Indonesian state-owned pharmaceuticals firm Kimia Farma is considering expanding into Vietnam by acquiring a local company.

The firm recently invested US$10.26 million in a Saudi Arabian firm, purchasing 60 per cent of its shares and renaming it as Kimia Farma Dawaa.

It is currently investigating Vietnamese regulations to discover whether or not it can own a majority stake in a local firm, a critical factor in securing its investment.

“It depends on the regulation in the country,” said Kimia Farma finance director IGN Suharta Wijaya. “If the regulation is okay, we will enter the country this year.”

“If the sales of each Kimia Farma outlet in the country is IDR1.5 billion ($104,877) per month, [the sales of an outlet of the Vietnamese company] could be IDR4 billion per month,” Wijaya added.

Investment in the pharmaceutical industry is stepping up in Vietnam, with the announcement last week that Vietnam-focussed private equity firm Mekong Capital has issued funding to pharmacy chain Pharmacity.

With 186 outlets retailing both traditional Vietnamese and Western medicines, Pharmacity is the country’s most widespread network of pharmaceutical products stores, with 1 million subscribers to its loyalty program. The firm is targeting 1000 outlets in Vietnam within two years.

Reportedly, Kimia Farma is seeking to buy a chain with 400 outlets nationwide.