Healthcare Industry in Vietnam: Market Overview and Investment Opportunities

This page explains the key market dynamics, regulatory considerations, investment opportunities, and business practices that foreign investors and healthcare companies should understand before entering Vietnam’s healthcare sector.

Vietnam Healthcare Market

The changing demographics and increasing levels of income and expenditure are leading to greater private sector participation in Vietnam’s healthcare industry. At the same time, the public system is coming under greater pressure. With one of the fastest growing healthcare markets in Southeast Asia and increasing demand for hospitals, pharmaceuticals, medical devices, diagnostics and digital health, Vietnam is an area ripe for investment.

Investors see healthcare as more than a social infrastructure sector; it is a market for growth. There are a number of trends in healthcare that will shape the market for decades, and recognizing demand will help identify worthwhile investment opportunities.

Marketplace Data

Vietnam’s healthcare system is more than one or two silos. Its various segments are urbanizing at different rates, and this uneven market growth is exemplified in its pharmaceutical and medical device markets.

The Vietnamese pharmaceutical market is a leader in the region. Economists predict it will grow to 16.8 billion USD due to the demand for treatments related to an aging population and the increasing prevalence of chronic illnesses and oncological care. Among this growing market, therapies related to oncology are of particular interest.

The medical devices market is growing, as well. Industry forecasts predict that Vietnam’s medical devices market will be around 1.77 billion USD in 2025 and grow around 2.47 billion USD by 2029. This growth will allow Vietnam to become one of the leaders in medical technology in Southeast Asia. Currently, over 90% of medical devices in Vietnam are imported. This creates ample opportunities for foreign partners to establish joint ventures in this market.

Another market with ample business opportunities is digital healthcare. Analysts predict that Vietnam’s digital health market will be worth 815 million USD by 2026 and will grow thanks to telehealth, EMR, AI diagnostics, and healthcare data platforms. The move to a digital healthcare system will help create a double-digit growth environment in Vietnam’s digital healthcare market.

Preventive care and diagnostic services are also on the rise. As knowledge of the prevention of chronic diseases grows and employers invest extensive resources into employee health programs, the demand for health screening, laboratory tests, and preventive care is on the rise.

Each of these segments shows that the healthcare market is expanding and drawing the attention of domestic and foreign investors.

The Three Macro Drivers

There are three major trends that shape the long-term growth of the health care market in Vietnam.

An Aging Population

Vietnam is an aging society. It is expected that by 2025, 15% of the population will be over the age of 60. Life expectancy is also on the rise. There will be an increased need for management of chronic diseases, rehabilitation, specialized services, and geriatric care.

Increased Income and Increased Expenditure on Healthcare

As a result of economic developments, a greater demand for services is apparent. The expanding middle class of Vietnam allows for the greater consumption of healthcare services through private hospitals, clinics, specialized care, preventive services, and a greater array of medical services.

Healthcare spending has increased for each of the last ten years, and will continue to increase through 2030. It is anticipated that by 2030, healthcare spending will exceed USD 33 billion.

Constraints on Public Hospital Capacity

Vietnam’s public healthcare system continues to be the main provider for a majority of the population. However, its large hospitals are overcrowded, and its resources are drained. Large tertiary hospitals in Hanoi and Ho Chi Minh City struggle with high utilization, which negatively impacts both patient access and the quality of services offered.

There has been a significant expansion in national health insurance, covering over 94% of the population. While this development has improved access to healthcare, it has resulted in increased demand for healthcare services.

There is a combination of increased public spending on healthcare, aging demographics, and public hospitals becoming increasingly pressured, which are developing a sustained demand for almost all healthcare offerings.

Public and Private

Vietnam’s healthcare market has a significant mismatch between demand and the capacity of the private sector.

Over the last 20 years, the number of private hospitals has steadily increased. However, relative to public providers, private hospitals continue to provide a small portion of Vietnam’s healthcare infrastructure. Investors can take advantage of this gap in demand by offering quality healthcare services in modern facilities and specialized care.

The government continues to implement healthcare strategies that promote greater private sector participation as a way to relieve public healthcare demand. Investment priorities include:

• Private hospitals
• Specialist medical centers
• Private diagnostic networks
• Private rehabilitation facilities
• Private elderly care services
• Community healthcare models

The opportunities are beyond just hospitals. Vietnam has an increasing burden of non-communicable disease such as cardiovascular disease, diabetes, cancer that creates demand for long-term care, outpatient services, private diagnostics, and disease management services.

This structural discrepancy between the demand for healthcare services and the provision of healthcare capacity provides an explanation for why both domestic and international investors are focusing on Vietnam’s healthcare sector. Recent dealings of international healthcare and medical device companies show an even higher level of market confidence and the expected long-term development of the market.

Four Promising Sectors

The overall expansion of Vietnam’s healthcare system has driven uneven investment opportunities across various segments. It has become common for foreign investors to channel their interests in sectors that have strong growth prospects based on demographic shifts, the presence of supportive policies, and the closing of market gaps. Private health services, in particular, the four segments of interest are the healthcare services, the pharmaceuticals, the medical devices, and the digital health segments.

Private Hospitals, Specialist Clinics, and the Pharmaceutical Market

Private healthcare is one of the fastest growing segments of healthcare in Vietnam. While the majority of patients are still seen at public hospitals, the increasing disposable income and the growing demand for high-quality healthcare are driving the patients to private hospitals and specialist clinics.

The following segments are of particular interest:

• Oncology centers
• Cardiology clinics
• Orthopedic hospitals
• Women’s health and fertility clinics
• Dental and aesthetic healthcare services

To attract investments, Vietnam gives incentives to healthcare projects in designated priority areas. The healthcare projects are located in designated areas and based on the project structure, the projects can benefit from tax exemptions and other incentives. These policies have attracted both local and foreign healthcare operators.

The pharmaceutical market is another growing investment area. The growing demand is due to aging, increased chronic illness, and increased healthcare spending.

Rapidly expanding therapeutic areas include:

• Oncology
• Cardiovascular disease
• Diabetes management
• Respiratory treatments
• Neurology

The Vietnamese government prioritizes pharmaceutical independence. Their healthcare development plans aim to boost domestic pharmaceutical production and decrease the use of imported medicines. Because of this, foreign pharmaceutical companies can consider Vietnam to create local production, technology transfers, and future market opportunities.

Private healthcare and pharmaceuticals are among the largest and most established opportunities that international investors can find in Vietnam.

Medical Devices and Digital Health

These two sectors are among the most innovative and rapidly evolving sectors in Vietnam’s healthcare system.

Medical Devices

Vietnam’s medical device market is expected to reach nearly USD 2.47 billion by 2029. This is mainly a result of an increase in hospital construction, the modernization of healthcare, and an increased need for advanced technology in diagnostics and treatments.

More than 90% of the medical devices used in Vietnam are imported. Because of this, international manufacturers, distributors, and suppliers of healthcare technologies have numerous opportunities in the Vietnamese market.

The Vietnamese market is particularly promising for medical technology companies that want to expand in Southeast Asia. Compared to most of the other regional markets, import regulations are more relaxed in Vietnam.

Digital Health

Digital health is changing Vietnam’s healthcare delivery. In 2026, the market is expected to have generated USD 815 million in revenue. Growth figures are expected to be in the double digits in subsequent years.

Some forces driving this growth are:

Vietnam’s initiatives to digitize government healthcare

• Telemedicine
• Health digitization
• Electronic Health Records
• AI diagnostics
• Patient monitoring
• Healthcare apps

Vietnam’s national digital healthcare strategy is propelling many of these areas including the establishment of government programs to help digitize healthcare and build smart hospitals.

In conjunction with Vietnam’s extensive internet coverage, the country’s mobile device penetration, and demand for health services, empowers many healthtech startups.

For foreign investors, digital health is the opportunity beyond health platforms that include digital health services, health data, health analytics, cybersecurity, telehealth, AI health diagnostics, and medical health devices.

Digital health and medical devices together constitute the two fastest growing segments of health services Vietnam, creating many opportunities for foreign businesses.

Regulatory Framework, Investment Incentives, and Market Entry Routes

Healthcare services in Vietnam are poised for long-term growth. Sustainable investment depends on an understanding of the health services regulations. Foreign investment opportunities include hospitals, clinics, pharmaceuticals, medical devices, and healthcare technology. Each segment has prescribed licensing, ownership, and compliance structures.

Good news for potential investors: Vietnam has been easing restrictions on foreign investment in healthcare and adding incentives aimed at both local and foreign investors. Successful entry to the market requires a good deal of preparatory work, including the selection of an appropriate investment vehicle and an understanding of the regulations and timelines for formal approvals specific to each investment.

Tax Incentives, PPP Framework

Vietnam continues to recognize healthcare as a key investment area and is expanding investment incentives to foreign capital in order to consider private participation and develop healthcare resources.

The most beneficial of these available programs is the incentives related to the Corporate Income Tax (CIT). Invested healthcare project can receive reduced, preferential CIT and exemption CIT holidays depending on the project location, project scope, and the offered healthcare services. In specific situations, as an example, the healthcare investments can receive CIT at the level of 10% for a period of 15 years, with CIT exemption and reduction periods. These incentives are among the most beneficial in the investment law of Vietnam.

In comparison with other investment sectors, in healthcare, foreign investment is facilitated to a greater extent. There are no restrictions on foreign investment and foreigners can establish hospitals, clinics, and businesses of:

• Medical devices
• Diagnostics
• Health tech

This has a positive impact on the level of foreign direct investment in the Vietnamese healthcare market from healthcare service providers, medical device and technology firms, and private equity funds.

A key change has been the growing application of Public-Private Partnership (PPP) models. The healthcare PPP framework permits private sector participation and investment in the collaboration of government agencies for healthcare infrastructure, hospital management, and the delivery of healthcare services. As Vietnam aims to strengthen public healthcare facilities and meet increasing demand, healthcare PPPs will likely be used more for future public healthcare center investments.

Special incentives may also be available for projects in poorer provinces. These would help investors lower operational costs and also improve healthcare services outside the larger city centers.

Key Compliance Requirements

Although there are many opportunities for investments, healthcare is one of the most regulated sectors in Vietnam.

In the case of investment in hospitals and clinics, several approvals are required from the relevant authorities, including MOH and provincial health departments. Licensing requirements will look at the standards of the healthcare facility, the medical staff, medical equipment, systems for patient safety, and the healthcare facility’s operating procedures.

For medical devices, regulatory compliance is critical as most medical devices are required to undergo a registration or a prior market approval process for Vietnam. Classification of devices, the required regulatory documents, a technical dossier, and other compliance measures will affect the timeframe to market the medical device. Although improvements have been made to simplify some of the procedures, comprehensive compliance will still be necessary for medical device manufacturers and distributors.

The pharmaceutical sector has a more demanding approval process. Drug registration with the Drug Administration of Vietnam will require a dossier with extensive clinical, manufacturing, and safety and efficacy regulatory requirements, which will usually take a long time. Even with the current state of Vietnam’s regulatory system, there are improvements to be seen in clarifying the regulations and minimizing the administrative procedures.

It is also important for investors to assess the developments in the policy environment. Vietnam is continuously changing its healthcare regulations as its government attempts to strike an appropriate balance with regards to patient safety, healthcare accessibility, and industry growth. Changes in reimbursement policies or alterations to the processes for the regulatory approval of medical devices, medicines, or digital healthcare will impact the planning for market access.

For a number of foreign healthcare companies, early engagement with the regulatory environment is as important as the investment. If these companies understand the process of the regulatory approval for healthcare services, the licensing procedure, and the requirements for compliance early, this will increase the likelihood of successful market access.

Key Risks and Practical Considerations for Healthcare Investors

While the demand for healthcare in Vietnam continues to grow, the supply to meet that demand does not. Investors should consider the issues that this supply and demand imbalance presents to the profitability and scalability of their healthcare investments in Vietnam. Structural issues within the healthcare environment in Vietnam will impact the healthcare investor’s ability to achieve the returns that they expect from their investment.

Structural Challenges

Vietnam’s healthcare supply and demand imbalance presents the biggest issue for healthcare investors in Vietnam. While demand is growing, the supply of doctors, nurses, and healthcare workers has not. This is particularly concerning when considering the specialized workforce in oncology, rehabilitation, cardiology, and healthcare technology. Investors that want to build a hospital, clinic, or a digital health company should consider talent acquisition and retention as their core strategic priority.

Geographic inequalities can lead to both issues and prospects. The primary focus of private healthcare investment tends to be on Hanoi and Ho Chi Minh City. Meanwhile, secondary cities and rural areas are in need of quality healthcare. The underserved markets are in need of investment but do come with challenges due to their limited purchasing power and a lack of healthcare infrastructure.

Regulatory issues should also be taken into account. The healthcare industry is usually subject to longer waiting times to get business approvals when compared to other sectors. Licensing, facility approvals, medical device registrations, and pharmaceutical approvals can lead to delays when implementing healthcare related projects if these issues are not addressed proactively.

One of the barriers to implementing digital transformation in the healthcare sector is the lack of healthcare professionals who are trained in both healthcare and technology. As more hospitals implement electronic healthcare records, telemedicine, and AI-based solutions, the need for cross-trained professionals will drastically increase.

Investing in healthcare in Vietnam as an International Investor

The phased and partnership-based strategy has enabled a considerable number of international healthcare companies to launch their businesses in Vietnam, despite the barriers.

The partnership route tends to be with well-recognized local healthcare providers and hospital groups or with local healthcare distributors. These partnerships help reduce execution risk, and help get foreign investors to the market faster, as local partners usually have an understanding of the market, regulations, and established networks of patients.

Successful healthcare operators often tend to focus first on larger metropolitan areas, as these regions are generally associated with higher healthcare spending, better access to specialized talent, and more demand for higher-end healthcare services. For foreign investors, Hanoi and Ho Chi Minh City have traditionally been the most active regions for investment in private healthcare, and for the establishment of specialized clinics and advanced diagnostic services.

There are also new opportunities with medical tourism. As private healthcare services in Vietnam continue to improve in quality and remain more affordable than those in Singapore, Thailand and other competing regional hubs, they present opportunities to offer services to both local and foreign clientele.

For Vietnam’s healthcare market, medical device and pharmaceutical companies also tend to have the most success with measured market entry. A common method in the earlier phases of entry tends to be working with licensed wholesale distributors and/or local partners for larger and more direct market engagement. This allows the market entry for investors to better understand local demand, the healthcare regulatory environment, and establish relationships and a market entry strategy with lower overall investment.

The potential success of healthcare investment in Vietnam calls for a pragmatic approach. Local partners, a reasonable and long-term market focus, tend to favor investment in Vietnam’s evolving healthcare sector.

Conclusion

The focus areas for investment in Vietnam’s healthcare industry, based on the long-term structural trends in healthcare (such as an aging population, increased spending, a greater demand for private healthcare, and the digital transformation), include private hospitals, healthcare, and medical services. There are more opportunities in this developing market and in the healthcare and medical services sectors than there are in other sectors of the economy.

Investors also need to deal with compliance, lack of skilled workforce, and operational problems that affect the timelines and execution of projects. The most successful investors usually do and utilize their market assessments and local partnerships effectively and integrate regulatory strategies.

Vietnam is continuously modernizing its healthcare system and is seeking to include more of the private sector, so investors are more likely to find lucrative opportunities in the Vietnamese healthcare market compared to other Southeast Asian countries. If foreign healthcare companies want to grow in other countries after Vietnam, this is the most likely and best option.