Pharmaceutical industry finds it difficult to solve the consumption problem

The Vietnamese medicinal herbs industry faces challenges in developing growing areas, applying science and technology, ensuring quality standards, etc. to compete with the global medicinal herbs market.

There are many weaknesses

Currently, the demand for medicinal herbs and medicinal products to protect health is increasing, such as Ngoc Linh ginseng, Lai Chau ginseng, Bo Chinh ginseng... However, to develop the medicinal herbs industry with high economic value, manufacturing enterprises still face many difficulties in medicinal herb growing areas, fragmented production...

Dr. Ha Thi Loan, Deputy Director of the Ho Chi Minh City Biotechnology Center, informed that Vietnam has 5,117 medicinal herbs, most of which are used as medicines in traditional medicine, but the number of medicinal herbs used to extract active ingredients for medicine is still modest, only about 50 species.

Vietnam's ability to exploit medicinal herbs is still low.

In addition, Vietnam harvests 10,000 tons of medicinal herbs every year but still has to import 40,000 tons, of which 80% is imported from China. It can be seen that Vietnam's medicinal herb resources have not been exploited and developed in the most optimal way.

On the manufacturing side, Mr. Lu Nguyen Xuan Vu, General Director of Xuan Nguyen Group Joint Stock Company, said that Vietnamese brands are still not widely known and are not trusted for their quality. A typical example is with ginseng honey products, consumers still look to buy imported products from Korea to use even though many Vietnamese products are not inferior in quality. This is a difficulty for businesses developing medicinal products in general and Xuan Nguyen in particular.

Also with honey products, Vietnam is the second largest honey exporter in Asia and exports to Korea, the US and many other countries. However, the current selling price of a ginseng honey product in Vietnam is only 35-40% compared to imported products but is still difficult to sell.

Not only is it difficult to win over Vietnamese consumers, one of the reasons why Vietnamese medicinal herbs only account for a very small share of the global medicinal herbs market is because most of Vietnamese medicinal herbs are exported in raw material form. In addition, there is still a proportion of medicinal herbs that do not meet the prescribed quality standards.

According to Mr. Vu, Xuan Nguyen currently exports to a number of markets such as China, Thailand, Indonesia, etc. and is looking for a distributor to distribute products to the Vietnamese market in the US. However, the export volume of raw materials accounts for 90% and branded products only accounts for 10%.

“The numbers are very different. In terms of growing areas and standards, the company ensures adequate quality and quantity. However, in terms of machinery and equipment, deep processing technology in Vietnam in general and Xuan Nguyen in particular is still limited,” Mr. Vu confided.

In addition, according to businesses, investing in building growing areas is difficult, but output is even more difficult. Ms. Tran Thi Lanh, a member of An Phuc Khang Cooperative (Quang Son district, Dak Nong province) shared: "Initially, we planted ginseng in Dak Nong province, but after harvesting, the facility could not find a buyer, and we sold 1-2 out of 10 products, so we did not dare to invest further."

Enterprises want to have investment policies for raw material areas, factories and expanding consumer markets.

Need support policy

Currently, the world's demand for medicinal materials is about 200 - 300 billion USD, but no Vietnamese enterprise has been able to participate in this potential market. Vietnam's medicinal material export has only stopped at a few hundred million USD/year.

Therefore, according to Dr. Ha Thi Loan, to increase the export turnover of medicinal herbs, Vietnam needs to form specialized, concentrated and large-scale medicinal herb production areas. At the same time, the origin and quality of products must be managed according to the standards of the World Health Organization...

Currently, in order to proactively participate in the global playground, the Ministry of Health has consulted the Prime Minister to approve the Program for developing the pharmaceutical and medicinal materials industry produced domestically until 2030, with a vision to 2045.

There are many specific policies to support pharmaceutical enterprises such as: Prioritizing investment in scientific research, production of high-quality medicinal herbs, improving competitiveness, international cooperation and integration, information and communication... This will be an opportunity for Vietnamese pharmaceutical enterprises to take advantage of opportunities, promote investment to exploit the market in the coming time.

According to Mr. Lu Nguyen Xuan Vu: “Access to loans to invest in growing and producing areas is already very difficult. Xuan Nguyen is currently unable to borrow capital from banks in Ho Chi Minh City because the collateral is local medicinal and agricultural growing areas. Therefore, our only solution is to access capital in the form of individuals with high interest rates, without incentives…”

To increase market penetration, Xuan Nguyen has invested extensively in factories and raw material areas with new production directions. Specifically, in the fourth quarter of 2024, the company will put a new factory into operation to focus on developing 6 lines of canned soft drinks. Including medicinal product lines that are renewed from previous concentrated products such as: Ginseng honey, Cordyceps honey.

“Therefore, we hope that the Departments and agencies will have policies to support capital and national pharmaceutical brand communication so that Vietnamese enterprises can increase their competitiveness with international brands,” Mr. Vu hopes.

Source: https://baodautu.vn/nganh-duoc-lieu-kho-giai-bai-toan-tieu-thu-d219949.html