Vietnam is one of the new Asian tigers. With a population of about 86 million, it is the third-largest country by population in Southeast Asia and the 13th largest in the world. According to the International Monetary Fund, from 2000 to 2008, its economy grew at an average annual rate of about 7.5%-one of the highest rates in Asia. Vietnam is currently attracting a great deal of foreign investment, especially from foreign manufacturers that are relocating due to rising wages in coastal and southern China.
The medical device market is one of the many beneficiaries of this growth. The Vietnamese government has also helped fuel development by upgrading the country’s medical infrastructure. About 70% of medical device purchases made in Vietnam-measured in terms of value-go to public hospitals. Private hospitals are a minority in the country, but are also seeing growth.
Most devices made by local Vietnamese companies are very low-tech, such as gloves, bandages, and syringes. American and European medical device makers dominate the market, but more and more global medical device manufacturers are considering the country as a location for manufacturing-not just selling-their products. Omron and Olympus, two large Japan-based firms, have recently started production in Vietnam. For other manufacturers eyeing the market, this article describes the major regulatory requirements and what you need to know to complete Vietnam medical device registrations.
The main Vietnamese government ministry with authority over healthcare affairs is the Ministry of Health (MOH). Within the MOH, the Department of Medical Equipment and Health Works (DMEHW) regulates medical devices specifically. In addition, the Ministry of Science and Technology (MOST) performs some regulatory functions relevant for domestically made medical devices.
An important fact about Vietnam medical device registration is that the basic process is different for imported devices than for domestically manufactured devices. Technically, imported devices do not need product registration at all, just an import license. Domestic devices, on the other hand, do generally require product registration. Additionally, IVDs are regulated as drugs in Vietnam only if they contain biological substances. Otherwise, they are regulated as medical devices.
Under Vietnamese law, only selected medical device types require import licenses in order to be imported and sold in Vietnam. These product types are listed as follows:
- Medical devices to be implanted into the human body, or which replace or supplement a physical function.
- Fifty-seven types of medical devices specifically listed in Appendix 7 to the MOH’s Circular No. 08/2006/TT-BYT, issued June 13, 2006.
- Devices that have a new function or new therapy, or devices that are being imported to Vietnam for the first time.
In theory, medical devices that do not fall into the above categories could be imported into Vietnam freely, as long as relevant taxes and tariffs are paid. However, in practice, it is very common for Vietnamese customs officials to ask many technical questions about any devices without import licenses. To keep this from delaying your products’ entry into Vietnam, it is highly recommended that you put together dossiers with the same information that would be submitted for import licensing, and have them available to help all medical devices through customs.
The dossier information required for import licenses is as follows:
- Original catalog.
- Instruction manual and technical guide, including specifications (originals and Vietnamese translations).
- Manufacturer’s quality certificate: Either ISO 13485 certification or FDA/CE approval of the device manufacturing site.
- Free Sale Certificate from country of origin.
- Quality declaration letter.
It should be noted that the quality certificate is seen by the Vietnamese government as the most crucial qualification. Also, regulators highly value ISO 13485 certification. If no ISO 13485 certification is submitted, the Free Sale Certificate will be scrutinized more closely.
The DMEHW will typically grant an import license within 15 working days of receiving an application dossier, unless clinical trials are required. This may be the case if a medical device has a new function, a new therapy, or is the first of its type to be imported into Vietnam.
Foreign clinical trials can be accepted for Vietnam medical device registration, but they must also have been accepted by the foreign country’s medical regulatory agency and be registered in the country of origin. Also, the MOH’s Science and Technology Council must examine and approve the foreign clinical trial results.
If the MOH decides that clinical trials must also be conducted in Vietnam for the product to be approved, the manufacturer or distributor will not be the sponsor of the trials. Rather, the MOH will organize and conduct the trials itself, typically in three or more hospitals. Depending on the product being tested, trials may take 3-12 months to complete, or more in some cases.
If clinical trials are required, and no trials have been performed inside or outside of Vietnam, the DMEHW will arrange them. The applying company is responsible for preparing clinical trial protocols. At the end of the trial, the hospitals will pass the results back to the DMEHW and the applicant. The applicant should then resubmit the application with the trial results. The DMEHW will issue its decision within another 15 working days.
License Fees and Renewals
The license fee is 200,000 Vietnamese dong (VND), or about $11 (U.S.). It may be possible to bundle multiple products together into one application for convenience, but the license fee will be assessed per product.
Import licenses are valid for only one year. They must be reapplied for every year and cannot be renewed. Although approval usually takes about 15 working days, it is recommended to apply with more lead time before the existing license expires, in case of unexpected delays.
In many cases, changes to the product require completely new import license applications. Examples of such a change include a changed product name or changed country of manufacture. However, switching to a different manufacturing site within the same country as specified in the application does not require a new import license.
Medical devices manufactured in Vietnam require product registration prior to sale. First, a manufacturer must make a quality announcement to a branch of the MOST. Then an application must be submitted to the DMEHW for Vietnam medical device registration.
There are two types of quality announcements: the Announcement of Standard Conformity (ASC), which applies to selected higher-risk medical devices, and the Announcement of Quality Standards (AQS), which applies to other, lower-risk medical devices. The ASC is an announcement of compliance with ISO or IEC standards. Both the Directorate for Standards Metrology and Quality (part of MOST) and the Institute of Medical Equipment and Works Design will review the ASC. The process takes about 60 working days.
The AQS is a simpler announcement that is filed with a Provincial Branch of Standards and Quality (also part of MOST). The AQS may announce conformity with any set of quality standards-Vietnamese, international, or even a company’s in-house standards. It takes about 15 working days.
Once the ASC or AQS has been accepted, the applicant can submit an application for Vietnam medical device registration to the DMEHW. The application must contain a notarized copy of the manufacturer’s business registration certificate, the ASC or AQS, plus technical documents and user instructions. For some types of devices, the results of chemical, physical, and safety tests are also required. In some cases, clinical trials may also be called for. The procedure for clinical trials for domestic medical devices is essentially the same as described earlier for imported medical devices.
Assuming all the necessary information has been provided, the DMEHW usually issues its approval decision within 15 days of the application. Product registration for domestically made medical devices is valid for three years. Although a procedure to renew registration exists, its documentary requirements are similar to the requirements for a new application. The registration fee is 300,000 VND, or about $17 (U.S.).
Tips for Facilitating Vietnam Medical Device Registration
While going through the Vietnam medical device registrationprocess, it is important to have an experienced agent in Vietnam handling the application for you. Although about 15 days is a common time frame for approval, it is not unusual for the process to be delayed if there is no local contact person who has the experience to resolve common issues with the government.
It is also necessary to maintain consistency among different regulatory documents. In particular, product names and descriptions, company information, etc. should be the same across your quality certification, registration application, and tax documents, which are required when bringing products through customs.
Structures for Medical Device Business in Vietnam
Vietnam’s accession to the World Trade Organization in 2007 opened up new possibilities for foreign medical devices firms operating in Vietnam. Foreign-owned companies are legally permitted to import, market, and physically distribute medical devices in Vietnam. By contrast, physical distribution of pharmaceuticals is still off-limits, though importing and marketing are allowed. Foreign-owned firms may also manufacture medical devices in Vietnam.
Relevant licenses for foreign companies wanting to manufacture medical devices in Vietnam include investment licensing, environmental and fire safety certification, and production and delivery system validation from the Center of Technical Audit. After receiving all of these approvals, medical device production approval must also be sought from the MOH. As of yet, there are no local GMP requirements for medical device manufacturing.
It should be noted that for both imported and domestically manufactured medical devices, it is not possible for companies outside of Vietnam to hold import licenses or a Vietnam medical device registration in their own name. The entity applying for and holding permits must be registered in Vietnam. This may be a distributor or the local subsidiary of a foreign company.
Vietnam Medical Device Reimbursement
The Vietnamese government reimburses hospitals for medical consumables. The government not only sets ceiling prices, which are sometimes priced low in order to prioritize local products, but it also sets the minimum number of times some products must be reused.
It is possible to lobby the Vietnamese government to reimburse additional products. However, adding new products for reimbursement is not a routine process in Vietnam. The MOH may be lobbied directly. It is also possible to lobby national hospitals to request MOH reimbursement.
Medical Device Procurement
Because the government is the principal buyer of medical devices in Vietnam, it is important to understand government procurement systems. Individual government hospitals can make purchases up to 100 million VND (about $5700) on their own authority. For larger purchases, there must be a formal bidding process. In many cases, bidding is organized on a provincial level or on a national level by the MOH.
Vietnamese purchasers highly value a supplier’s ability to install products, make periodic upgrades, and provide after-sale service. Products should also be adapted for a tropical climate. To enter some large tendering processes, companies are required to have a history of providing similar products in Vietnam over the previous two years.
The Future of the Market
Healthcare consumption is expected to increase as Vietnam gradually implements a universal healthcare system. Currently, 34 million Vietnamese are enrolled in a compulsory government health insurance plan. The government plans to expand the system so that it covers 100% of the population by 2014.
As a member of the Association of Southeast Asian Nations (ASEAN), Vietnam is a participant in the Medical Device Product Working Group (MDPWG). The MDPWG is almost done drafting a plan to harmonize medical device regulatory standards across ASEAN. This plan would make Vietnam’s regulatory system more similar to international models. It would also make it much easier to register a product simultaneously in Vietnam and in other Southeast Asian countries. Vietnam has made no formal commitment to the plan yet, but if the country does adopt it, implementation would probably take place around 2015.
Vietnam’s medical device market is estimated by several of our company’s sources to be worth about $250 million in 2009, and it is growing at a rate of about 10% annually. This high-speed growth makes the country an excellent prospect for long-term sales-assuming firms enter the market properly. Compared with Japan and China, Vietnam’s regulatory system is less cumbersome to manufacturers in terms of the documents required, costs, and time frames. However, expertise is still required to navigate Vietnam medical device registrations and regulations successfully.