Lee Jae-Myung elected as president of South Korea

Reforms anticipated in medical-political conflicts, telemedicine, and the drug price system

Whether INN-based prescriptions will become a reality gains attention... Institutionalization of public electronic prescription system

Establishment of a National Medical Reform Public Opinion Committee gains momentum... 2027 medical school enrollment, to be decided by Committee on Medical Manpower Planning

New drug R&D linked to drug price incentives... Generic drugs with insufficient effectiveness to be removed from national health insurance reimbursement list

Lee Jae-myung, the 21st President of South Korea

With the election of Lee Jae-myung of the Democratic Party (Candidate No.

 

1) as the 21st President of South Korea, momentum is expected to build for key healthcare policies.

 

These include the establishment of a National Medical Reform Public Opinion Committee to resolve conflicts between the medical community and the government, the promotion of limited International Nonproprietary Names-based prescriptions and generic substitutions to address drug supply instability, and the institutionalization of telemedicine with a standardized public e-prescription system.

 

In particular, President Lee Jae-Myung has pledged to establish a system for telemedicine that complements in-hospital care, adheres to the principle of follow-up visits, and centers on neighborhood clinics, while halting indiscriminate pilot projects and establishing a management and supervision framework for intermediary platforms, is expected that the current unlimited telemedicine pilot project will be reasonably scaled back.

 

From the pharmaceutical and biotech industry’s perspective, insiders are expecting a comprehensive overhaul of the drug pricing system, including granting higher drug prices to pharmaceutical companies that have invested heavily in R&D for innovative new drugs and strengthening mechanisms to remove generic drugs from the market if they fail to properly prove their efficacy.

 

President Lee Jae-myung is expected to immediately begin implementing his campaign pledges on healthcare, pharmaceuticals and biotechnology, and health insurance without forming a transition committee.

 

National Medical Reform Public Opinion Committee, Resolution of the medical-political conflict remains a challenge President Lee Jae-myung has decided to immediately begin work on establishing a National Medical Reform Public Opinion Committee that will involve the public, healthcare professionals, and experts from various fields.

 

This is to resolve the ongoing issues triggered by the Yoon Suk-Yeol administration's policy to increase the number of medical school enrollment quotas by 2,000, which led to collective action by resident doctors and medical students in February last year and a medical staffing shortage.

 

However, the Democratic Party has stated that it will not provide additional benefits to the resident doctors who participated in the collective action to resolve the conflict between the government and the medical community.

 

Ultimately, it is likely that the committee will discuss solutions to the collective action by doctors and medical students.

 

In addition, the policy to increase the number of medical school enrollment quotas is likely to be decided based on the results of the review by the Committee on Medical Manpower Planning, which was passed by the National Assembly with the agreement of both the ruling and opposition parties.

 

This is because the Democratic Party of Korea's policy was to decide on the number of medical school enrollment quotas for the 2027 academic year and beyond through an objective and transparent deliberation process by the the Committee on Medical Manpower Planning, as the number of medical school enrollment quotas for the 2026 academic year has been set to return to 3,058.

 

Furthermore, it is expected that Cho Kyoo-Hong, Minister of Health and Welfare, and Park Min-Soo, Second Vice Minister, who were at the forefront of the policy to increase the medical school enrollment quota, will be held accountable.

 

As part of measures to strengthen regional and essential medical care, the government has promised to introduce a regional doctor system, establish public medical schools, and promote public medical academies.

 

The government also plans to assign national university hospitals the role of base hospitals and expand public medical infrastructure by medical service area.

 

Solutions to the drug shortage crisis, stronger government intervention, and INN-based prescriptions The solution to the supply instability of medicines pledged by the president involves strengthening government intervention in all stages of the process, from the supply of APIs for medicines that are frequently out of stock to the production of finished medicines and distribution to pharmacies.

 

The government is expected to establish a list of frequently out-of-stock medicines and provide incentives for pharmaceutical companies to take an interest in producing APIs that are difficult to produce in Korea.

 

The Democratic Party of Korea's policy is to increase profits for pharmaceutical companies that produce finished drugs using domestically produced raw materials show improved self-sufficiency rates and strengthen the public drug consignment manufacturing system for drugs in short supply.

 

At the same time, the government will allow limited use of generic drug prescriptions for essential medicines with unstable supply.

 

The government plans to resolve issues that caused significant inconvenience to the public during the COVID-19 pandemic, such as the shortage of acetaminophen for prescription drugs, by allowing limited INN-based prescriptions.

 

President Lee also promised to promote substitute prescriptions as a solution to drug shortages.

 

In response, there is a possibility that the current administration will go beyond allowing pharmacies to notify the Health Insurance Review and Assessment Service after dispensing substitute drugs, which is currently pending implementation, and introduce additional policies to increase the rate of substitute prescriptions.

 

Legalization of telemedicine centered on local clinics and repeat patients gains momentum The possibility of legalizing telemedicine pilot projects within this year has also increased.

 

President Lee promised to institutionalize telemedicine while ensuring safety and effectiveness.

 

It is particularly noteworthy that the Democratic Party of Korea is preparing legislation to institutionalize telemedicine centered on “clinic-level” medical institutions and “repeat” patients.

 

This is because the Democratic Party of Korea, which holds a majority of seats, has succeeded in changing the administration, greatly increasing the likelihood of the Democratic Party-led legislation of telemedicine.

 

The Democratic Party of Korea is preparing a bill that would allow telemedicine to be used primarily by medical institutions at the clinic level, but also allow hospitals to provide telemedicine in special cases.

 

In particular, the bill is expected to include provisions allowing telemedicine for initial consultations only for patients under 18 years of age and those over 65 years of age, while patients in other age groups would only be able to apply for telemedicine for follow-up consultations.

 

In this case, the scope of eligible recipients for telemedicine would be significantly reduced compared to the current pilot program.

 

Of course, since the amendment to the Medical Service Act to legalize telemedicine must undergo parliamentary review, the Democratic Party of Korea cannot make a unilateral decision on the matter.

 

Unlike the 21st National Assembly, the 22nd National Assembly will see the ruling party change from the People Power Party to the Democratic Party of Korea, and it is expected that the Democratic Party's proposal will be reflected in the government's proposal to a considerable extent.

 

The establishment of a public electronic prescription system will also be implemented along with the institutionalization of telemedicine.

 

The Democratic Party of Korea plans to utilize public electronic prescriptions as a means to prevent the falsification and misuse of prescriptions and to prevent errors in the entry of prescription information during telemedicine.

 

Pharmaceutical industry announces restructuring and advancement of drug pricing system President Lee announced a policy pledge to actively promote the pharmaceutical and bio industry as a new future growth engine for South Korea.

 

As a measure to promote the pharmaceutical and bio industry, President Lee announced plans to revise the drug price system to focus on new drugs and strengthen the mechanism for removing generic drugs that have not been verified their effect from Korea’s health insurance reimbursement list.

 

The most notable pledge is “drug price incentive linked to new drug R&D investment rates.” The vision is to create an environment where pharmaceutical and biotechnology companies can focus on developing new drugs by setting higher drug prices for medications produced by pharmaceutical companies that contribute significantly to innovative new drug R&D.

 

This pledge was one of the policies proposed by multiple domestic pharmaceutical and biotech companies led by the Korea Pharmaceutical and Bio-Pharma Manufacturers Association.

 

The government also promised to establish a more predictable drug pricing system to serve as a catalyst for new drug development and a cash cow for domestic pharmaceutical companies.

 

The vision is to integrate drug price reduction mechanisms to establish a drug pricing system that encourages investment in new drug R&D.

 

The president has also outlined a plan for the government to take the lead in establishing an R&D investment system and forming large-scale funds (megafunds) to promote industry development.

 

In addition, the candidate's campaign promises include advancing the certification system for Korea Innovative Pharmaceutical Companies to expand R&D tax credits for certified innovative pharmaceutical companies, establishing a governance system that combines AI and big data technologies for the development of new drugs targeting global markets, and expanding risk-sharing agreements (RSA).

 

To secure health insurance funds for these initiatives, the candidate proposed removing non-verified generic drugs from the market.

 

In other words, the intention is to create some health insurance funds by more actively reevaluating the reimbursement of generics that have been approved for a long time but are not effective, thereby narrowing the scope of health insurance coverage.  On the morning of the 4th, when his election was certain, the president-elect took the stage in front of the National Assembly and said, “The responsibility of a president in a united country is to bring the people together.

 

I will never forget that my duty is not to be a great ruler, but to greatly unite the people.” Meanwhile, President Lee began his term as president immediately after the National Election Commission officially confirmed his election as president at 7 a.m.

 

on the same day.

 

President Lee held a brief inauguration ceremony at the National Assembly at 11 a.m.

 

that day, after which he immediately appointed the Chief of Staff and began forming his Cabinet, including the Prime Minister.