Gov't to unveil New drugs·Generic Drug Pricing System Rev.

in November

Anticipated to enhance new drug accessibility and fix integration of drug price reduction·conventional drug pricing system

Establishment of preferential drug pricing regulations, covering items that support the stable supply of essential drugs, is expected

Director General Lee Jung-kyu

The Ministry of Health and Welfare (MOHW) has announced plans to release the drug pricing system revision next month (November), including both new drugs and generics.

 

It is drawing the attention of Korean and international pharmaceutical companies.

 

The MOHW plans to disclose the timing of the re-evaluation of reimbursement appropriateness for listed drugs, along with the new drug pricing improvement plan.

 

The reform is expected to include significant measures that will impact the Korean pharmaceutical industry, including enhancing patient access to new drugs, strengthening the stability of essential medicine supply, standardizing the post-market drug price reduction system, and improving the conventional generic drug pricing structure.

 

On October 12, Lee Jung-kyu, Director General of Health Policy of the MOHW, shared some of the direction for the new drug pricing improvement plan, including reimbursement re-evaluation, during a meeting with the Korea Special Press Association.

 

Lee stated that the re-evaluation of reimbursement appropriateness is currently under review as part of the overall drug pricing system revision plan.

 

Lee explained that the delay is due to efforts to align the re-evaluation's direction with the new improvement plan, following earlier subcommittee discussions.

 

The 'actual transaction price-based drug price reduction system' will proceed as scheduled, as its implementation timeline was recently announced.

 

However, the MOHW plans to discuss it with revisions under review, including post-market drug price management.

 

Furthermore, the MOHW's drug pricing revision plan for next month is expected to include items discussed at the World Bio Innovation Forum, which President Lee Jae Myung attended on the 5th of last month.

 

At the forum, a plan to expand the application of a dual pricing system was stated.

 

The dual pricing system is one in which the actual price of a medicine differs from its officially listed price.

 

The goal is to provide Korean pharmaceuticals with a competitive advantage when exported overseas, thereby facilitating drug price negotiations.

 

The MOHW has already implemented a form of dual pricing through a drug pricing system revision in March.

 

This revision allows the National Health Insurance Service (NHIS) to enter into a separate contract with a manufacturer, contract manufacturer/seller, or importer if the drug is deemed necessary after assessing its impact on public health and if the company wishes to pursue strengthening global competitiveness.

 

The MOHW is now considering expanding the application of this provision to other medicines.

 

The system for concurrently processing approval, evaluation, and negotiation (Concurrent Approval-Evaluation-Negotiation) is currently in a pilot phase and is expected to transition to a formal system.

 

The integration of post-market drug price management, such as price reductions, is being discussed to align the currently separate price adjustment systems (the drug price cap adjustment system) so they are implemented on a single date and time.

 

This would unify the timing and application of systems like the NHIS's price-volume agreement (PVA)-linked reduction and HIRA's reimbursement re-evaluation and actual transaction price reductions.

 

While the MOHW emphasizes that post-market management and re-evaluation have distinct goals and objectives for each system, it has commissioned policy research in response to demands from pharmaceutical companies and local pharmacies to enhance the predictability of drug price reductions.

 

The MOHW also conducted policy research on the integration of drug price cap adjustment mechanisms in March of this year, to finalize specific plans and financial impact analyses based on the results of the preceding research.

 

Regarding preferential drug price regulations, new provisions are expected to be established, such as preferential pricing for drugs that contribute to the supply of essential medicines, executing the government's national goal of stable supply for drugs with unstable supply.

 

Lee said, "Last year's research service analyzed the current situation," and added, "Based on that data, it has been analyzed that further research is needed on how to improve the system, and that additional research will be commissioned soon."