Vietnam’s Ministry of Health Establishes New Procurement Rules for Drugs and Medical Devices

Vietnam’s Ministry of Health (MoH) has promulgated Circular 05/2024/TT-BYT, which details guidelines for acquiring pharmaceuticals, medical devices, and testing equipment through price negotiations. This move follows the 2023 Law on Tendering, effective since January 2024.

Over 600 drugs and 4 medical devices are now eligible for price negotiations, including original brand-name drugs and reference biologicals, and items made by one or two manufacturers.

The negotiation process is as follows:

  1. Public invitations and requests for proposals (RFPs) are issued on the Ministry’s online portal.
  2. Tendering parties have at least 18 days to submit their proposals.
  3. Proposals are assessed based on the RFP requirements.
  4. An expert team helps construct a negotiation scenario for approval.
  5. Negotiations occur through meetings or notifications to tendering parties.
  6. Selection results are published within 5 working days of approval.
  7. A framework agreement is signed with the chosen supplier.
  8. Health facilities contract with the supplier under the agreed prices in the framework.

The guidelines regarding price negotiation are as follows:

– Accept prices if they meet or are below expected levels.

– Request up to three price adjustments if proposals exceed expectations.

– Seek health facility opinions if proposed prices are high

The guidelines for scenarios in which price negotiation fails are as follows:

– Inform health facilities of alternative procurement plans.

– Restrictions on procuring original brand-name drugs or reference biologicals unless they are essential.

– Consider generic drugs with the same active ingredients.

Circular 05 was established to ensure fair pricing and efficient procurement. The MoH will make updates to the eligible items list every two years to accurately reflect current needs and criteria.

Written by: Ames Gross – President and Founder, Pacific Bridge Medical (PBM)
Mr. Gross founded PBM in 1988 and has helped hundreds of medical companies with regulatory and business development issues in Asia. He is recognized nationally and internationally as a leader in the Asian medical markets. Mr. Gross has a BA degree, Phi Beta Kappa, from the University of Pennsylvania and an MBA from Columbia University.