Preferential pricing possible for non-innovative new drugs

Will Jeil’s new drugs receive the benefits?

According to the 2nd NHI plan, pharmaceuticals that are not innovative new drugs may receive preferential drug pricing

New drugs of Jeil and Dong-A ST are expected to receive preferential benefits…A public-private consultative body will establish the criteria

The government has announced a plan allowing new drugs developed by pharmaceutical companies not designated as Korea’s innovative pharmaceutical companies to be eligible for preferential drug pricing.

 

This has turned attention to whether Jeil Pharmaceutical’s new drugs will benefit from this plan.

 

On the 4th, the Ministry of Health and Welfare (MOHW) announced the 2nd comprehensive National Health Insurance plan (2024~2028), stating that the ministry will establish a measure to provide preferential drug pricing to pharmaceutical companies, regardless of their innovative new drugs designation status, that advance healthcare and establish a stable supply chain.

 

The current plan offers expanded support compared to the ‘the drug pricing system to ensure fair-value compensation for innovative new drugs’ announced by the Biohealth Innovation Committee, which is chaired by the Prime Minister.

 

In ‘the drug pricing system to ensure fair-value compensation for innovative new drugs’, domestically developed new drugs, which were produced by innovative pharmaceutical companies and underwent confirmatory clinical trials targeting Koreans and received expedited approval by the Ministry of Food and Drug Safety (MFDS), were eligible for receiving the drug pricing measures.

 

Previously, if a drug's clinical usefulness was assessed to be the same or less than that of its substitute, it was priced lower than the weighted average price of the substitute.

 

However, from now on, it will be allowed to be priced between the weighted average price and the maximum price of the substitute.

 

Following the announcement, the pharmaceutical industry welcomed the news, but expressed disappointment at the limited benefits for only innovative pharmaceutical companies.

 

During last month’s public-private consultative body meeting, the pharmaceutical industry proposed that non-innovative pharmaceutical companies should also be considered for preferential drug pricing.

 

It seems that such measures have been incorporated into the 2nd NHI plan.

 

Particularly this year, there is anticipation surrounding the emergence of domestically produced new drugs developed by non-innovative pharmaceutical companies, raising interest in whether they will also receive drug pricing benefits.

 

‘Zastaprazan,’ developed by Onconic Therapeutics, a subsidiary of Jeil Pharmaceutical, is one of those drugs.

 

Zastaprazan has applied for product approval form the MFDS.

 

Zastaprazan, like Kcab, is a P-CAB class treatment for gastroesophageal reflux disease.

 

Compared to PPI-class medications, it has a rapid onset of action and can be taken regardless of meals.

 

Onconic Therapeutics conducted a Phase 3 trial enrolling 289 patients with gastroesophageal reflux disease at 28 medical institutions, demonstrating non-inferiority compared to Esomeprazole.

 

The product approval is expected to be confirmed this year, followed by the reimbursement listing process.

 

Based on current criteria, since it is considered a non-innovative new drug, it is expected to receive a price below the average weighted price of substitute drugs.

 

Although the government announced ‘the drug pricing system to ensure fair-value compensation for innovative new drugs’ measure end of last year, Jeil Pharmaceutical and Onconic Therapeutics have been excluded from potential beneficiary because they are not designated as innovative pharmaceutical companies.

 

With the 2nd NHI plan, these new drugs can receive higher prices if subjected to preferential drug pricing.

 

DA-8010, which is a new drug being developed by Dong-A ST for treating overactive bladder (OAB), has been identified as a potential beneficiary.

 

If the phase 3 trials of this drug are completed within the first half of this year, there is a high possibility that the company will apply for product approval by the end of the year.

 

Previously, Dong-A ST has been excluded from drug pricing incentives as it is not designated as an innovative pharmaceutical company, despite the new drug development.

 

The industry expects the government to formulate preferential drug pricing criteria for non-innovative new drugs in the first half of the year.

 

During a meeting with the KSPA NEWS On the 5th, Chang-Hyun Oh, Director of Pharmaceutical Benefits, stated that “We will consider creating an administrative system that provides drug pricing benefits to companies that do not qualify as innovative pharmaceutical companies but have made significant contributions to the healthcare industry and health insurance finances through their R&D investments.” Oh explained, “We will put our efforts into formulating the criteria of preferential drug pricing by the first half of this year.” After the New Year holiday, the government is expected to begin discussing measures of preferential drug pricing with the pharmaceutical industry through a public-private consultative body.