The Indonesian regulations seemed straightforward until we dug deeper. A Fortune Global 500 client was planning their market entry strategies, confident they had ticked all the regulatory compliance boxes. However, the reality on the ground was far more complex. The official pharma regulation stated one thing, but the unwritten rules of implementation at the National […]
Vietnam's pharmaceutical industry is rapidly emerging as a strategic hub for global healthcare investment, demonstrating impressive annual growth. This expansion makes it an attractive destination for foreign investors looking for significant opportunities.
This growth is driven by a strong government commitment to achieving self-sufficiency, creating a fertile ground for foreign direct investment (FDI) into the pharmaceutical sector.
For investors and multinational pharmaceutical companies, the recent introduction of clearer, more investor-friendly new regulations presents a timely opportunity in the Vietnamese pharmaceutical market.
This guide provides a practical, hands-on roadmap for navigating the process of establishing a pharmaceutical manufacturing facility in Vietnam. Drawing from deep experience in Vietnamese pharmaceutical law and GMP compliance, this article breaks down the regulatory landscape, procedural steps, and critical success factors to ensure any pharmaceutical company can make its market entry both efficient and compliant.
Key Takeaways:
- Vietnam’s pharmaceutical sector is expanding at over 10% annually, supported by favorable government policies.
- The Ministry of Health (MOH) and the Drug Administration of Vietnam (DAV) are the primary regulatory authorities.
- Establishing a facility requires obtaining an Investment Registration Certificate, Business Registration Certificate, conducting an Environmental Impact Assessment, and securing a Certificate of Eligibility (CoE) and Good Manufacturing Practices (GMP) certification.
- Certain research and clinical trial facilities are exempt from needing a Certificate of Eligibility for their business activities.
- Adherence to Good Manufacturing Practices in facility design and operations is mandatory for all pharmaceutical manufacturers.
Regulatory Overview and Key Authorities
Navigating Vietnam’s pharmaceutical landscape requires a clear understanding of its governing bodies and legal statutes. The two principal regulatory authorities are the Ministry of Health (MOH), which sets overarching policy, and the Drug Administration of Vietnam (DAV), which is the competent authority for day-to-day administration, licensing, and inspections.
Experience has shown that early, transparent engagement with these bodies is crucial for a smooth approval process.
The legal foundation for a pharmaceutical business is built on core regulations, including the Pharmacy Law passed by the National Assembly. It is essential to review all relevant legal documents to understand the legal requirements.
According to the official government portal for legal documents, Decree 163/2025/ND-CP details the comprehensive framework and specific conditions for a pharmaceutical business, making this ND-CP a cornerstone document for any investor's business plans.
Licensing and Activity Classification
A critical first step for any pharmaceutical company is to correctly classify its intended operations. The regulations make a clear distinction between general pharmaceutical activities and specific pharmaceutical manufacturing. This classification determines the precise and specific licenses your facility will require.
A facility focused solely on packaging, for instance, has different obligations than one involved in producing active ingredients from raw materials. Misclassifying your business activity can lead to significant delays.
Step-by-Step Procedure to Establish a Manufacturing Facility
Launching a manufacturing facility in Vietnam follows a structured, multi-stage process. A disciplined, sequential approach is essential for a successful pharmacy business establishment.
Step 1: Secure Investment and Enterprise Certificates
Your first official step is to complete the business registration process. This involves obtaining the Investment Registration Certificate (IRC) and the Business Registration Certificate (ERC). These are issued by the provincial Department of Planning and Investment (DPI) where your facility will be located. This stage formalizes the legal presence of your pharmaceutical company, whether as a limited liability company or a joint stock company.
Step 2: Environmental Impact Assessment and Construction Permits
Before breaking ground, you must conduct a thorough Environmental Impact Assessment (EIA) according to Law On Environmental Protection 2020. The report must be approved by the relevant authorities. Simultaneously, your facility designs must be finalized to be fully compliant with Good Manufacturing Practices (GMP), a prerequisite for obtaining construction permits.
Step 3: Apply for the Certificate of Eligibility for Pharmaceutical Business (CoE)
Once construction is underway, you can apply for the Certificate of Eligibility for Pharmaceutical Business (CoE). Mandated under the governing ND-CP, this is the primary license authorizing you to conduct pharmaceutical activities.
Step 4: Undergo Good Manufacturing Practice (GMP) Inspection
After construction is complete and equipment is installed, the facility must undergo a rigorous GMP inspection conducted by the DAV. The process for this inspection is detailed in Circular 28/2025/TT-BYT, which outlines the official standards for pharmaceutical manufacturing in Vietnam. Achieving GMP certification confirms your facility meets international quality standards. The registration process requires submitting detailed technical documents.
Step 5: Obtain Marketing Authorization (MA)
The final step in the drug registration process is to apply for Marketing Authorization (MA) for each specific drug you intend to produce according to Circular 12/2025/TT-BYT. This allows your registered drugs to be sold in the market.
A key strategic insight is the parallel execution of Steps 2 and 3. By preparing the CoE application while the EIA and construction permitting processes are in progress, you can often shorten the overall registration process.
Facilities Not Subject to the Certificate of Eligibility
Not all pharmaceutical manufacturing requires a full Certificate of Eligibility. This is a crucial distinction that can save significant time and resources. According to Circular 31/2025/TT-BYT, facilities engaged in non-commercial business activities are exempt.
These exempt facilities include:
- Research, testing, or training centers that use raw materials to compound pharmaceutical products for non-commercial purposes.
- Hospital or clinical trial facilities that manufacture drugs for in-house use or for R&D.
- Facilities producing pharmaceutical raw materials exclusively for research.
It is critical to note that while these establishments may not need a CoE, they must still meet fundamental safety and personnel requirements.
GMP Compliance and Facility Design Essentials
Achieving and maintaining GMP compliance is non-negotiable and forms the backbone of any pharmaceutical manufacturing operation. The DAV enforces these standards, often aligned with World Health Organization guidelines, with renewal audits conducted every three years.
Layout and Zoning: Your facility design must incorporate clean room hierarchies, controlled flows for materials and personnel, and robust systems to prevent cross-contamination in all production processes.
Personnel: All staff must be appropriately qualified and possess documented training records. This ensures high quality standards across the board.
Validation: Before commercial production, all critical equipment and processes require validation. This system of quality assurance is essential for ensuring product quality and safety, from raw materials intake to the final pharmaceutical product.
Key Considerations and Conclusion
Successfully launching a facility requires meticulous planning. The most common pitfalls include EIA delays and non-compliant GMP layouts. To mitigate these risks, early engagement with local Health Departments is recommended. Working with a reputable law firm can help foreign companies navigate these complexities.
The Vietnamese market offers vast potential for pharmaceutical companies, including those producing generic drugs and utilizing advanced technology. The government often provides tax incentives to encourage investment in the pharmaceutical industry.
As the market matures, opportunities for distributing drugs will grow for both domestic enterprises and foreign pharmaceutical companies. Whether you form a joint stock company or a representative office, understanding the local landscape is key.
The future of the pharmaceutical industry in Vietnam is bright, supported by a government eager to foster a world-class manufacturing ecosystem.
Frequently Asked Questions
What Are the Most Critical Regulations I Need to Know for Setting Up a Pharma Facility in Vietnam?
The three most important legal frameworks are the Pharmaceutical Law, Decree 163/2025/ND-CP, which outlines the conditions for a pharmaceutical business, and Circular 28/2025/TT-BYT, which specifies the mandatory Good Manufacturing Practices (GMP) standards.
How Long Does the Entire Process of Establishing a Manufacturing Facility Typically Take?
A realistic timeline is 18 to 24 months from the initial Investment Registration Certificate to obtaining Marketing Authorization for your first pharmaceutical product. This can be shortened by running the environmental assessment and CoE application processes in parallel.
Should I Hire a Local Consultant or Can My Global Team Manage the Process?
While your global team provides technical expertise, navigating the specific regulatory requirements of the Ministry of Health and local authorities is challenging. A hybrid approach combining global standards with a local law firm or consultant often yields the most efficient and compliant outcome for foreign companies.
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