of health expenditure 51.8 51.5 50.2 51.7 48.1 48.8 -1.2
Social security % of public n/a n/a n/a n/a n/a n/a n/a
Private % of health expenditure 48.2 48.5 49.8 48.3 51.9 51.2 1.2
Out of pocket % of private 80.4 79.4 80.6 87.9 n/a n/a n/a
Private insurance % of private n/a n/a n/a n/a n/a n/a n/a
Exchange rate, national currency/USD 21,029.0 21,198.9 21,919.0 22,366.1 22,715.5 23,020.2 1.8
Healthcare Resources 2013 2014 2015 2016 2017 2018 CAGR
Hospitals 1,234 1,228 1,240 1,248 1,285 1,304 1.1
Public 1,069 1,063 1,071 1,077 1,085 1,094 0.5
Private 165 165 169 171 200 210 4.9
Health Status 2013 2014 2015 2016 2017 2018 CAGR
Beds 225,999 236,915 247,965 250,608 253,183 255,702 2.5
Per 000 population 2.5 2.6 2.7 2.7 2.7 2.7 1.4
Healthcare Activity 2013 2014 2015 2016 2017 2018 CAGR
Inpatient admissions (000s) 5,011.4 5,126.8 5,241.2 5,353.5 5,464.1 5,585.0 2.2
Per 000 population 54.8 55.4 56.0 56.6 57.2 58.0 1.2
Average length of stay (days) 6.9 6.8 6.8 6.8 6.7 6.7 -0.5
Surgical procedures (000s) 1,670.5 1,708.9 1,747.1 1,784.5 1,821.4 1,862.0 2.2
Outpatient visits (000s) 140,319.6 143,549.9 146,752.5 149,898.0 152,994.3 156,381.0 2.2
Per 000 population 1,533.6 1,551.1 1,568.3 1,585.1 1,601.4 1,619.0 1.1
Healthcare Personnel 2013 2014 2015 2016 2017 2018 CAGR
Physicians (excl. private) 68,600 72,000 74,000 75,655 76,433 78,926 2.8
Per 000 population 0.7 0.8 0.8 0.8 0.8 0.8 1.8
Nurses (excl. private) 98,300 102,000 103,000 111,865 121,494 128,386 5.5
Per 000 population 1.1 1.1 1.1 1.2 1.3 1.3 4.4
Dentists 9,150 9,254 9,357 9,457 9,554 9,659 1.1
Per 000 population 0.1 0.1 0.1 0.1 0.1 0.1 0.0
Source: National Statistics, WHO, Fitch Solutions
Industry Trends And Developments

Medical Devices Industry Trends And Developments
Strong Diplomatic Network Expansion Momentum To Continue
We expect Vietnam to continue pressing ahead with its efforts to expand and strengthen its diplomatic network with countries both
within and outside of the region. While Vietnam’s move to grow its diplomatic ties was partly motivated by security concerns
stemming from an increasingly assertive China in the South China Sea, the establishment of stronger ties is also in line with its
liberal trade policies. We remain steadfast in our view that Vietnam’s diplomatic efforts will support a rise in foreign direct investment
(FDI) inflow over the coming years, which bodes well for the country’s goal of becoming a global manufacturing powerhouse.
Vietnam To Remain Regional Outperformer Although Economic Growth Likely To Slow
The General Statistics Office of Vietnam reported that real GDP growth came in at 6.8% y-o-y in Q119. This would mark a slowdown
from 7.3% y-o-y in Q418. We at Fitch Solutions maintain our forecast for real GDP growth to slow to 6.5% in 2019, from 7.1% in
2018, as we expect weaker external demand on the back of slowing global growth to weigh on Vietnam’s manufacturing activity. To
be sure, a growth rate of 6.5% means that Vietnam will remain an outperformer in Asia and ahead of the Chinese economy, which
we forecast to grow by 6.2% in 2019. Despite our view for manufacturing growth to slow, we still expect the sector to remain a key
contributor to growth over the coming quarters. Other key drivers of growth will likely be the construction sector and the broad
services sector.
Healthcare Market To Benefit From ADB Investment
Vietnam's healthcare market is set to benefit from an Asian Development Bank funding package aimed at improving
healthcare service quality which will support the government as it implements reforms aimed at attaining universal health coverage.
In December 2018, the Asian Development Bank (ADB) approved a financial assistance package of USD100.6mn to support
Vietnam’s effort to improve healthcare service quality, especially in poor and border areas. The package includes a USD88.6mn
policy-based loan to provide budget support for the Ministry of Health to implement complex nationwide reforms in key areas such
as public investment governance, health service delivery and workforce capacity improvement in local healthcare systems. A
USD12mn non-refundable aid package will complement those reforms by piloting healthcare service delivery models in 12 districts
in six provinces with high rates of poverty and poor healthcare security. Gerard Servais, ADB Senior Health Specialist stated that ‘the
programme was part of ADB’s coordinated effort to help Vietnam’s government achieve universal health coverage, including access
to essential healthcare services.’
Like many of its Asian neighbours, Vietnam is attempting to achieve universal healthcare access through the implementation of a
comprehensive health insurance system. This commitment to roll out universal healthcare has the potential to reshape the sector,
with significant implications for medical device companies and healthcare providers. A target set by a resolution of the 6th Plenum
of Communist Party of Vietnam states that by 2025 about 95% of the Vietnamese population will be covered by the national health
insurance scheme. The government is also aiming that by 2025, the direct healthcare cost on each household will be 35% lower
than the current cost. Moreover, by 2030, the country hopes to raise average life expectancy to 75 years, with at least 68 years of
healthy life.
Access to healthcare will remain a key challenge for companies seeking to capture the commercial prospects in Vietnam as the
population is highly ruralised; just 33.6% live in urban areas. Patients continue to face challenges over medical access and rising out-
of-pocket healthcare costs. Moreover, there are large regional variations with regards to the number of healthcare facilities, doctors
and beds between the rural and urban regions of the country, which exacerbates these access issues. For example, the Phu Yen
province was reported to have 54 doctors per 100,000 people in 2014, less than half the number in urban Ho Chi Minh City, which
had 104 physicians per 100,000.
Given the dissatisfaction with the underperforming and underfunded public healthcare sector, the private healthcare sector will see
significant growth in coming years. The long-term rise of household incomes will also provide a boon for private hospitals which
generate a substantial amount of their revenues from out-of-pocket payments. The number of private hospitals has grown
substantially over the past decade and 200 investment projects in hospitals have been approved. The government also wants to
develop private healthcare, with the aim to have privately run hospitals account for 20% of total hospitals in the country by 2020.
French and US companies are the dominant foreign players running hospitals, while companies based in Thailand (Bumrungrad
Hospital), Indonesia (Lippo Group), Malaysia (IHH Healthcare, KPJ Healthcare) and Singapore (Parkway Holdings) are currently setting
up operations or have expressed an interest in establishing facilities. These private healthcare players anticipate strong growth
within the sector, and we view this as a major driver behind total healthcare market growth.
Regional Economic Outperformance Will Support Continued Strong Import Growth
We expect imports to continue on their strong growth trajectory in 2019, supported by Vietnam's continuing regional economic
outperformance, rising healthcare expenditure and expansion of national health insurance coverage and other healthcare
programmes.
The latest monthly mirror trade data reveal that imports increased by 5.1% y-o-y in US dollar terms to USD371.2mn in Q418 and
grew by 8.5% y-o-y to USD1.1bn for the 12 month period ended December 2018.
Annual trade data from UN Comtrade shows that imports increased by 23.1% in local currency terms to VND22.2trn in 2016 and
grew by 20.7% in US dollar terms to USD994.0mn. The 2011-2016 CAGR stood at 12.6% in local currency terms and 10.8% in US
dollar terms.
Expanding Production To Support Export Growth
Exports will continue to see sustained growth in 2019, as foreign companies increase their local manufacturing activity. The growing
number of free trade agreements, including the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP),
which entered into force for Vietnam in January 2019, will provide a further boost to exports.
The latest monthly mirror trade data reveal that exports increased by 44.4% y-o-y to USD482.2mn in Q418 and by 26.5% y-o-y to
USD1.6bn for the 12 month period ended December 2018.
Annual trade data from UN Comtrade shows that exports increased in local currency terms by 11.5% to VND13.5trn in 2016 and
grew in US dollar terms by 9.2% to USD674.9mn. The 2011-2016 CAGR stood at 17.5% in local currency terms and 15.7% in US
dollar terms.
Japanese Investment And Trade Liberalisation To Drive Medical Device Manufacturing
Terumo's plans to double its manufacturing capacity will strengthen its presence in the global interventional therapeutics market
and consolidate its role as one of the leading players in Vietnam's expanding medical device manufacturing sector. Closer economic
ties with Japan will likely see a shift in Japanese foreign direct investment (FDI) away from China to Vietnam, which has a much
cheaper operating environment. Vietnam will also benefit from moves to further open up its economy and liberalise its trade, which
will underpin robust growth in export-oriented manufacturing.
Terumo is planning to construct a new building to house its third manufacturing facility in Vietnam. It expects construction to be
completed in December 2020. The company will also install additional production facilities to increase production at the current
first and second buildings. The investment will total approximately JPY15bn (USD134.2mn) over five years, and as a result of the
investment, production capacity is expected to double. The Vietnamese factory, which started its operation in 2008, mainly
produces products for interventional therapeutics, which it ships to Europe, South America and Asia, including China and India.
Terumo anticpates that the interventional therapeutics market will grow rapidly, especially in China and India, and Tintends to
develop a production system that can meet demands in those regions.
We note that Japan is one of a number of countries with which Vietnam is seeking closer economic co-operation as it looks to
solidify its global relationships and attract more FDI. Indeed on February 27, Vietnam's Prime Minister, Nguyen Xuan Phuc, hailed an
initiative from the Japan Chamber of Commerce and Industry to shift Japanese investment to Vietnam and other Mekong River
nations. In return, Vietnam would provide favourable conditions for Japanese groups and companies to do business in the country
with the aim of growing economic, trade, and investment ties between the two nations.
According to the Ministry of Planning and Investment, Japan was the leading source of FDI in 2018, accounting for 24.2% of
investment, ahead of South Korea with 20.3% and Singapore with 14.2%. We believe that rising labour costs in China, which is the
leading recipient of Japanese direct investment, will see a shift in investment to neighbouring Vietnam, which boasts a relatively
cheap and educated labour force, alongside a large and growing working class population. Additionally, trade tensions between
China and the US will continue to drive up costs for manufacturers operating in China, which is likely to accelerate the outsourcing
process.
Japanese FDI Redirection Likely From China

Japan - Outbound Manufacturing FDI, % Of Total Manufacturing FDI
Source: Japan Ministry Of Finance, Fitch Solutions
Aside from Terumo, Japanese companies with a manufacturing presence in Vietnam include Medikit for vascular access devices,
Metran for respiratory apparatus, Nikkiso for haemodialysis blood tubing lines, Omron for blood pressure monitors and Shimadzu for
X-ray apparatus. Additionally, Nipro is establishing a production facility for catheters, blood tubing and other dialysis products.
While Japanese companies predominate, a number of European multinationals are also expanding their manufacturing
operations in Vietnam, including B. Braun, which produces IV devices at a manufacturing facility in Hanoi, and Sonova which has a
production facility near Ho Chi Minh City, identified as one of the company's three global manufacturing hubs for hearing aids. In
March 2019, Sonova announced plans to shift additional service and manufacturing activities from the UK to Vietnam as part of a
global initiative to strengthen its supply chain and improve productivity.
Vietnam's Manufacturing To Benefit From Increased Trade Liberalisation
We highlight that efforts by the government to liberalise the economy will underpin robust growth in export-oriented
manufacturing. Vietnam shares the top spot in Southeast Asia with Singapore for having the highest number of bilateral and
multilateral free trade agreements (FTAs) with 11 active FTAs and six more in the pipeline. These include the Comprehensive and
Progressive Agreement for Trans-Pacific Partnership (CPTPP), which entered into force for Vietnam in January 2019, which will help
the country to align its trade and labour standards with international peers and give domestic companies access to a trading bloc
with a population of nearly 500mn. Additionally an FTA with the EU is awaiting approval and ratification, a final text having been
agreed in July 2018. The EUVFTA and IPA will eliminate most tariffs, increase market access and further reduce technical barriers to
trade. The Ministry of Planning and Investment estimates that the EUVFTA has the potential to boost Vietnam's GDP by 15%.
The attractiveness of Vietnam as a manufacturing hub lies in its geographical advantages, relatively cheap and large labour force,
attractive tax breaks, stable political environment, and open-door trade policies. We note that Vietnam has made steady progress in
improving its business environment as seen by the higher scores in the World Economic Forum’s competitiveness index where it
improved by five places to 55th (out of 137) in the 2017-18 edition, and in the 2018 World Bank’s ease of doing business index
where it climbed by 14 places to 68th among 190 economies.
VIETNAM: SUMMARY OF KEY ATTRACTIVENESS

Sector Strengths
Geography
• Long coastline with the potential for development of deep sea water ports
• Located along international sea routes
• Proximity to China and land connection to the greater Mekong region and Indochina
Demographics
• Third most populous country in Southeast Asia, numbering more than 90mn people
• Working age population set to peak only at around 2040
• Cheap manufacturing labour cost, which is less than half of China and a fraction of Mexico
Business Environment
• Stable political environment
Sector Strengths
• World Bank's Ease of Doing Business ranking stands at 68 out of 190 countries, ahead of China,
India, the Philippines and Bangladesh
Ease Of Trade
• 17 free trade agreements, of which 11 are active
• Member of WTO and ASEAN
Tax Regime
• General corporate income tax (CIT) rate of 20%, reduced CIT of 10% for up to 15 years
• Tax holidays: full exemption of CIT for up to 4 years and 50% for up to 9 years depending on project
Source: Fitch Solutions
Regulatory Development
Medical Devices Regulatory Development
Regulations
Since 2017, all medical device imports have been required to be registered for market authorisation licences. Registration is divided
into four Classes: Class A medical devices are considered lowest-risk, and include products such as bandages, gloves and catheters,
while Classes B, C, and D are generally higher-risk and/or more invasive products.
The new requirement was the result of legislation issued in 2016, Decree No. 36/2016/ND-CP on the management of medical
devices and Circular No. 39/2016/TT-BYT on the classification of medical devices. Under the legislation, a Vietnamese
representative office or subsidiary, or other local third party can be appointed as the market authorisation holder on behalf of a
foreign medical device company. The holder does not have to be the importer or distributor of the medical devices.
Vietnam is part of the Asian Harmonization Working Party, which aims to harmonise medical device regulations in the region.
Tax Ex
Exemptions
emptions FFor
or Components
In December 2014, the government issued a draft circular relating to import tax exemptions for components to be used in the
manufacture or assembly of advanced medical equipment. Import tax will be waived for five years starting from the date of
manufacture/assembly of the medical device, in accordance with paragraphs 15-100, circular No. 128/2013/TT-BTC of the Ministry
of Finance.
ASEAN Medical Device Directive (AMDD)
The ASEAN Medical Device Directive (AMDD) was signed in 2015 by all 10 ASEAN member states - Brunei, Cambodia, Indonesia,
Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam. Signatory countries have committed to ratifying the
agreement by the end of 2019, allowing the AMDD to come into effect in 2020.
Since its initial conception, Singapore and Malaysia have made marked progress in the implementation of AMDD, though we note
that other member states have somewhat lagged in this regard. Malaysia and Singapore, which have the most advanced regulatory
frameworks in the ASEAN, are leading work on the further implementation of AMDD, including the development of a common
nomenclature, post-market surveillance guidelines and device grouping guidance.
As of May 2018, Vietnam's progress in implementing the AMDD had been largely limited to the definition and classification of
medical devices and IVDs, although progress has also been made regarding post-market controls and labelling.
The AMDD should provide a harmonised system of placement of medical devices into the ASEAN market, based on common key
components of medical device regulatory controls to safeguard public health, as well as to reduce technical barriers, thereby
facilitating access of medical device products in the region. Regulators in the ASEAN will implement common requirements for all
10 member states, providing a more efficient and cohesive system that would benefit the industry, regulators and consumers in the
region. However, we highlight that unlike in Europe, this agreement will not result in a single 10-member market where a medical
device certified in one country is immediately eligible for sale in another.
Competitive Landscape
Medical Devices Manufacturing
Vietnam has around 50 domestic companies that manufacture basic products such as consumables, hospital furniture, and surgical
instruments. Most domestic manufacturers are owned by the MoH and often engage in the import, distribution and servicing of
equipment, although they remain undercapitalised and inefficient by Western standards. The joint venture, Vikomed, was the first
company to set up a modern medical equipment manufacturing plant in the country.
In November 2013, the MoH's Administration of Science, Technology and Training announced that it had signed an agreement with
Quintiles to enhance clinical research. Medical devices is one of Quintiles' business areas.
As part of a drive to reduce Vietnam's dependence upon medical device imports, the government started a national programme to
boost domestic production in 2011, that was to conclude in 2015.
Medical Devices National Manufacturers
MEDEP
Overview: MEDEP was established in 2015 to become Vietnam's first producer of intraocular lenses (IOLs). The company is located
in Saigon Hi-tech Park, Ho Chi Minh City.
Manufacturing: MEDEP started the construction of a factory to produce IOLs in October 2015, with the aim of going into production
in 2019 using technology transferred from the US. Investment in the facility is expected to total up to VND293.4trn (USD13.8mn).
Minh Tam
Overview: Minh Tam was the first company in Vietnam to manufacture disposable medical plastic products. The company is
headquartered in Ho Chi Minh City.
Product Portfolio: The company manufactures nasal cannulae, infusion sets, feeding tubes and suction catheters.
Manufacturing: The company's factory is located in the Hóc Môn district of HoChiMinh City.
USM Healthcare
Overview: USM Healthcare, established in 2012, is the first Vietnamese company to produce cardiovascular products. The company
is headquartered in Ho Chi Minh City.
Product Portfolio: The company produces a range of cardiovascular products and surgical theatre accessories including PTCA
balloon catheters, coronary stents, IV catheters, wound dressings, drapes and gowns.
Manufacturing: USM Healthcare operates the United Healthcare Factory, a 10,000m2 manufacturing plant in Saigon Hi-tech Park,
Ho Chi Minh City. Built at a cost of VND219trn (USD10mn), the facility was opened in 2015.
R&D: Research and development is undertaken at the 14,000m2 USM Biomedical Technology Research Center in Saigon Hi-tech
Park, Ho Chi Minh City.
Vikomed
Overview: Vikomed is a joint venture that was formed in 2007 between the Vietnam Laser Technology Centre and GEMSS Medical
Systems, a leading South Korean medical equipment manufacturer. Vikomed has become a leading centre for medical equipment
research and manufacturing in Vietnam. The company has offices in many provinces and cities such as Hanoi, Ho Chi Minh City, Can
Tho, Da Nang and Yen Bai.
Product Portfolio: The product range includes fluoroscopy devices, lithotripters, picture archiving and communication systems
(PACS) and hospital information systems (HIS).
R&D: In 2016, Vikomed plans to construct a high-tech R&D centre on an area of two hectares.
Manufacturing: Vikomed is the first company to have a modern medical equipment manufacturing and assembling factory in the
domestic market. The factory is situated on a 10,000m2 campus at the Hoa Lac Hi-Tech Park in Hanoi, and is the largest medical
equipment production facility in Southeast Asia.
Vikomed is a major supplier to the domestic market, providing its PACS and HIS products to a number of leading hospitals such as
Bach Mai, Viet Duc, Hanoi Medical University and Hanoi Friendship Hospital. The company also exports 80% of its products to
foreign markets. The signing of the Vietnam-Korea Free Trade Agreement (VKFTA) in 2015 will facilitate technology transfer and
localising production at Vikomed. Lowered tariff barriers in South Korea will enable the company to reduce product costs and
gradually master technologies.
Vina Medical (Vinamed)
Overview: Vina Medical (Vinamed) is a medical equipment enterprise established in 1971. It is a member of the Vietnam Medical
Equipment Corporation under the MoH. By 2004, it had become a joint stock company. The Vietnamese state's stake in the former
100% state-owned medical product supplier was reduced to 20% following an IPO which was completed in May 2016. After the
privatisation, Hanoi-based Vinamed was capitalised at VDN88bn (USD3.8mn). One of the largest stakeholders in Vinamed is now
Son Ha, a manufacturer of steel products.
Product Portfolio: The company produces hospital beds, including multifunctional emergency beds and delivery beds, examination
tables, medical injection trolleys and bedside cabinets. The company has a joint venture with the Japanese company Shimadzu,
called Shimadzu Vietnam Medical Hi-Tech, to produce X-ray and ultrasound equipment for the domestic and international markets.
Manufacturing: Vinamed has achieved ISO 9001 certification for its hospital furniture.
Distribution: Vinamed also distributes a broad range of medical products for overseas manufacturers including Omron (Japan), RZ
Medizintechnik (Germany), Weinmann (Switzerland) and AMICO (Russia).
Medical Devices Multinational Manufacturers
B. Braun
Overview: B. Braun opened a representative office in Ho Chi Minh City in 1992. In 1997, the company established a joint venture,
based in Hanoi, for the production of intravenous infusion solutions and devices, IV cannula, sutures and surgical instruments for
the local market and neighbouring Cambodia and Laos. The JV, named B. Braun Hanoi Pharmaceutical Co, is between B. Braun, the
local Hanoi Pharmaceutical Factory, and a Malaysian partner. At the end of 2018, B. Braun Vietnam had 1,264 employees.
Acquisition: In July 2018, B. Braun announced an agreement to acquire US-based NxStage Medical's bloodlines business.
Financial Review: B. Braun Vietnam reported sales of EUR89.0mn (USD104.7mn) in 2018, an increase of 8.4% from EUR82.1mn
(USD92.8mn) in 2017.
Product Portfolio: B. Braun operates four main divisions: Hospital Care, Aesculap for surgical products, Out-Patient Market and B.
Braun Avitum. B. Braun's product range includes IV solutions, syringe pumps, and accessories for IV therapy, intensive care and
anaesthesia, as well as surgical instruments, sutures, hip and knee endoprostheses, equipment and accessories for dialysis, and
woundcare products.
Manufacturing: B. Braun opened a standard infusion plant in 1997 and a 9,800m2 IV sets plant in October 2011. Both facilities are
located in Hanoi. The IV sets plant cost EUR32.6mn (USD45.3mn), and the company stated that it would enable IV set production to
increase from 35mn to 100mn units per year, and to as many as 200mn in the long term.
Mediplast
Overview: In 2002, Mediplast announced that it was to begin production of single-use syringes, at a cost of VND1,000 (six US cents)
each. The technology for the syringes comes from Star Syringe, a UK company, which has also licensed Mediplast to export syringes
to other Asian countries. The company is based in Hanoi.
Product Portfolio: The company produces disposable syringes, self-locking syringes and infusion sets.
Manufacturing: Mediplast produced an estimated 30-60mn syringes in the 0.5-3.0ml size range in 2003.
Medikit
Overview: Medikit Vietnam was established in 2005 by Japanese manufacturer Medikit. In 2011, the company opened a factory in
Haiphong.
Product Portfolio: Medikit manufactures vascular access medical devices, notably fluorine resin HD catheters for use by hospitals
and emergency services.
Metran
Overview: Metran is a Japanese manufacturer of respiratory apparatus including ventilators and oxygen concentrators. Metran
opened an office in Ho Chi Minh City in 2008 for the importing and sales of medical devices.
Manufacturing: In July 2008, the company opened a factory in Ho Chi Minh City. The Metran Vitec branch opened a plant in Tinh
Binh Duong in December 2012 for the manufacturing and export of medical devices and sterile water for medical devices. Metran
Vitec achieved ISO 9001 and ISO 13485 certification in 2014.
Nikkiso Vietnam MFG
Overview: Nikkiso of Japan established Nikkiso Vietnam MFG, a wholly-owned subsidiary, in 2001. The company is based in Ho Chi
Minh City.
Product Portfolio: The company manufactures blood tubing lines for haemodialysis.
Manufacturing: In 2017, Nikkiso reported that it had increased production capacity at its factory in Ho Chi Minh City.
Nipro
Overview: Nipro Vietnam was established in Ho Chi Minh City in 2017.
Product Portfolio: Nipro operates Medical-Related, Pharmaceutical-Related and Glass-Related Businesses. The Medical-Related
Business specialises in Renal, Injection, Diabetic, Catheter, Infusion and Other Products.
Manufacturing: Nipro announced plans to build a USD300mn facility in the Saigon Hi-Tech Park, Ho Chi Minh City in 2017. Upon
completion, the facility will produce catheters, blood tubing and other dialysis products.
Omron
Overview: Omron has two healthcare subsidiaries active in Vietnam: Omron Health Singapore which has offices in Hanoi and Ho Chi
Minh, and Omron Healthcare Manufacturing Vietnam which is located in TDM City, Binh Duong Province.
Product Portfolio: Omron’s Healthcare Business is one of the company’s six businesses. Its product range covers blood pressure
monitors, nebulisers, thermometers, body composition monitors, patient monitors and other products such as activity trackers.
Manufacturing: Omron Healthcare Manufacturing Vietnam produces up to 12 million blood pressure monitors and nebulisers each
year at its factory in TDM City.
Perfect Medical
Sales & Marketing: Perfect Medical is a Taiwanese manufacturer of scalp vein sets, haemodialysis tubing, transfusion sets, infusion
sets, arteriovenous fistulae and syringes. In 2001, the company doubled its production capacity by setting up a manufacturing plant
in Ho Chi Minh City.
Shimadzu
Overview: In April 1997, the Japanese company Shimadzu began a joint venture in Vietnam for the production of diagnostic X-ray
equipment. The JV, called Shimadzu Vietnam Medical Hi-Tech, is 70% owned by the Japanese firm, with the remainder owned by
Vinamed and Schmidt Asia Ltd, a German company.
Product Portfolio: Shimadzu Medical Systems designs, produces, sells and services X-ray diagnostic imaging systems, mainly for
hospitals and clinics.
Manufacturing: A new production facility opened in Hanoi in February 2000, although the assembly of imported X-ray components
has been under way since 1997. Shimadzu also has a service and training centre based in Hanoi.
Sonion
Overview: The Danish company Sonion has been producing miniature components for hearing aids in Vietnam since November
2006. The company employs around 2,500 people.
Product Portfolio: The Vietnamese facility focuses on transducers and electromechanical components for the hearing instrument
and advanced acoustics industries.
Manufacturing: Sonion's manufacturing facility is located at the Saigon Hi-Tech Park in Ho Chi Minh City. The company opened its
Plastic Moulding Centre in Vung Tau in 2011, where 45 employees produce plastic for the Ho Chi Minh factory.
Terumo
Overview: Terumo has been present in Vietnam since 2008. Terumo has been building its manufacturing presence in Vietnam as
part of its strategy of moving production from Japan to lower cost production sites in other parts of Asia.
Product Portfolio: Terumo's product range includes blood banking products, blood glucose monitoring systems, cardiovascular
systems, catheter systems, clinical testing systems, home healthcare products, injection systems, nutritional food supplements,
pharmaceuticals, peritoneal dialysis and transfusion & infusion equipment.
Manufacturing: Terumo first opened a plant in Vietnam in 2008, for the production of extension tubes. In 2010, the company
expanded production to include interventional systems and vascular grafts. In July 2014, Terumo's blood component's subsidiary
Terumo BCT opened a factory at the Long Duc Industrial Park in the province of Dong Nai. Around USD100mn was invested in the
20,000m2 plant that was developed on 10 hectares of land. The plant has been set up for manufacturing blood bags and
disposables for automated collections, most of which are destined for export to other Asian countries, the EU and the US.
In Q119, Terumo announced plans to construct a new building to house a third manufacturing facility to expand production of
interventional devices. The company expects construction to be completed in December 2020. It will also install additional
production facilities to increase production at the current first and second buildings. The investment will total approximately
JPY15bn (USD134.2mn) over five years, and as a result of the investment, production capacity is expected to double.
Medical Devices Multinational Activity

Vietnam is not a strong base for leading multinational companies. Some companies have a representative office for the purpose of
sales, distribution and service, while others have no direct presence and products are imported via local distributors. Major
multinationals with no manufacturing presence are listed below with their respective representation in the market.
Becton Dickinson
Sales & Marketing: Becton Dickinson has a representative office in Ho Chi Minh City.
Divestitures: In September 2018, BD announced the sale of its Advanced Bioprocessing business to Thermo Fisher Scientific. In
March 2018, BD announced an agreement to divest its remaining stake in Vyaire Medical to funds managed by Apax Partners for a
transaction value of USD435mn.
Acquisitions: BD completed the USD24bn acquisition of Bard in December 2017, and the USD12bn acquisition of CareFusion in
March 2015.
Product Portfolio: BD has three reportable segments since December 2017: Interventional, Medical and Life Sciences. The majority
of the Bard businesses will be reported under the new Interventional segment, which will have three units: Peripheral Interventional,
Surgery and Urology & Critical Care. Medical operates four main businesses: Diabetes Care, Medication Delivery Solutions
(rebranded), Medication Management Solutions and Pharmaceutical Systems. Life Sciences has three units: Biosciences, Diagnostic
Systems and Preanalytical Systems.
Fresenius Medical Care
Sales & Marketing: FMC Vietnam is a wholly-owned subsidiary based in Ho Chi Minh City which had 35 employees in 2018.
Acquisition: In February 2019, FMC announced the completion of its USD2bn acquisition of NxStage Medical.
Financial Review: FMC Vietnam reported revenues of EUR7.9mn (USD9.3mn) in 2018, an increase of 11.3% from EUR7.1mn
(USD8.1mn) in 2017.
Product Portfolio: FMC is one of the four business segments operated by Fresenius. It focuses on products for haemodialysis,
peritoneal dialysis, further home therapies, acute dialysis, other blood cleansing procedures; and dialysis drugs.
GE Healthcare
Sales & Marketing: GE Healthcare is one of the business units operated by GE, which has been present in Vietnam since 1993. It has
a representative office in Hanoi, which was expanded to Ho Chi Minh City in 2001. In 2003, GE established GE Vietnam Ltd, offering a
wide range of products and services in the field of healthcare, energy and aviation. GE employs more than 900 people in Vietnam.
GE Healthcare's presence in the Vietnamese medical device market will be strengthened following the signing of an agreement
with VINMEC for a comprehensive strategic co-operation agreement in December 2017. The two companies will co-operate in the
fields of medical technology, human resources training and hospital design. The agreement, which gives VINMEC access to GE
Healthcare's diagnostic imaging, nuclear medicine, ultrasound, anaesthesia and ventilation portfolio, will also be integral to the
development of the VINMEC University Hospital of Health Sciences Project. The hospital, which will have 1,200 beds, is due to open
in 2019.
Spin-off: In February 2019, GE announced the USD21.4bn sale of its Biopharma Business to Danaher. In June 2018, GE announced
that Healthcare will become a standalone company.
Divestiture: In April 2018, GE announced an agreement to sell GE Healthcare’s Value-Based Care Division to Veritas Capital for
USD1.1bn.
Product Portfolio: GE Healthcare operates three main segments: Healthcare Systems, Life Sciences and Healthcare Digital.
Healthcare Systems provides diagnostic imaging systems (X-ray, digital mammography, CT, MR, surgical and interventional imaging
and molecular imaging), clinical systems (ultrasound, ECG, bone densitometry, patient monitoring, incubators and infant warmers,
respiratory care and anaesthesia management) and remote diagnostic and repair services for medical equipment manufactured by
GE and others. Life Sciences specialises in products, services and manufacturing solutions for drug discovery, the biopharmaceutical
industry, and cellular and gene therapy technologies; and innovative imaging agents used during medical scanning procedures to
highlight organs, tissue and functions inside the human body. Healthcare Digital provides medical technologies, software, analytics
and cloud solutions.
In March 2015, the company introduced its new CARESCAPE R860 ventilator, and in November 2014, GE introduced a new suite of
innovative solutions for the survival and growth of newborns across Vietnam, which will increase access to such devices, particularly
in primary care or low-resource settings. Also, in March 2015, GE Healthcare and Bach Mai Hospital signed a MOU to introduce a
new education programme at the Hanoi-based hospital. The collaboration includes USD250K in patient monitors, which will be
used to help train Vietnamese clinicians from across the country on how to better utilise patient monitors to improve patient care,
specifically in the Emergency Department and Intensive Care Unit.
Johnson & Johnson
Sales & Marketing: Johnson & Johnson (J&J) has a representative office in Hanoi.
Divestitures: In April 2019, J&J completed the USD2.8bn divestiture of Advanced Sterilization Products (ASP), a division of Ethicon, to
Fortive Corporation. In October 2018, J&J completed the USD2.1bn divestiture of its LifeScan business, specialised in blood glucose
monitoring products, to Platinum Equity. In October 2017, J&J completed the USD1.0bn divestiture of its Codman Neurosurgery
business to Integra LifeSciences. In October 2015, J&J completed the USD2.0bn divestiture of its Cordis business to Cardinal Health.
In 2014, J&J divested the Ortho-Clinical Diagnostics business.
Acquisitions: In April 2019, J&J announced that Ethicon has completed the acquisition of robotics company Auris Health for
USD3.4bn in cash and up to USD2.4bn in additional contingent payments. In June 2017, J&J’s DePuy Synthes acquired Innovative
Surgical Solutions. In February 2017, J&J’s Ethicon announced a deal to acquire Torax Medical. In February 2017, J&J completed the
USD4.3bn acquisition of Abbott Medical Optics (AMO).
Product Portfolio: J&J is organised into three business segments: Consumer, Pharmaceutical and Medical Devices. The Medical
Devices segment includes a broad range of products used in the cardiovascular, diabetes care, diagnostics, orthopaedics (hips,
knees, trauma and spine & other), surgery (advanced, general and specialty) and vision care markets. The company's largest markets
are surgery and orthopaedics.
In July 2017, J&J presented Cerenovus, its new neurovascular business, which was expanded with the acquisitions of Pulsar Vascular
in December 2016 and Neuravi in April 2017. Cerenovus is part of DePuy Synthes Products, within the Medical Devices Companies
segment.
Medtronic
Sales & Marketing: Medtronic announced the opening of an office in Ho Chi Minh City in September 2016, as it continues to execute
its globalisation strategy. Medtronic says the office will allow it to respond more effectively to the needs of local customers, and help
improve the level of patient care.
Divestiture: In July 2017, Medtronic completed the sale of its Patient Care, Deep Vein Thrombosis (Compression) and Nutritional
Insufficiency businesses within the Patient Monitoring & Recovery (PMR) division of its Minimally Invasive Therapies Group (MITG) to
Cardinal Health for USD6.1bn.
Acquisitions: In January 2019, Medtronic announced the acquisition of US-based EPIX Therapeutics to expand its cardiac ablation
portfolio. In December 2018, Medtronic completed the USD1.7bn acquisition of Israel-based Mazor Robotics. In August 2016,
Medtronic acquired HeartWare International for USD1.1bn. In February 2016, Medtronic acquired Italian haemodialysis treatment
company Bellco. Overall, Medtronic has strengthened its global position following the USD50bn acquisition of Covidien in January
2015.
Product Portfolio: Medtronic operates four business groups: Cardiac and Vascular Group (CVG), Diabetes Group, Restorative
Therapies Group (RTG) and MITG which represents 90% of Covidien's revenues. Covidien's Peripheral Vascular business has been
integrated into CVG, while Covidien's Neurovascular business has been integrated into RTG.
Philips
Sales & Marketing: Philips HealthTech has a representative office based in Ho Chi Minh City.
Acquisitions: In July 2018, Philips completed the acquisition of EPD Solutions, an Israeli developer of cardiac imaging and navigation
systems for use in image-guided procedures to treat cardiac arrhythmia, which will further expand the company's image-guided
therapy portfolio. In June 2018, Philips announced the acquisition of the UK’s Remote Diagnostic Technologies to expand its
position in the resuscitation and emergency care market. In 2017, Philips completed the USD2.2bn acquisition of Spectranetics to
strengthen its image-guided therapy business group, and the acquisition of CardioProlific, which develops catheter-based
thrombectomy products.
Product Portfolio: Philips focuses on three main businesses: Diagnosis & Treatment (diagnostic imaging, ultrasound, image-guided
therapy, driven by the integration of Volcano including interventional X-ray and smart catheters); Connected Care & Health
Informatics (patient monitoring, hospital ventilators, defibrillators, home and remote cardiac monitoring, healthcare IT and high-end
radiology & cardiology informatics); and Personal Health (sleep & respiratory care, oral healthcare, mother & childcare, air purifiers
and male grooming). The company has leading market positions in a number of areas, including cardiovascular X-ray, image-guided
interventions, patient monitoring, and home healthcare.
Siemens Healthineers
Sales & Marketing: Siemens has had an office in Vietnam since 1993. The company has a main representative office in Hanoi and a
branch office in Ho Chi Minh City.
Initial Public Offering (IPO): In March 2018, Siemens raised EUR4.2bn when it sold a 15% stake in Siemens Healthineers. This IPO will
help target acquisitions in high growth areas.
Divestitures: In FY2015, Siemens sold its hearing aid and hospital information businesses.
Acquisitions: In November 2017, Siemens Healthineers closed the acquisition of Alere's point-of-care blood diagnostics subsidiary,
Epocal. In June 2017, Siemens Healthineers closed the acquisition of Medicalis, which will strengthen its Population Health
Management (PHM) offering.
Product Portfolio: Siemens Healthineers has six business areas: Diagnostic Imaging, Laboratory Diagnostics, Advanced Therapies,
Ultrasound, Point of Care Diagnostics and Services.
In 2014, Siemens installed 20 MRI units in Vietnam. The company maintained its 100% market share for 3-Tesla MRI diagnostic
scanners installed in the country. The new Dong Nai General Hospital ordered a package of diagnostic devices and software
solutions, including Definition Flash, Magnetom Verio, Symbia E, syngo.via and syngo.plaza.
Varian Medical Systems
Overview: Varian Medical Systems' growth prospects in the Vietnam market will be supported by its 'Access to Care' programme.
The programme, launched in 2015, is intended to increase the number of qualified staff able to plan and deliver treatments by
providing training for radiation oncologists, medical physicists and radiotherapy therapists from across the country. Vietnam was
one of the first countries to participate in the programme where experts from Varian led students from oncology centres in the
country through a comprehensive educational curriculum.
Spin-off: In January 2017, Varian spun-off its Imaging Components business, which has become Varex Imaging Corporation, a new
independent public company. The new company includes the Medical Imaging business of PerkinElmer, acquired by Varian in
December 2016.
Acquisitions: In August 2018, Varian announced the acquisition of Germany-based HumediQ, a producer of an automated patient
identification, positioning and motion management system for radiation therapy. In February 2018, Varian acquired Evinance
Innovation, a Canadian clinical decision support software company, and purchased Mobius Medical Systems, focused on radiation
oncology software.
Product Portfolio: Following the separation of its Imaging Components business, Varian Medical Systems focuses exclusively on
Oncology Systems. The product range covers radiotherapy, radiosurgery, proton therapy and brachytherapy.
Collaboration: In June 2017, Varian Medical Systems signed an agreement with Vijametech and UPMC (University of Pittsburgh
medical centre) Cancer Care, to develop plans for future radiation oncology centres in Vietnam. The three companies will
collaborate with the MoH and the Vietnam National Cancer Hospital over the next two years to assist in developing, deploying,
managing and servicing cancer treatment technologies in out-patient cancer centres in Vietnam. The agreement has the support
of the US Department of Commerce and the Vietnamese government.
Medical Devices Market Access
Market Environment
Situated on the Indochina Peninsula in Southeast Asia, Vietnam is undergoing rapid development, although much of the country
remains poorly developed and relatively inaccessible. Mountains account for 40% of the country's land area, and tropical forests
cover around 42%. Around 9mn of the country's 92mn population live in Ho Chi Minh City. Vietnam is divided into 58 provinces and
five municipalities, which are administratively on the same level as provinces.
The Doi moi economic reforms, which began in 1986, have created a thriving, if basic, socialist-oriented market economy. Vietnam
is one of the largest oil producers in Southeast Asia and the country has a growing manufacturing and information technology
sector. As a Socialist Republic, Vietnam is one of the world's four remaining single-party communist states. In recent years, Vietnam
has adopted a more liberal and open attitude culminating in accession to the World Trade Organisation in 2007, which has opened
the doors to increased trade and investment in the country. The government remains committed to market-oriented reforms.
Vietnam became a full member of the ASEAN in 1995.
In December 2014, the government issued a draft circular relating to import tax exemptions for components to be used in the
manufacture or assembly of advanced medical equipment. The draft circular is intended to guide decision No 54/2014/QĐ-TTg
dated 19/9/2014 (decision 54) of the Prime Minister on this issue. Import tax will be waived for five years starting from the date of
manufacture/assembly of the medical device (in accordance with paragraphs 15-100, circular No. 128/2013/TT-BTC dated 10/9/
2013 of the Ministry of Finance).
Distribution
Only local companies can distribute medical devices in Vietnam; foreign companies must therefore sell their products through
appointed local distributors and agents.
Many companies rely on a dedicated local distributor.
One of the country's leading distributors is the former 100% state-owned Vinamed, which completed an IPO in May 2016 that
reduced the state's stake in the company to 20%. Vinamed holds a 6% stake in Thiết bị Y tế Viêt - Nhât (JSC Medical Equipment
Vietnam-Japan) which is the sole agent for Hitachi, Fujifilm and Konica.
Legalities aside, Vietnamese buyers, especially in the public sector, generally expect to deal with a local distributor to handle all
aspects of distribution, from delivery to after sales service and provision of spare parts.
Trade Agreements
Vietnam shares the top spot in Southeast Asia with Singapore for having the highest number of bilateral and multilateral free trade
agreements (FTAs) with 11 active FTAs and six more in the pipeline. We highlight the following FTAs which are of particular strategic
importance:
• The ASEAN Free Trade Area (AFTA) was established in 1992 and now comprises all ten members of the Association of
Southeast Asian Nations (ASEAN), namely Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand
and Vietnam. The agreement aims to support local manufacturing in ASEAN countries through the elimination of trade barriers
and to attract more foreign direct investment to the area. AFTA applies a Common Effective Preferential Tariff (CEPT) to goods
originating within the ASEAN, which is now zero for virtually all goods within the region. The ASEAN also has FTAs with several
other countries in Asia including China and India and a combined FTA with Australia and New Zealand (AANZFTA), which aims to
eliminate tariffs on 96% of all traded products between the regions by 2020.
• The Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) entered into force for Australia,
Canada, Japan, Mexico, New Zealand and Singapore in December 2018, with Vietnam joining them in January 2019. Brunei, Chile,
Malaysia and Peru are expected to ratify the agreement in 2019, but the Pakatan Harapan coalition government in Malaysia,
which has placed all trade and investment pacts under review, has expressed reservations. The CPTPP represents the world’s
third largest trade agreement, after the United States-Mexico-Canada Agreement (USMCA, previously NAFTA) and the European
Single Market, and is a reworking of the TPP following the withdrawal of the US in January 2017. Under the CPTPP, tariffs on over
90% of goods have been eliminated, with tariffs on other goods set to be eliminated over a 12-year timeframe. The pact will also
improve access to government procurement, boost intellectual property rights protection, promote the growth of the digital
economy and increase minimum employment standards for workers in participating countries. However, the suspension of 22
provisions of the original TPP, including several relating to intellectual property, confirms our view that the new agreement will be
less ambitious and the positive impact on multinational medical device companies in terms of market access and more stringent
intellectual property rights, which the US had advocated under TPP, will not be of the same magnitude. CPTPP members have a
combined population of over 500mn and their economies represent around 13% of global GDP. Colombia, Indonesia, South
Korea, Taiwan, Thailand and the UK have also expressed an interest in joining the pact.
• An EU-Vietnam FTA (EUVFTA) is awaiting approval and ratification following the conclusion of negotiations. The agreement will
promote bilateral trade and economic growth between the EU and Vietnam. It will eliminate most tariffs, increase
market acces and further reduce technical barriers to trade.
• Negotiations on a framework agreement for the Regional Comprehensive Economic Partnership (RCEP) will most likely be
finalised in 2019. At the 7th RCEP Intersessional Ministerial Meeting in Cambodia in March 2019, participating countries
reaffirmed their commitment to the pact in the face of rising uncertainties in the global trade environment and agreed to
intensify engagement for the remainder of the year, including by convening more intersessional meetings. Market access
negotiations advanced substantially during 2018 when agreement was reached on five chapters, bringing the number
concluded to seven, with good progress reported on the outstanding 11 chapters. RCEP will have broader and deeper
engagement with significant improvements over existing regional FTAs and agreement will need to be reached on politically
sensitive issues, including trade in services, investment rules and protection for intellectual property rights, as well as tariffs,
where the target is to remove trade barriers on at least 92% of products within ten years. Formally launched in 2012, RCEP is a
China and ASEAN-led project involving 16 countries, namely the 10 ASEAN countries and the ASEAN Free Trade Partners
(Australia, China, India, Japan, South Korea and New Zealand). If approved, RCEP will be the world’s largest trade pact covering
more than 48% of the world’s population, 38% of global GDP and 42% of global trade.
• Vietnam and South Korea signed the Vietnam-Korea FTA (VKFTA) in May 2015, aimed at boosting trade between the two
countries to USD70bn annually. Under the terms of the deal, import duties for all South Korean goods will be reduced by nearly
90% by Vietnam over a period of 15 years, while, South Korea agreed to reduce import duties on Vietnamese products by more
than 95%.
Trade Fairs
• The annual Pharmed and Healthcare Vietnam (Pharmedi) trade show is next due to be held on September 11-14 2019 at
the Saigon Exhibition and Convention Centre in Ho Chi Minh City. For more information, visit www.pharmed.vn
• The 26th International Medical Hospital & Pharmaceutical Expo will be held on December 5-7 2019 at the
Hanoi International Exhibition Centre. For more information, visit http://medipharmexpo.com
Medical Devices Methodology

Forecast Methodology
Fitch Solutions uses a wide definition of medical device, similar to that used by the US FDA or EU EMA. In short, we define it as any
piece of equipment or apparatus used to treat or diagnose an illness that comes into direct contact with the patient.
Pharmaceuticals, IV diagnostics and laboratory equipment are not within the scope of our forecasts.
We have estimated national markets at ex-factory prices for the historical period in current local and USD terms. We have calculated
the markets using a trade-based approach, looking at imports, and then adding in domestic production, minus any exports. We have
sourced import and export data from national customs authorities, as compiled by the International Trade Centre (ITC).
We have estimated production data, considering factors such as the value of exports, taking into account re-exports, the known
presence of local and multinational manufacturers, sales data when available, and officially published estimates of production, again
when available.
We have forecast national markets at ex-factory prices for the forward period. Firstly, we have calculated growth rates in local
currency terms for each product category using a linear regression method, and then converted the figures back to USD terms,
using average exchange rate projections.
We have calculated growth rates by looking at a number of factors: macro-economic performance (private and government final
consumption); demographic and epidemiological trends; healthcare trends and expenditure levels; medical device trade trends; and
medical device manufacturing size.
Trade Code Classifications
International trade is universally classified according to the Harmonised System (HS). This began to be used in the 1990s, and is
overseen by the World Customs Organization. Medical devices are generally well-defined in the HS. There is one major code,
HS9018, named Medical Equipment, but there are a number of other codes for products with a specifically medical use. For the
majority of countries, it is not possible to provide a more detailed breakdown than this.
We have rearranged the data from their original code order, to create six major product areas: CONSUMABLES, DIAGNOSTIC
IMAGING, DENTAL PRODUCTS, ORTHOPAEDICS & PROSTHETICS, PATIENT AIDS AND OTHER MEDICAL DEVICES. We have sub-
divided these into categories and sub-categories. We have used them to analyse medical device market and trade data. Their
relation to the trade codes is shown on the following table.
REARRANGED HS TRADE CODES

Code Product
CONSUMABLES
BANDAGES & DRESSINGS
'300510 Medical dressings (adhesive)
'300590 Medical dressings (non-adhesive)
Code Product
'300610 SUTURING MATERIALS
SYRINGES, NEEDLES & CATHETERS
'901831 Syringes (with/without needles)
'901832 Tubular metal needles/needles for sutures
'901839 Other needles, catheters, cannulae, etc
OTHER CONSUMABLES
'300620 Blood-grouping reagents
'300650 First-aid boxes & kits
'300691 Ostomy products
'401511 Surgical gloves
DIAGNOSTIC IMAGING
ELECTRODIAGNOSTIC APPARATUS
'901811 Electrocardiographs
'901812 Ultrasound
'901813 MRI
'901814 Scintigraphic apparatus
'901819 Other electrodiagnostic apparatus
RADIATION APPARATUS
'902212 CT scanners
'902214 Other medical x-ray apparatus
'902221 A, B, C ray apparatus
IMAGING PARTS & ACCESSORIES
'300630 Contrast media
'370110 Medical X-ray film (flat)
'370210 Medical X-ray film (rolled)
'902230 X-ray tubes
'902290 Other imaging parts & accessories
DENTAL PRODUCTS
CAPITAL EQUIPMENT
Code Product
'901841 Dental drills
'940210 Dental chairs
'902213 Dental X-ray
INSTRUMENTS & SUPPLIES
'300640 Dental cements
'901849 Dental instruments
Teeth & other fittings
'902121 Artificial teeth
'902129 Other dental fittings
ORTHOPAEDICS & PROSTHETICS
'902110 FIXATION DEVICES
'902131 ARTIFICIAL JOINTS
'902139 OTHER ARTIFICIAL BODY PARTS
PATIENT AIDS
PORTABLE AIDS
'902140 Hearing aids
'902150 Pacemakers
'902190 Other portable aids
THERAPEUTIC APPLIANCES
'901910 Mechano-therapy apparatus
'901920 Therapeutic respiration apparatus
OTHER MEDICAL DEVICES
WHEELCHAIRS
'871310 Wheelchairs, not mechanically propelled
'871390 Wheelchairs, mechanically propelled
'901850 OPHTHALMIC INSTRUMENTS
Code Product
'940290 HOSPITAL FURNITURE
'841920 MEDICAL, SURGICAL STERILISERS
'901820 ULTRA-VIOLET OR INFRA-RED RAY APPARATUS
'901890 OTHER INSTRUMENTS & APPLIANCES
10 digit Blood pressure monitors
10 digit Endoscopy apparatus
10 digit Dialysis apparatus
10 digit Transfusion apparatus
10 digit Anaesthetic apparatus & instruments
Sources
We have sourced historical and forecast political, macro-economic, demographic and healthcare data, where indicated, from Fitch
Solutions.
We have analysed the medical device markets using, where possible, primary qualitative and quantitative data from local sources.
These include:
• national ministries (or departments) of health,

• national statistical institutes,
• national medical device trade associations, and
• national and multinational medical device companies.
We may also make reference to a number of secondary sources, such as those listed below:
• Eurostat, http://epp.eurostat.ec.europa.eu/portal/page/portal/eurostat/home/
• Inter-American Development Bank (IDB), http://www.iadb.org
• International Trade Centre (ITC), http://www.intracen.org
• Organisation for Economic Co-operation and Development (OECD), http://www.oecd.org
• United Nations (UN), http://www.un.org
• World Bank (WB), http://www.worldbank.org
• World Customs Organization (WCO), http://www.wcoomd.org
• World Health Organization (WHO), http://www.who.org
• World Trade Organization (WTO), http://www.wto.org
Contact
We welcome feedback on all the medical device market reports. If you have any further questions, comments or suggestions about
the contents of this report, please send them to:
Ricardo Vicente
Head of Medical Devices Markets
enquiries@fitchsolutions.com
Risk/Reward Index Methodology
Our Medical Devices Risk/Reward Index (RRI) quantifies and ranks a country's attractiveness within the context of the Medical
Devices industry, based on the balance between the Risks and Rewards of entering and operating in different countries.
We combine industry-specific characteristics with broader economic, political and operational market characteristics. We weight
these inputs in terms of their importance to investor decision making in a given Industry. The result is a nuanced and accurate
reflection of the realities facing investors in terms of: 1) the balance between opportunities and risks; and 2) between sector-specific
and broader market traits. This enables users of the Index to assess a market's attractiveness in a regional and global context.
The Index uses a combination of our proprietary forecasts and analyst assessment of the regulatory climate. As regulations evolve
and forecasts change, so the Index scores change providing a highly dynamic and forward-looking result.
The Medical Devices RRI universe comprises 75 countries.
Benefits Of Using Fitch Solutions' Medical Devices RRI
• Global Index: One global table, ranking all the countries in Fitch Solutions' universe for Medical Devices from least (closest to
zero) to most attractive (closest to 100).
• Accessibility: Easily accessible, top down view of the global, regional or sub-regional Risk/Reward profiles.
• Comparability: Identical methodology across 75 countries for Medical Devices allows users to build lists of countries they wish to
compare, beyond the confines of a global or regional grouping.
• Scoring: Scores out of 100 with a wide distribution provide nuanced investment comparisons. The higher the score, the more
favourable the country profile.
• Quantification: Quantifies the Rewards and Risks of doing business in the Medical Devices sector in different countries around
the world and helps identify specific flashpoints in the overall business environment.
• Comprehensiveness: Comprehensive set of indicators, assessing industry-specific Rewards and Risks alongside political,
economic and operating risks.
• Entry Point: A starting point to assess the outlook for the Medical Devices sector, from which users can dive into more granular
forecasts and analysis to gain a deeper understanding of the market.
• Balance: Multi-indicator structure prevents outliers and extremes from distorting final scores and rankings.
• Methodology: It is a combination of proprietary Fitch Solutions forecasts, analyst insights and globally acceptable benchmark
indicators (for example, World Bank's Doing Business Scores, Transparency International's Corruption Perceptions Index).
Weightings Of Categories And Indicators
The RRI matrix divides into two distinct Categories:
Rewards:
Evaluation of an Industry's size and growth potential (Industry Rewards), and also macro industry and/or country characteristics
that directly impact on the size of business opportunities in a specific sector (Country Rewards).
Risks:
Evaluation of micro, industry-specific characteristics, crucial for an industry to develop to its potential (Industry Risks) and a
quantifiable assessment of the country's political, economic and operational profile (Country Risks).
Assessing Our Weightings
Our matrix is deliberately overweight on Rewards (70% of the final RRI score for a market) and within that, the Industry Rewards
segment (60% of final Rewards score). This is to reflect the fact that when it comes to long term investment potential, industry size
and growth potential carry the most weight in indicating opportunities, with other structural factors (demographic, labour statistics
and infrastructure availability) weighing in, but to a slightly lesser extent. In addition, our focus and expertise in Emerging and
Frontier Markets has dictated this bias towards industry size and growth to ensure we are able to identify opportunities in countries
where regulatory frameworks are not as developed and industry sizes not as big (in USD terms) as in developed markets, but where
we know there is a strong desire to invest.
Indicators, Rationale And Sources
MEDICAL DEVICE RISK/REWARD INDEX, INDICATORS

Indicator Rationale Source
REWARDS
Industry Rewards
Denotes breadth of the medical device market. Larger markets score higher than smaller Fitch Solutions
Sales, USDmn
ones. Forecast
Sales Per Capita, Denotes depth of the medical device market. High value markets score higher than low Fitch Solutions
USD value ones. Forecast
5 Year CAGR, Denotes the projected performance of the medical device market. Markets with higher Fitch Solutions
USDmn CAGRs score better than those with lower CAGRs. Forecast
Denotes medical device production within the medical device market. Markets with larger Fitch Solutions
Production, %
production capabilities score better than those with lower production capabilities. Forecast
Country Rewards
Evaluates medical device demand associated to population size. Countries with larger Fitch Solutions
Population, mn
populations score higher. Forecast
Evaluates long-term prospects associated to population growth. Fast-growing countries Fitch Solutions
Population, % y-o-y
suggest better long-term growth across the medical device industry and score higher. Forecast
Evaluates proportion of the population 65+ as an expenditure ratio. Countries with ageing Fitch Solutions
65+ Years, %
populations tend to have higher per capita medical device expenditure and score higher. Forecast
Evaluates urbanisation as a proxy for development of medical facilities. Predominantly urban Fitch Solutions
Urban Population, %
countries score higher than rural countries. Forecast
RISKS
Industry Risks
Evaluates health policies, health insurance coverage, health expenditure and access to
Fitch Solutions
Healthcare Access health resources, activity and personnel. Markets with a good healthcare access score
Subjective Indicator
higher.
Evaluates the strength of the competent authority, national regulations and regulations Fitch Solutions
Regulation
aligned regionally, if existing. Markets with a strong regulation score higher. Subjective Indicator
Evaluates the level of government spending on medical devices and the attractiveness of
Fitch Solutions
P&R P&R policies. Markets with good government spending and friendly P&R policies score
Subjective Indicator
higher.
Country Risks
The LT ERI takes into account the structural characteristics of economic growth, the labour
Fitch Solutions
L-T Economic market, price stability, exchange rate stability and the sustainability of the balance of
Country Risk Index
payments, as well as fiscal and external debt outlooks for the coming decade.
The ST ERI seeks to define current vulnerabilities and assess real GDP growth, inflation,
Fitch Solutions
S-T Economic unemployment, exchange rate fluctuation, balance of payments dynamics, as well as fiscal
Country Risk Index
and external debt credentials over the coming two years.
The LT PRI assesses a country's structural political characteristics based on our assumption Fitch Solutions
L-T Political
that liberal, democratic states with no sectarian tensions and broad-based income equality Country Risk Index
Indicator Rationale Source
exhibit the strongest characteristics in favour of political stability, over a multiyear

timeframe.
The ST PRI assesses pertinent political risks to investment climate stability over a shorter Fitch Solutions
S-T Political
time frame, up to 24 months forward. Country Risk Index
The ORI focuses on existing conditions relating to four main risk areas: Labour Market, Trade Fitch Solutions
Operational Risk
and Investment, Logistics, and Crime and Security. Operational Risk Index
Fit
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Q3 2019

Industry Risk/Reward Index ....................................................................................................................................................49

Industry Trends And Developments .....................................................................................................................................64

Regulatory Development ..........................................................................................................................................................69

Medical Devices National Manufacturers .........................................................................................................................................................................71

Medical Devices Methodology.................................................................................................................................................83

PROJECTED MEDICAL DEVICE MARKET, 2018-2023

Total (USDmn) 1,277.3 1,390.5 1,524.5 1,678.9 1,853.1 2,045.8

Per Capita (USD) 13.2 14.3 15.5 16.9 18.5 20.2

Source: National Statistics, Fitch Solutions

Latest Updates And Key Forecasts

Weaknesses • Small elderly population

Opportunities • The Communist Party of Vietnam's commitment to market-oriented reforms

Threats • Weak currency keeping import costs high

Medical Device Market, Local Currency

Source: National Statistics, Fitch Solutions

Medical Device Market, US Dollar

Source: National Statistics, Fitch Solutions

The market will benefit from key drivers:

Market growth will be constrained by:

MEDICAL DEVICE MARKET BY PRODUCT AREA, 2013-2023 (USDMN)

Source: National Statistics, Fitch Solutions

Consumables Market, Local Currency

Source: National Statistics, Fitch Solutions

Consumables Market, US Dollar

Source: National Statistics, Fitch Solutions

Bandages & Dressings

Syringes, Needles & Catheters

CONSUMABLES MARKET, 2013-2023 (USDMN)

Medical dressings (non-

SYRINGES, NEEDLES &

Tubular metal needles/needles

Other needles, catheters,

Source: National Statistics, Fitch Solutions

Diagnostic Imaging Forecast

Diagnostic Imaging Market, Local Currency

Source: National Statistics, Fitch Solutions

Diagnostic Imaging Market, US Dollar

Source: National Statistics, Fitch Solutions

Imaging Parts & Accessories

DIAGNOSTIC IMAGING MARKET, 2013-2023 (USDMN)

IMAGING PARTS &

Other imaging parts &

Source: National Statistics, Fitch Solutions

Dental Products Market, Local Currency

Source: National Statistics, Fitch Solutions

Dental Products Market, US Dollar

Source: National Statistics, Fitch Solutions

Instruments & Supplies

DENTAL PRODUCTS MARKET, 2013-2023 (USDMN)

Source: National Statistics, Fitch Solutions

Orthopaedics And Prosthetics Forecast

Orthopaedics & Prosthetics Market, Local Currency

Source: National Statistics, Fitch Solutions

Orthopaedics & Prosthetics Market, US Dollar

Source: National Statistics, Fitch Solutions

Other Artificial Body Parts

ORTHOPAEDICS & PROSTHETICS MARKET, 2013-2023 (USDMN)

Source: National Statistics, Fitch Solutions