Industry speculating on special clause for IMD

High expectation before MOHW’s final announcement

“IMD is only cash cow to focus on R&D, now that saline-based patent evasion is blocked”

While the government’s announcement on the revised drug pricing regulation has been delayed, the pharmaceutical industry is seemingly speculating on a possible new special clause of the regulation to exempt incrementally modified drug (IMD) with recognized non-obviousness.

 

The industry predicts the government is more likely to make an exception for IMD, because Korea Pharmaceutical and Bio-pharma Manufacturers Association (KPBMA) and the pharmaceutical industry have been consistently voicing the necessity of maintaining weighted pricing benefit for IMD and National Assembly Health and Welfare Committee have also expressed concerns about the issue as well.

 

According to sources from pharmaceutical industry and National Assembly on Jan.

 

5, companies dealing with IMDs are keeping their eye close to Ministry of Health and Welfare’s (MOHW) finalized drug pricing system revision.

 

For now, the industry does not have much to complain about the government’s intention to lower generic pricing.

 

As MOHW has shown its firm determination to strictly regulate drug pricing, the industry seems convinced about the need of shifting companies’ business focus.

 

However, the industry is strongly urging the government to establish a special clause on the revised drug pricing regulation to exempt IMDs from the generic pricing reduction.

 

Basically, the industry is expecting the government’s smart regulation to set a different regulation for IMD that protects industry’s willpower to develop pharmaceutical cash cow in the future.

 

The industry’s voice has gotten even louder, because recently a court ruled against a generic challenging an original’s patent by changing its saline base.

 

The Patent Court in last December has decided some of generic-makers’ strategy to change saline base of the original Champix (varenicline) is patent infringement.

 

Prior to the Patent Court’s decision, the Supreme Court also did not concede with generics claiming to have evaded infringement of term-extended patent by changing the saline base of the original overactive bladder treatment Vesicare (solifenacin).

 

Technically, it was the end of the saline-based patent evasion strategy.

 

As a result, generic makers have lost its one of major income sources as they used to launch their generics after challenging and shortening an original’s patent term.

 

Now that the saline-based patent evasion is not an option anymore, generic makers argue at least pricing benefit for IMDs with proven non-obviousness should be kept.

 

A Korean pharmaceutical company insider commented, “We are quite curious about the finalized drug pricing regulation of MOHW, because IMD is the only technical strategy and cash cow business model in Korean pharmaceutical market saturated with excessive amount of generics.

 

The government should set forth a special clause providing pricing benefit for IMDs, at least, regardless of tightened pricing regulation on simple generic or general combination drug.” Another company’s insider claimed, “Up to date, saline-based patent evasion strategy has been a legitimate and prominent means to push up generic launch date and generate profit.

 

Without the strategy, pharmaceutical companies would struggle to develop any drug and generate profit from it.

 

Only when the government recognizes pricing benefit for IMDs, more companies would endeavor to develop IMDs with non-obviousness.”