Traphaco: Success Comes from Proper Investment Policies

Traphaco: Success Comes from Proper Investment Policies

Traphaco, a familiar and prestigious trademark in pharmaceuticals, has experienced 32 years of development. From 1972 to 2004, the company recorded great achievements in production and business activities. In recognition of its contribution and achievements, the company has been presented with the Labour Order and the Sao Vang Dat Viet (Vietnam Land Golden Star) award. All the cadres and workers of the company have made great efforts to become a familiar name in most Vietnamese families.

Overcoming difficulties

The former organisation of the Traphaco Joint stock Company was a medicine production group under the railway service. It initially had only 15 cadres and workers specialising in preparing medicines according to orders. After 21 years of operation under market mechanisms, the Railway Medicine Production Factory was set up on June 1, 1993 to produce and supply medicines with a total investment capital of less than VND300 million (US$19,108) with poor and outdated equipment and facilities. In 1994, the factory was renamed the Transport Pharmaceutical and Medical Material and Equipment Company with functions in trading medicines, medical equipment and materials. A direct involvement in distributing helped the company understand the market demand. In 1999, the company was equitised and renamed the Transport Pharmaceutical and Medical Material and Equipment Joint stock Company, implementing a renewal policy for increasing the effectiveness of its business and production activities. This was an important turning point, bringing the company into the market economy with its benefits shared between the company and shareholders. In 2001 the company was renamed the Traphaco Joint stock Company that operated in major production fields, including medicines, medicinal materials, chemicals, medical equipment, food, alcohol, beer, soft drinks, cosmetics, consulting, scientific and technological services, technological transfers in the medical and pharmaceutical fields, and import and export activities.

At the time, the market was flooded with various imported medicines and materials. The Traphaco trademark had still not become a familiar name in Vietnamese households as many of them still remembered the pharmaceutical factory of the railway service with its ‘bright eye’ tablets. Despite many difficulties, the company invested in marketing activities to expand its market while focusing on research and development activities to manufacture products under the Traphaco trademark. To date, the company has produced more than 140 products which have been recognised by the Ministry of Public Health. This means that each year the company succeeds in producing 18 new products on average. Many products of the Traphaco are now ‘Vietnamese trusted’ brands. These include blood activating and brain strengthening tablets, Trapha, T-B, Ampelop and Cadef. Traphaco can now produce tablets, capsules, softgels, sugar coated capsules, film-coated tablets and cabee granulated medicines. Many traditional medicines have been produced using modern technology. These include Boganic sugar coasted capsules, salviae and notoginseng. Vu Thi Thuan, director of the Traphaco Joint stock Company, said that each year the company invested five per cent of its revenues in researching and developing new products and VND2 billion (US$127,388) in welfare for its cadres and workers, constituting significant amounts of capital.

The great efforts of the company have indeed paid off. Alongside a growth in production and the development in both quantity and quality of its products, the company’s incomes have increased by 48 per cent and its contribution to the State budget has seen a rise of 60 per cent a year. Currently, the average income of cadres and workers of the company is VND2.5 million (US$159) per month.

Combining the traditional and the ultra-modern

Thuan said that Traphaco had become a familiar trademark for consumers thanks to its personal input. As most Vietnamese prefer the use of traditional medicines, one of the development strategies of Traphaco is to apply modern technology to develop medicinal material supplies. As well as piloting and evaluating products that combine the old and the new, Traphaco has joined many research works at national and ministerial levels. These include a programme on preserving and developing Vietnamese medicines, developing safe medicinal material supply areas and developing and processing safe materials for producing high quality medicines.

The company has also focused on manufacturing products from traditional medicines, which account for 79 per cent of the company’s medical materials. Traphaco is a leading company in researching traditional remedies, such as artichoke, angelica and ashweed.

With the motto ‘taking science and technology as a focus, market as the orientation, growth as the driving force and quality for commitment with customers,’ Traphaco is building a solid foundation for ‘Made in Vietnam’ medicinal products.

• Thu Huyen