"Regulatory hurdle eliminated to simply refund-type RSA"

also, to raise prices for drugs in shortage

Success in securing production cost for plasma fractionation products·high-risk advanced regenerative medicine

Gov't convened the 6th Bio-Health Innovation Commission and discussed·evaluated achievements

The government saw eliminating regulatory hurdle as a success in exempting the efficacy·cost-effectiveness evaluation procedure during the 'third-contract termination evaluation' for pharmaceuticals on the basic refund-type RSA for over 10 years.

 

Even drugs that have been subject to fines or other administrative sanctions can still have their prices increased through negotiations with the National Health Insurance Service (NHIS) if supply shortages disrupt patient care.

 

For example, if a pharmaceutical company that produces plasma fractionation products can prove production cost increases based on additional research into pricing models for raw plasma and related inputs, the government covers not only past losses but also future cost escalations, a policy to raise prices accordingly.

 

This measure is regarded as a notable case of eliminating regulatory hurdle.

 

On March 25, the government convened the 6th Bio-Health Innovation Commission at the ARPA-H Promotion Team conference room on the 16th floor of City Tower in Jung-gu, Seoul, chaired by Director Kim Young-tae, Vice Chairman from the private sector and Director of Seoul National University Hospital, to discuss improvements to so-called "killer regulations." The Ministry of Health and Welfare (MOHW) suggested several regulatory improvement initiatives, including enhancements to the repeated re-evaluation process for risk-sharing agreements, revisions to the evaluation criteria for drug price caps, and establishment of a cost-calculation methodology for plasma fractionation products.

 

Under revised guidelines, drugs subject to a basic refund-type RSA contract that has been used for more than 10 years can exempted from the utility and cost-effectiveness assessment during the 'third-contract termination evaluation.' The MOHW believes these changes will help resolve issues such as the devaluation of new drugs due to repeated re-evaluation under risk-sharing agreements and the consequent delays in the domestic introduction of new therapies.

 

As of January of this year, the MOHW improved the evaluation criteria so that even drugs facing administrative sanctions, such as fines, can be considered for ceiling price adjustments to enhance patient treatment access and ensure pharmaceutical access.

 

In cases where drug supply shortages may disrupt patient care, it has become possible to negotiate with the NHIS to raise drug prices.

 

Furthermore, the government implemented the regulatory revision to improve plasma fractionation products' stable supply and cost-effectiveness.

 

After a decision by the Health Insurance Policy Deliberation Committee, a change has been made to the price ceiling for plasma fractionation products that are already listed.

 

If a manufacturer can substantiate, based on additional research into pricing models for raw plasma and similar inputs, that cost-increasing factors exist, then prices may be raised not only to cover past losses but also to account for future cost escalations.

 

The MOHW has also relaxed the criteria for accepting efficacy evidence in high-risk advanced regenerative medicine clinical trials.

 

In order to alleviate the burden associated with such high-risk studies of advanced regenerative medicine, the 'Guidelines for Reviewing and Preparing Advanced Regenerative Medicine Clinical Trial Plans' have been revised to establish exception criteria for safety and efficacy evidence.

 

Through these measures, institutions conducting regenerative medicine trials will be able to choose appropriate testing methods that can adequately demonstrate safety and efficacy, even if there are variations in administration routes or methods, provided that additional supporting data justifying changes in clinical design are submitted in line with the specific characteristics of each study.

 

Monitoring implementation of Bio-Health Training Strategies An assessment of the progress of 81 bio-health training projects, managed by nine ministries in 2024, revealed that a total of 44,800 bio-health professionals have been trained.

 

This figure far exceeds the target of 22,100 reported to the 2nd Bio-Health Innovation Commission last year.

 

The government analyzed that this substantial increase is due to growing interest in the bio-health sector, which has led to the establishment of new courses, increased demand for education, and an expansion of educational institutions.

 

In detail, in one of the four major areas of bio-health human resource development, such as "industry-based school education," enhanced practical training and strengthened industry-academia linkages have produced approximately 16,400 professionals.

 

In addition, around 20,000 individuals have been trained in the area of production and regulatory science, including workforce development (through institutions like K-NIBRT), regulatory science, and continuing education for current employees.

 

Furthermore, to support the NEXT semiconductor leap through core research human resource development, via initiatives in AI-driven drug development, specialized graduate schools, and programs for physician-scientists, about 8,000 professionals have been trained, and projects aimed at stimulating local employment and linking job creation with start-up support have also been successfully advanced.

 

This year, in line with the plans of the various ministries, 10 of the original 81 projects that have either been completed or will not be pursued this year will be excluded, while 7 new projects will be initiated.

 

In total, 26,900 professionals are planned to be trained across 78 projects.

 

Additionally, the government will focus on expanding interdisciplinary education, practical talent development programs, and initiatives for training professionals in new technology sectors within school curriculum.

 

Furthermore, the Bio-Health Innovation Commission has reviewed research findings reflecting input from industry and academic experts on the persistent mismatch between the supply and demand of bio-health professionals, and is now discussing future strategies based on these insights.

 

The research identified the primary factors contributing to the human resource mismatch as a lack of industry input in university curriculum, a skewed focus in human resource development that leaves a gap in understanding specialized fields such as new technologies, and a shortage of expert personnel (professors and instructors).

 

In response, the Commission agreed on the importance of cultivating professionals tailored to corporate needs, training professionals to meet future demands in new technologies, and training globally competitive expert instructors.

 

Going forward, the government plans to publish a '2025 Bio-Health Talent Development Business Guide' in May to boost awareness and participation among job seekers, schools, and educational institutions regarding these talent development initiatives.

 

Going forward, the government plans to publish a '2025 Bio-Health Talent Development Business Guide' in May to boost awareness and participation among job seekers, schools, and educational institutions regarding these talent development initiatives.

 

Director Kim stated, "At today’s meeting, we were able to discuss topics on a government-wide support plan to maximize industry capabilities by reviewing the implementation status of bio-health human resource development projects and improvements in regulatory issues," adding, "We will continue to monitor these issues regularly at the level of the Bio-Health Innovation Commission and strive to ensure that today’s discussions are reflected in government policies, aimed to achieve clear outcomes."