“The race” to build EU-GMP factories of pharmaceutical companies

VietTimes – Translation Covid-19 not only affects the supply of raw materials, but also the progress of building EU-GMP pharmaceutical factories of domestic enterprises.


As a pure Vietnamese enterprise, Pharbaco will become the most formidable player in the Vietnamese pharmaceutical market after the newly built super factory is recognized with EU – GMP standards.

According to SSI Securities JSC (SSI), the demand for raw materials for pharmaceutical production in Vietnam depends on 80 – 90% on imported sources. This is always a long-term problem for Vietnam. Because, to produce medicinal herbs requires a lot of investment and need to be capable of technology (Vietnam does not have a competitive advantage compared to other countries, such as China and India).

In the context of complicated epidemic Covid-19, pharmaceutical enterprises will suffer many negative impacts on the supply of raw materials. The impact more or less will depend on the raw material storage policy of each business.

But the Covid-19 epidemic is making a significant impact on the progress of the domestic pharmaceutical enterprises to develop EU-GMP standard pharmaceutical factories. This is due to the fact that the movement of experts and partners across countries has been constrained by the disease, hindered development, and validated standards.

According to SSI statistics, as of November 30, 2019, the number of production lines or factories meeting EU – GPM / Japan – GMP or PIC / s production quality standards reached 19 out of 203 factories. pharmaceutical products belonging to more than 170 domestic pharmaceutical manufacturing companies and multinational companies.

SSI’s assessment of high quality products will be a competitive advantage for domestic pharmaceutical companies.

Group 1 and 2 drugs are still the private “playground” of foreign companies

Specifically, the Circular clearly states that in Groups 5 and 2, imported drugs may not be allowed to bid if domestically produced drugs meet WHO-GMP and EU-GMP standards respectively for the same activity. key substances (API), and if the production capacity of the company can fully meet the demand.Date 1 October 2019, Circular 15/2019 / TT-BYT of the Ministry of Health regulates the bidding Officially effective public health establishments. This is the revised circular of Circular 11/2016 / TT-BYT previously issued by the Ministry of Health.

In addition, public hospitals and clinics in Vietnam will not bid for imported drugs that are covered by the state budget or health insurance fund. Medical facilities will not be invited to bid for imported drugs if there are at least 3 domestic pharmaceutical companies that are able to supply these drugs for treatment and meet the standards of price and availability.

SSI assesses that public bidding regulations for drugs are an advantage for drug manufacturers in Vietnam that meet high production quality standards. At the same time, this policy also aims to encourage foreign drug processing, as well as technology transfer of foreign medicines, for production in Vietnam.

Among listed companies, Imexpharm Pharmaceutical JSC (Ticker: IMP) and Pymepharco JSC (Ticker: PME) are those companies that have achieved EU – GMP certification for 2 production lines, while Hau Pharmaceutical JSC. Giang (Ticker: DHG) is certified for both PIC / s and Japan-GMP standards.

In addition, as VietTimes mentioned, Central Pharmaceutical Joint Stock Company I (Pharbaco – Ticker: PBC) is also building a project of a pharmaceutical factory with EU – GMP standard.

Pharbaco is one of the few domestic companies implementing the project of a pharmaceutical factory meeting EU – GMP standards by itself without the participation of foreign shareholders like many other companies.

Currently, Pharbaco has implemented phase 1 of the project with a total investment of 1,200 billion VND. Due to the impact of the Covid-19 epidemic, it is almost impossible for experts to come to Vietnam to coordinate machinery operation, however, Pharbaco still aims to complete and verify the EU – GMP factory in Q3 / 2020.

Overview of Pharbaco EU – GM Factory Project (Source: AT Bach Khoa)

Regarding the second phase of the project, Pharbaco is quickly planning to deploy, the total investment is expected to be about 800 billion VND. Funding for implementation is expected to be mobilized from strategic shareholders and bank loans.

Owning an EU-GMP factory will help Pharbaco’s pharmaceuticals qualify for bidding in groups 1 and 2 on the ETC channel (hospitals, clinics) and closer to the goal of becoming 1 in 10 enterprises. pharmaceutical products with the largest production in Vietnam.

According to a report by Mirae Asset, this unit estimated that the total value of Vietnam’s pharmaceutical industry in 2019 reached about 6.95 billion USD, up 11% compared to 2018. In which, imported drugs still dominate the pharmaceutical market. Therefore, the possession of an EU-GMP factory helps to redistribute the market share of the pharmaceutical industry in Vietnam.

By 2020, the Ministry of Health aims to increase domestic drug consumption to 22% in central hospitals, and to 50% and 75% in hospitals.

Pharbaco Pharmaceutical exports millions of masks to the US

Central Pharmaceutical Joint Stock Company I – Pharbaco has just completed the first order of 1 million masks to the US, continuing to import more machines to increase capacity.

This is the first pharmaceutical enterprise in the North to be granted a license to export masks to the US market. Pharbaco’s first shipment was released on May 27 and cleared at Texas airport on May 31. Product will be delivered to all Texas county county hospitals.

The sole distributor of Pharbaco’s masks in Texas is RanierMed LLC. In order to be licensed to import all kinds of masks into the US, Pharbaco and its partners have sent samples and related documents to test the quality and technical indicators according to US standards. According to the schedule, every 10 days the company has a direct export to the US.

Antibacterial 4-layer Frog Mask manufactured by Pharbaco and exported to the US.

Mr. Ngo Nhat Phuong, Pharbaco’s General Director, said that the stressful epidemic caused the demand for masks in markets such as the US and Europe, opening up export opportunities for Vietnamese enterprises. Many units can export export masks, but lack of certificates because they do not meet American standards, making it difficult to enter the market.

Pharbaco’s mask products are certified FDA (US Food and Drug Administration), CE quality test certificate, and passed the US standard ASTM test level 1,2,3. Experts from the US have come to the site to inspect the factory, the production line, bring the mask sample to the US for analysis, evaluation and quality testing. “Pharbaco negotiating, working and implementing quality testing results in the US took place within 2 months,” said Mr. Phuong.

Pharbaco’s masks are FDA and CE certified for export to the US.

In addition to the export “Frog Mask” 4 layers of antibacterial, Pharbaco also has high-quality N95 masks and other special masks.

As a long-time enterprise operating in the pharmaceutical industry, the representative of Pharbaco said that the expansion to export production did not face too many difficulties in terms of machinery and human resources, the most important factor still lies in the stage of guaranteeing. quality assurance. Materials are imported by Pharbaco from Korea, Germany and the machinery system originating from Korea and Taiwan. Pharbaco’s factory with current capacity is capable of producing 83 masks per minute in one machine with a capacity of 20 million masks a month.

Facing great demand from domestic and foreign markets, the company is importing more machines urgently to improve production capacity to meet customer needs. In addition to the US market, before that, Pharbaco also completed export orders to export masks to Poland and Hungary. The 5-layer mask products, N95 mask supplied by this company all meet the US FDA standards and the CE sales in Europe.

Established in 1954, Central Pharmaceutical Joint Stock Company I was formerly Pharmaceutical Factory I under the Vietnam Union of Pharmaceutical Enterprises (now Vietnam Pharmaceutical Corporation). In 2007, the company equitized into Central Pharmaceutical Joint Stock Company 1, one of the oldest pharmaceutical enterprises in Vietnam.

Pharbaco factory in Soc Son, Hanoi

Since equitization until now, Pharbaco has cooperated with many domestic and foreign partners to build many lines according to American and European standards, in coordination with research institutes, foreign universities, and pharmaceutical corporations. to transfer technology to manufacturing and outsourcing production at Pharbaco factory.

“Pharbaco wishes to improve the quality of Vietnam’s pharmaceutical industry, contribute to the implementation of national pharmaceutical security, replace imported goods and bring drugs with European standards”, the company representative expressed. .

Pharbaco factory has 23 experts from the US, Germany, Poland … are training and training a team of technical experts. It is expected that by 2020, Pharbaco will have a total of 6 lines recognized according to European and American standards.

In April, a number of Vietnamese garment enterprises turned to export masks to export to America and Europe. Not stopping at masks, many units also invest in machinery switching lines, and produce medical protective suits for epidemic prevention. This product is opening up a good export direction for enterprises in the context of the unpredictable Covid-19 in the world.

Pham Van

The “transformation” of Pharbaco

VietTimes – Asset size increased by times, revenue reached trillion, Central Pharmaceutical Joint Stock Company I (Pharbaco – Ticker: PBC) had a strong transformation when it went to private hands. In addition, Pharbaco also holds great ambitions with the project of a drug factory that meets GMP – EU standards.

Pharbaco Head Office at 160 Ton Duc Thang, Hanoi

On June 27, about half a year after “going public”, Central Pharmaceutical Joint Stock Company I (Pharbaco) successfully held the 2020 annual General Meeting of Shareholders (GMS). 222 shareholders, representing 38.8 million shares, accounting for 97.11% of the total outstanding voting shares.
The large number of attending shareholders partly showed the great concern of investors in the market for Pharbaco – the “rookie” of the newly listed pharmaceutical industry, raising ambitions to become one of 10 pharmaceutical enterprises. has the largest production in Vietnam.

At the meeting, shareholders approved a plan to issue 50 million shares (the value of the issue at par value is 500 billion dong) to clear the debt for some creditors who lent the company. This activity helped Pharbaco increase its charter capital to VND 900 billion, balance the capital structure, reduce financial leverage, and consolidate its position with credit institutions.

Notably, the creditors named (Huong Que Trading Investment Joint Stock Company, Appollo Joint Stock Company or Saigon Pharma JSC) were all major shareholders of Pharbaco before going on the exchange. The debt swap also allows these creditors to convert their investment by owning shares of the company.

Established in 1954, formerly known as TW1 Pharmaceutical Factory, Pharbaco is an industry enterprise with a long history, affirmed its position and prestige in the market.

After equitizing and then “going back to” privately since 2015, Pharbaco is one of the few pharmaceutical companies that still retains the old “identity” instead of pursuing “golden land games”. The size of the company’s total assets and business results have also been improved each year.

By the end of 2019, the size of Pharbaco’s total assets reached 1,868.6 billion VND, 4 times higher than the end of 2015. Regarding business activities, in 2019, Pharbaco’s revenue reached 989.5 billion VND 10.5 billion of profit after tax – many times higher than the level of VND 1.3 billion in 2015. In 2020, Pharbaco reaches the target of VND 1,000 billion in revenue and 20 billion in profit after tax. copper.

With the help of resources and people from a group of private shareholders, Pharbaco is gradually “removing” old, outdated factories towards ambitious goals and catching up with trends in the pharmaceutical sector.
In 2019, creditors who have many connections with Mr. Ngo Nhat Phuong lent Pharbaco up to a hundred billion dong without taking interest (0% interest rate). The loan also has no collateral. The entire amount is used for the purpose of implementing a project to build a pharmaceutical manufacturing plant meeting GMP – EU standards.

Phase 1 of the project has been built since 2018, with a total investment of 1,200 billion VND, including 2 lines of Non Betalactam tablets (624 billion VND) and a line of injectable Cefalosporin and tablets (576 billion VND). By the end of January 2020, all machinery and equipment of the supplier have arrived at the company.

However, the outbreak of Covid-19 has greatly affected the progress of the project. It is almost impossible for experts to come to Vietnam to coordinate machine operation, commissioning, and forced online support. However, Pharbaco still aims to complete and complete the appraisal of the GMP – EU factory in Q3 / 2020.

The development of the second phase of the project, with a total estimated investment of VND 800 billion, is also urged by Pharbaco to plan the implementation. Funding for implementation is expected to be mobilized from strategic shareholders and bank loans.

Owning a GMP-EU factory will help Pharbaco’s pharmaceuticals qualify for bidding in groups 1 and 2 on the ETC channel (hospitals, clinics) and closer to the goal of becoming 1 in 10 enterprises. pharmaceutical products with the largest production in Vietnam.

Notably, Pharbaco is one of the few domestic enterprises implementing the project of pharmaceutical factories meeting GMP – EU standards by themselves without the participation of foreign shareholders like many other companies.

On May 19, 2020, Appollo Joint Stock Company sold 9.9 million shares of PBC to Hai Ha Waterway Transport Co., Ltd., reducing its ownership in Pharbaco from 26.63% to 1.88%. Authorized capital.

Pharbaco’s new major shareholder – Hai Ha Waterway Transport Company Limited – was established in September 2003, and is now led by Mr. To Van Tho (SN 1959, residing in Diem Dien town, Thai Thuy district, Thai province). Binh) is the Chairman of the Board of Members./.