Need for 'opening' for M&A in the healthcare sector

The healthcare system is entering a period of extensive restructuring, and M&A (mergers and acquisitions) activities in the healthcare industry are gradually becoming more active. From the pressure to upgrade facilities, digital transformation to the opportunity to expand the chain and optimize operations, the market is forming many "bright spots" to attract domestic and foreign investors. There are many opportunities but also many challenges in this field.

Potential market

Sharing at the International Conference on Mergers and Acquisitions (M&A) in the Vietnamese Healthcare Industry 2025 - HIMA 2025, held on the morning of November 21 in Hanoi, Mr. Nguyen Toan Thang - Deputy Chief of Office of the Ministry of Health emphasized that Vietnam is facing a particularly important moment, a new opportunity for integration and development in the healthcare sector.

Accordingly, the demand for medical examination and treatment is increasing rapidly: The goal of the health sector by 2030 is to expand the scope of health care programs and activities to the community, especially developing medical examination and treatment services; Ensure health security, respond promptly to climate change and medical emergencies; Gradually control disease risk factors, improve health environment management capacity...

Hospital - pharmaceutical - medical equipment models are constantly expanding with: Diversifying hospital models to improve health care efficiency; Improving the capacity and effectiveness of State management in the fields of pharmaceuticals, food, and medical equipment; Publicity, transparency, reform of administrative procedures in management, licensing, and procurement of drugs and medical equipment; Improving production capacity, purchasing and selling medical equipment domestically and internationally... International investment capital for this field is increasingly interested in Vietnam.

“In that context, M&A has become one of the strategic tools to help the healthcare ecosystem develop faster, more sustainably and reach international standards. However, this is also a field that requires transparency, professionalism and legal risk management. And only when legal processes, auditing, valuation and operating standards are standardized, will businesses be ready to enter the investment - cooperation - IPO playground” - Deputy Chief of Office of the Ministry of Health affirmed.

Associate Professor, Dr. Dang Duc Nhu - Chairman of the Board of Directors of Vietnam Medical Legal Consulting Company Limited (MEDICAL Law) said that the total M&A value in the first 8 months of 2025 in Vietnam reached about 4.8 billion USD (up 21% over the same period in 2024); The average deal size was 42 million USD (15% higher than the period 2022 - 2023). Data shows that M&A activities continue to grow strongly, with increasingly large deal sizes, especially in areas such as healthcare, education , retail and technology...

Vietnam's healthcare market is growing strongly, from 18.5 billion USD in 2022 to an expected increase of 25 billion USD by 2025. In particular, the pharmaceutical market has great potential and development, with an average annual growth rate (CAGR) of up to 11.1%. The same is true in the field of medical examination and treatment. Currently, the country has 408 private hospitals/1,672 hospitals. MEDICAL has successfully consulted and found investors for 4 hospitals and is consulting for 12 hospitals. Many hospitals and private medical facilities are in need of finding investors and calling for more capital...

Promoting a transparent investment environment

Notable hospital M&A deals include CVC Capital Partners (European PE Fund) acquiring Phuong Chau International Hospital (Can Tho) - a deal revealed to be worth about 116 million USD; Dongwha Pharm (Korea) spending about 30 million USD to acquire 51% of shares in Trung Son Pharma Pharmacy chain - a large pharmacy system in the Mekong Delta; Livzon Group (China) announced plans to spend more than 5,730 billion VND (nearly 240 million USD) to acquire nearly 65% ​​of shares in Imexpharm Pharmaceutical Company (IMP) - one of the largest listed pharmaceutical companies in Vietnam...

With open, transparent policies that encourage investment, M&A in the healthcare sector has many opportunities for development. However, according to the Chairman of the Board of Directors of Vietnam Medical Legal Consulting Company Limited, this activity is also facing many challenges in the legal framework. Specifically, the legal corridor for M&A is not yet complete, administrative procedures are still complicated; Regulations on corporate governance and asset valuation in the healthcare sector are not yet synchronized, causing many difficulties for M&A deals. "M&A appraisal in the healthcare sector is much more complicated than in other specialties, related to practice licenses, professional operation licenses, fire prevention and fighting, environment, senior personnel, good doctors, drug lists, equipment and regulations on health insurance" - Associate Professor, Dr. Dang Duc Nhu commented.

From the reality of consulting and customer support activities, Associate Professor, Dr. Dang Duc Nhu reflected that many M&A deals require financial proof, while international standards do not require it. There are units that have completed the purchase and sale, changed their names but have not yet transferred the Technical Catalog, leading to legal problems related to payment issues, health insurance, etc. Not only that, this is a highly confidential field, but during the purchase and sale process, businesses have information leaks, greatly affecting their reputation and the quality of medical examination and treatment, etc.

According to Associate Professor, Dr. Dang Duc Nhu: "M&A in the healthcare sector is very complicated because it involves human resources and medical data, because this is a conditional business that requires high confidentiality. Therefore, the success of the deals depends greatly on legal advice." Specifically, there are 4 basic steps that units must carefully prepare and pay attention to: 1. Consulting (Consulting on transaction structures in accordance with specialized laws); 2. Conducting legal review (An indispensable step to evaluate the target enterprise as a whole); 3. Signing legal documents (Parties sign a number of legal documents such as: Share purchase and sale contracts, etc.); 4. Carrying out license adjustment procedures and notifying the management agency (carrying out legal procedures).

Source: https://baophapluat.vn/can-loi-mo-cho-ma-trong-linh-vuc-y-te.html