Health vice-minister answers questions on MOHW drug pricing

An interview with the first ever second vice-minister of MOHW, Kang Do-tae determined to communicate with pharmaceutical industry

Indication-based drug pricing conflicted between treatment access and NHI finance

Regardless of the court’s decision on reimbursement reduction on choline alfoscerate, listed drug reevaluation to continue

Kang Do-tae (Master’s degree in Public Administration at Seoul National University) has been appointed as a first second vice-minister of Ministry of Health and Welfare (MOHW) to lead the health sector of the ministry amid COVID-19.

 

And during an interview on him, the vice-minister expressed his commitment to not only focus on the infectious disease control but also to pay attention to healthcare development planning the administration is firmly pressing on.

 

A month into his new appointment, the second vice-minister is in charge of the entire health sector including the healthcare and pharmaceutical industry.

 

During an interview with the industry news media, Vice-minister Kang affirmed his approach on the health policies and determination to communicate with the industry as much as possible.

 

He also said more comprehensive and systematic healthcare developing roadmap would be taken by sufficiently surveying opinions from various stakeholders.

 

However, he was particularly careful on speaking about sensitive issues like choline alfoscerate substitution prescription and non-proprietary name prescription, coverage on Korean herbal medicine, and alternative exam date for medical school students who were on strike.

 

Following is the detailed interview with the vice-minister.

 

▶The Korean pharmaceutical industry is complaining about the skewed regulatory policy, namely the generic pricing system revision.

 

While the administration is pressing on the coverage enhancement, the public is criticizing on the insufficient fostering initiative for the Korean pharmaceutical industry and unilateral policy execution.

 

Regarding the criticisms, what is your opinion on them and how do you plan to approach the said policies? “Since the valsartan contamination incident in 2018, the notion of generally amending the generic management system has been suggested.

 

MOHW then discussed with the Ministry of Food and Drug Safety (MFDS) and collected the pharmaceutical industry’s opinions to revise the drug pricing system to ultimately improve the generic quality management and competitiveness.

 

We would push on with the pricing policies announced already, but also sufficiently communicate with the industry when setting up detailed action plans.

 

While streamlining the pricing system, we would constantly seek for policies to foster and support the pharmaceutical industry—the key emerging industry of the country.

 

The ministry has drawn up and started executing the biohealth industry innovation strategy plan and the Second Five-year Comprehensive Plan (2018-2022) for Pharmaceutical Industry Fostering and Supporting, which includes R&D investment expansion, major specialist training, and biohealth technology innovation ecosystem establishment.

 

The ministry would continue to provide supports for the industry for its further innovation and better global competitiveness.” ▶Pharmaceutical companies are urging the government to differentiate pricing as a new drug, when an anticancer therapy adds a new indication.

 

The industry apparently wants to communicate with the government on its stance, but they say the government has not been responding.

 

What is your opinion on the matter?

 

“A new drug pricing system that gives different pricings on a drug based on indication could help improving the access to needed treatments.

 

But we need to first evaluate if such system can be realized within the current National Health Insurance (NHI) and its billing and payment system.

 

Also, the indication-based differentiated pricing should be decided after surveying a wide array of stakeholders including the relevant government bodies, industries and civic groups.

 

Regarding the communication with the pharmaceutical industry, the ministry would regularly convene a meeting with the related industry organizations for their in-depth opinions.” ▶Recently, the court has ruled to halt the reimbursement reduction order on choline alfoscerates.

 

With the decision, would you say the reevaluation on other drugs are also on hold or halted as well, or that the ministry is planning to continue on with the reevaluation program according to the newly written reevaluation clause within the revised reimbursement regulation?

 

“So far, the National Assembly, the media and civic groups have pointed out how reevaluation is needed for those drugs with questionable clinical efficacy.

 

As a first case, we have selected and reevaluated drugs with choline alfoscerate, and newly added a legal basis within the National Health Insurance reimbursement standard to adjust reimbursement on already-listed drugs through reevaluation.

 

Other drugs would be reevaluated next year, and we would fully communicate with the pharmaceutical industry, experts and civic groups during the process.” ▶While the trend of pharmaceutical companies signing deals with CSOs is becoming more apparent, is there any CSO management plan including the expenditure report management the MOHW is preparing?

 

“There have been concerns of the industry finding new means to provide rebate as more companies are working with CSO.

 

Accordingly, the ministry is to also seek measures, based on the Pharmaceutical Affairs Act, to prevent CSOs providing rebate by penalizing them with business suspension.

 

Also the CSO would be responsible to document financial benefit provided to healthcare providers and to file expenditure report under the supervision of the consigner.

 

By raising awareness of the expenditure report system that requires healthcare providers and pharmaceutical industry to verify the report, the ministry would encourage the CSOs to be better self-managed.” ▶Until now, the government has acknowledged the necessity of generic substitution and non-proprietary prescription, but turned them down due to conflict between the healthcare providers and pharmacists.

 

What is your opinion on the issue?

 

“There are so many different opinions suggested by the medical and pharmaceutical experts from health industries to academic societies regarding the government promoting non-proprietary prescription and generic substitution.

 

So we would need to first create a social consensus to reflect not only the medical and pharmaceutical industries, but also the public.”