Acquiring a pharmaceutical company differs fundamentally from an ordinary M&A deal in one respect: most of the deal value lies not in factories or machinery, but in drug marketing authorizations and a valid system of pharmaceutical business licences. If the marketing authorizations of the key products are defective, the deal can lose most of its value the day after signing.
This article sets out a focused legal due diligence framework for buyers acquiring pharmaceutical companies in Vietnam under the current legal framework.
1. The latest framework: Law 44/2024/QH15 amending the Law on Pharmacy
The law amending the Law on Pharmacy is Law 44/2024/QH15 (not 43/2024 as some older materials mistakenly cite), effective from 1 July 2025. Notably, it extends the validity of drug registration certificates from 1 January 2025.
When researching, buyers should refer to Consolidated Document 76/VBHN-VPQH (2026) — the latest consolidated version of the Law on Pharmacy — rather than older texts.
2. Marketing authorizations: share deal vs asset deal decides everything
The key principle: a marketing authorization is tied to the “registration holder” — it is not an asset that can be freely transferred like machinery or inventory. Deal value is directly linked to valid marketing authorizations, and buyers must never treat them as ordinary assets when pricing the deal.
Share deal (acquiring shares or capital contributions, with the target legal entity unchanged): marketing authorizations remain in the company name and do not need to be re-issued. Only update procedures are required when the company changes its name or address.
Asset deal (acquiring assets) or a change of manufacturing site: new marketing authorizations must be obtained, except where only the secondary packaging or batch-release site changes. Changing the registration holder requires confirmation from both the old and the new registration holder under Circular 08/2022/TT-BYT.
Practical consequence for negotiation: in an asset deal, the buyer must factor the timing and risk of re-issuance into conditions precedent and price adjustment mechanisms; in a share deal, due diligence focuses on verifying that each authorization is valid and correctly registered in the entity name.
3. Certificate of eligibility for pharmaceutical business
The framework is Decree 54/2017/ND-CP, as amended by Decree 155/2018/ND-CP and Decree 88/2023/ND-CP.
Buyers must check whether post-deal changes trigger an obligation to amend or re-issue the certificate: a change of the professional responsible person, a change of business location, or a change of the scope of pharmaceutical business may each require amendment or re-issuance.
4. Drug advertising: the red lines after M&A
The Law on Advertising was amended by Law 75/2025/QH15, effective from 1 January 2026. For drug advertising, Circular 09/2015/TT-BYT governs the confirmation of advertising content.
Two red lines buyers must know:
- Prescription drugs: advertising to the public is prohibited.
- Over-the-counter (OTC) drugs: may only be advertised after the advertising content has been confirmed by the competent authority.
During due diligence, buyers must review all current advertising and promotional activities of the target for compliance with these limits, because pharmaceutical advertising violations can trigger sanctions and damage brand reputation — directly affecting deal value.
Note: the specific article numbers on advertising in the Law on Pharmacy should be checked directly against the original text (Consolidated Document 76/VBHN-VPQH of 2026), as secondary sources are not consistent.
5. Pharma M&A with foreign elements: market access conditions
Where the buyer is a foreign investor, the deal must also satisfy market access conditions under Article 8 of the Law on Investment 143/2025/QH15 — pharmaceuticals is a conditional business sector for foreign investors. This check must be done before price negotiation even begins.
6. Legal due diligence checklist for a pharma M&A deal
- Marketing authorization for each key product: still valid, correctly registered in the entity name, and who the registration holder is;
- Certificate of eligibility for pharmaceutical business: whether scope, location and the professional responsible person match post-deal reality;
- GMP and related specialist licences for manufacturing, storage and distribution;
- Advertising files: content confirmations for each OTC product, and a review of prescription-drug advertising violations;
- Outstanding sanctions: unexecuted administrative sanction decisions in the pharmaceutical and advertising sectors.
Frequently asked questions
Q: Does buying shares in a pharma company require re-issuing drug marketing authorizations?
A: No, in a share deal where the legal entity is unchanged — authorizations remain in the company name. Only update them if the company name or address changes.
Q: How are marketing authorizations handled when acquiring a pharma factory (asset deal)?
A: New marketing authorizations are required when the manufacturing site changes (except secondary packaging or batch-release sites), with confirmation from both the old and new registration holder under Circular 08/2022/TT-BYT.
Q: Can prescription drugs be advertised?
A: No — advertising prescription drugs to the public is prohibited. OTC drugs may be advertised once their advertising content is confirmed.
Q: What extra conditions apply to foreign investors buying a pharma company?
A: They must satisfy market access conditions under Article 8 of the Law on Investment 143/2025/QH15, as pharmaceuticals is a conditional sector.
Legal sources
- Law 44/2024/QH15 amending the Law on Pharmacy (effective 1 July 2025); Consolidated Document 76/VBHN-VPQH (2026);
- Circular 08/2022/TT-BYT — drug marketing authorization registration;
- Decree 54/2017/ND-CP (amended by Decrees 155/2018 and 88/2023) — pharmaceutical business conditions;
- Law 75/2025/QH15 amending the Law on Advertising (effective 1 January 2026); Circular 09/2015/TT-BYT — confirmation of drug advertising content;
- Law on Investment 143/2025/QH15, Article 8 — market access conditions.
See also: FLAT Law Firm
Contact us
FLAT Law Firm advises on legal due diligence and deal structuring for pharmaceutical M&A: reviewing marketing authorizations, pharmaceutical business licences, advertising compliance and market access conditions for foreign investors. Contact: contact us.
This article is for general information only and does not constitute legal advice for your specific situation.
Transparency note: This article was prepared by our editorial team with quality assurance (QA) support from the AI Legal Council; it has not been reviewed or approved by a human lawyer.
