The Market Surveillance Agency recently seized 200,000 masks that were being transported to China in the border province of Quang Ninh. The agency said the masks are in high demand in China because of the deadly new coronavirus (nCoV).
The agency plans to distribute the confiscated masks since they are also in high demand in Vietnam.
The seizure came amid complaints in many localities about mask shortages.
Hanoi, the northern provinces of Lang Son and Hoa Binh, Ho Chi Minh City and several southern localities have reported shortages.
Since last Friday the agency discovered and fined 1,221 pharmacies raising the prices of masks and other items such as hand wash gel and gloves.
It said by Sunday there were no longer the queues to buy masks that were seen on Friday, but many drugstores only allowed customers to buy one or two boxes due to limited stocks.
Some pharmacies in Da Nang City and Quang Ngai Province in the central region sell a box of 50 masks at VND70,000 ($3), doubled the regular price.
Authorities are cracking down on retailers taking advantage of the emergency situation and selling masks at high prices.
Deputy Prime Minister Vuong Dinh Hue has ordered relevant authorities to punish sellers who raise the prices of medical equipment.
The Ministry of Health has said the 30 mask manufacturers in the country will produce enough masks to meet demand.
Vietnam had eight confirmed cases of nCoV infection as of Monday morning, including three foreigners.
There are 92 suspected cases with symptoms like high fever and cough, including some who visited infected areas in China.
The epidemic has killed 362 people globally, one in the Philippines and the rest in China.