Will there be a designation for "ultra-innovative pharma"?

Representative Han Jia says, "Intensive investments are needed to foster blockbusters"

Has criticized healthcare R&D cuts…the Ministry of Health and Welfare (MOHW) says, "Our efforts to secure funding were inadequate"

A proposal has been made to establish an "Ultra-Innovative Pharmaceutical Company" designation, positioned one level above the existing Innovative Pharmaceutical Company category, to intensively foster domestic drugmakers capable of developing global blockbuster therapeutics.

Minister of Health and Welfare Jeong Eun Kyeong also agreed on the need for an ultra-innovative company category, saying the Ministry of Health and Welfare (MOHW) will review detailed support mechanisms and implementation methods.

Representative Han Jia of the People Power Party.

On the 8th, Representative Han Jia of the People Power Party urged the government, during the MOHW's parliamentary audit, to establish proactive support measures to meet its stated target of creating three blockbuster drugs.

Rep. Han stated, "The Lee Jae Myung administration has declared initiative to generate three blockbuster novel drugs. However, across 35 ongoing healthcare R&D projects, KRW 106.3 billion was slashed compared to planned budgets, and 156 executing institutions saw their R&D funding cut without prior notification."

Rep. Han continued, "Eighty-seven projects faced budget cuts without any performance evaluation," pointing out that "this runs counter to the stated ambition of producing blockbuster novel drugs."

Rep. Han also argued that for domestic companies to develop global novel therapies, they must have the financial strength to sustain large-scale clinical trials and build global clinical and distribution networks.

Lawmaker Han said, "Over the 27 years since 1999, not a single domestically developed drug has become a blockbuster. Capital capacity to conduct clinical research is vital, as are global clinical networks and distribution channels."

Citing the stark disparity in R&D expenditure between multinational corporations and domestic pharmaceutical companies, Rep. Han underscored the problematic nature of the R&D budget cuts.

Rep. Han pointed out that "Roche invests KRW 20.4 trillion annually in R&D, whereas the top 10 domestic pharmaceutical firms combined invest around KRW 2.2 trillion, a nearly tenfold gap," adding, "The government must, at least, refrain from cutting healthcare R&D budgets."

Rep. Han also called for scaling up the government-sponsored Phase 3 clinical trial support fund. Lawmaker Han said, "While establishing a Phase 3 clinical trial fund deserves positive recognition, its capital size is significantly inadequate. Rather than establishing a mega-fund, the government created a mini-fund."

Rep. Han especially emphasized the necessity to look beyond the government's current Innovative Pharmaceutical Company framework and intensively cultivate "frontier companies" capable of spearheading the global market.

Related to this, Rep. Han proposed introducing an "Ultra-Innovative" category that is positioned higher than the existing Innovative and Semi-Innovative tiers to provide full-scale support.

Rep. Han highlighted, "While diversified investments are necessary, concentrated investments are essential to cultivate industry giants. Rather than settling for semi-innovative and innovative designations, we must create a new tier for ultra-innovative enterprises," adding, "The government must run alongside industry by offering groundbreaking tax incentives, regulatory easing, and global partnerships. The pharmaceutical sector also needs frontier leaders like Samsung Electronics or SK Hynix."

Calls continued for a collaborative public-private framework to advance global novel drug development jointly.

Rep. Han stressed, "Companies cannot accomplish this alone, nor can the government succeed through its efforts alone," adding, "Only when the government and industry join hands can we secure position in the global pharmaceutical market."

Rep. Han further requested, "Please review the implementation of the Ultra-Innovative Pharmaceutical Company category, report on strategies to foster frontier enterprises through a comprehensive audit, and present measures to restore the reduced R&D budget."

Minister Jeong agreed that the government must strengthen support for the new drug and biopharmaceutical sectors.

Minister Jeong stated, "We agree that innovative support and structural reform are required for the novel drug and bio industries," adding, "Regarding the failure to secure the R&D budget, our efforts were insufficient." Minister Jeong concluded by stating, "We agree that there is a need for an ultra-innovative company framework. The ministry will review how to operationalize it and report back."