Periodic drug price system reform included as national task

… will the price of generic drugs be reduced, again?

Telemedicine and a public e-prescription system also included

MOHW launches study on Korea’s generic drug price system following last year… even after the change in administration

President Lee Jae-myung attended the National Planning Committee

The government has selected a policy to improve the drug price calculation system and establish a periodic drug price adjustment mechanism as part of its national policy task, with the goal of ensuring the sustainability of health insurance, and is pushing ahead with its implementation.

 

Depending on the specific details of the national policy task to be established in the future, it is noteworthy that this could lead to additional post-marketing management regulations, such as a price reduction mechanism for generic drugs with expired patents, which is a highly concentrated area in the domestic pharmaceutical industry.

 

To build a primary care-based health and care system, the government plans to gradually expand the local primary care physician model starting next year (2026) and adopt the institutionalization of telemedicine and public electronic prescription transmission systems as national policy tasks through social consensus.

 

According to the National Assembly and the medical community on the 13th, the National Planning Committee has adopted such policy directions as national policy tasks.

 

Transition to a sustainable healthcare system The National Planning Committee proposed improving the drug price calculation system and establishing a periodic drug price adjustment mechanism as a means of stabilizing the sustainability of the national health insurance budget, in order to curb expenditure factors that worsen the healthcare system, such as budget leakage.

 

The government has been managing national health insurance drug expenses by adjusting the insurance ceiling price (drug price) of new and generic drugs through the post-marketing drug management system.

 

In particular, following research conducted last year by Professor Dong-sook Kim’s research team at Kongju National University under the Yoon administration, the Ministry of Health and Welfare recently commissioned and launched additional research on the generic drug price system following the election of President Jae-myung Lee and the appointment of MOHW Minister Eun-kyung Jeong.

 

The ministry has entered into a direct contract with a research team led by Professor Seon-mi Jang of the College of Pharmacy at Gachon University to conduct a study titled “Reform of the Drug Price Model (Focusing on Generic Drugs).” The results of this study is expected to serve as a basis for the government's drug price reductions.

 

The Ministry of Health and Welfare under the Lee administration also agrees that it is necessary to establish financial leeway for national health insurance by adjusting the prices of old drugs with uncertain efficacy, so there is great social interest in whether new drug price reduction mechanisms, such as the overseas reference pricing reevaluation measures will emerge.

 

However, there are also opinions that it is difficult to judge whether generic drug prices in South Korea are high or low compared to other developed countries.

 

The Korean pharmaceutical industry is dissatisfied that the government is focused solely on establishing policies to reduce drug prices and is relatively neglecting policies that award premiums on drug prices.

 

Ultimately, the pharmaceutical industry is expected to respond depending on how the details and direction of the national policy agenda are decided.

 

Expansion of telemedicine and establishment of a public electronic prescription system The National Planning Committee has also selected the promotion of public health through primary care-based health management as a national policy task.

 

The goal is to extend the healthy life expectancy of citizens by improving the management rate of chronic diseases through measures such as the expansion of local primary care physicians, the expansion of telemedicine, and the establishment of a public electronic prescription transmission system.

 

The community-based local primary care physician model is planned to be expanded in phases starting in 2026, with the core elements being the provision of comprehensive health management based on multidisciplinary teams and innovative compensation based on performance.

 

The Democratic Party of Korea has submitted a bill to the National Assembly to strengthen primary care and institutionalize the primary care physician system, titled the “Special Act on Strengthening Primary Care” (“Primary Care Special Act”, proposed by Representative In-soon Nam), ahead of the implementation of the Integrated Care Act.

 

The Integrated Care Act and the Primary Care Special Act are expected to serve as the legal and administrative basis for building a society that provides national health care based on primary care.

 

In particular, the National Planning Committee will institutionalize telemedicine based on social consensus and establish a system of telemedicine and remote consultation at public health centers targeting medically underserved areas in rural and fishing villages.

 

Four bills to formally institutionalize telemedicine pilot projects (by Reps.

 

Bo-yoon Choi, Jae-joon Woo, Jin-sook Jeon, and Chil-seung Kwon) are pending in the National Assembly, and the Health and Welfare Committee is expected to review them in the near future.

 

The first subcommittee review is expected to take place as early as the 19th.

 

The National Planning Committee is also expected to include a plan to establish and operate a public electronic prescription transmission system in its national policy task from 2027, based on opinions gathered from the medical community and the Pharmaceutical Association, in line with the institutionalization of telemedicine.

 

The institutionalization of telemedicine and the introduction of public electronic prescriptions were also part of President Jae-myung Lee 's presidential campaign promise.

 

Meanwhile, the National Planning Committee's national policy task must undergo final review by the relevant government ministries and the State Council before it can be finalized.