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- 2026-04-30 19:05:34
- Opinion
- [Reporter's view] COVID-19 demand has disappeared
- by Nov 10, 2022 05:45am
- The boom of pharmaceutical companies, which had benefited from COVID-19, has subsided since the third quarter. Representatively, Roche Group suffered a sharp drop in sales of diagnostic kits and treatments in the third quarter. Roche Group supplies Actemra and Ronapreve, a treatment for COVID-19, and Roche Diagnostics manufactures a COVID-19 diagnostic kit. In the third quarter of this year, Actemra fell 42% year-on-year. Ronapreve's sales also shrank by 36%. Sales of Roche Diagnostics' COVID-19 diagnostic kit, which introduced the first COVID-19 diagnostic kit at the time of the outbreak of COVID-19, also fell sharply. Roche believes that it is no longer possible to benefit from COVID-19 from the third quarter. Roche CEO Severin Schwan said, "COVID-19 demand completely disappeared in the third quarter." It was judged that sales related to COVID-19, which had been on a roll until the end of last year, would not continue this year. Pfizer and Moderna's COVID-19 vaccine sales have also peaked in the fourth quarter of last year and have been on the decline in the first quarter of this year. Although the two companies were the fastest to respond to the COVID-19 mutation among the developers of the COVID-19 vaccine, a drop in sales was inevitable. Overall, the need for vaccination was lowered as the fatigue level of vaccination increased and the severity rate decreased as the coronavirus mutated. The situation of domestic pharmaceutical companies, which benefited from the COVID-19 vaccine and diagnostic kits, is similar. SK Bioscience, which focused on the production of COVID-19 vaccines, saw its sales and operating profit fall 59% and 79% in the third quarter, respectively. The company gave up the flu vaccine, which was its main source of sales, to produce the COVID-19 vaccine. It has also succeeded in developing the first domestic COVID-19 vaccine but has not yet led to profits. Domestic diagnostic kit companies, which recorded all-time sales with COVID-19 diagnostic kits, are also expected to receive sluggish report cards in the second half of the year. The only companies that still benefit from COVID-19 are Pfizer and MSD, which have developed COVID-19 treatments, and pharmaceutical companies that manufacture cold medicines. They are mainly companies that supply treatments for patients with mild COVID-19. In fact, SK Bioscience is considering resuming the production of flu vaccines next year. This is a measure to prepare for a decrease in the production of COVID-19 vaccines. Pfizer is expanding its sales excluding COVID-19-related sales as its existing flagship products are on a roll. However, market concerns are increasing for diagnostic kit companies that have seen the COVID-19 vaccine as the only source of sales or have excessively expanded sales to COVID-19. Countries have supported COVID-19-related diagnosis, prevention, and treatment at the government level, but the situation is expected to change next year. The United States and Japan are already considering charging COVID-19 vaccines or treatments. The loss of government support means that related companies will find it difficult to generate as many sales as they do now. It remains to be seen whether pharmaceutical and bio companies, which have benefited from the COVID-19 special for about two years, will be able to quickly prepare new growth engines.
- Opinion
- [Reporter’s View] Reimb for SLGT-2i combo still in discussi
- by Eo, Yun-Ho Nov 04, 2022 05:39am
- The agenda has been in the last stages of review for 5 months. At this pace, discussions on expanding reimbursement of SGLT-2 inhibitors as combination therapy may again be passed on to the next year. The discussion on expanding reimbursement of SGLT-2 inhibitors as combination therapy has remained stagnant for a long time. After no progress being made for over 3 years, the industry saw hope in listing their fixed-dose combinations with the Health Insurance Reimbursement and Assessment Service’s diabetes expert committee agreeing on integrating and recognizing reimbursement for the combined use of DPP-4 inhibitors and SGLT-2 class drugs and three-drug combination therapies. However, the year has changed since then, and no news of reimbursing of SGLT-2 inhibitor combos, which are under formal review by HIRA, has been released until now. HIRA had announced that the agenda was "in the final stages of determining reimbursement standards" in June, but now it is November. Moreover, SGLT-2 inhibitors are now under further pressure with the imminent expiry of their post-marketing surveillance term. Most of the SGLT-2 inhibitor drugs are required to submit PMS results by 2023-2024. This means the companies have only 1 to 2 years until the deadline. For PMS, companies need to secure and register hundreds to thousands of patients in their study. However, due to the characteristic of Korea’s antidiabetic drug market, non-reimbursed drugs cannot attract and make prescriptions. Unless the reimbursement issue is resolved, it would be virtually impossible for companies to fulfill the number of patients for PMS as required by the Ministry of Food and Drug Safety. A conclusion has to be made one way or another. The academic society has found consensus and submitted its opinion statement recommending reimbursement to be expanded to combination therapy, and the MFDS had changed the labeling category for SGLT-2 inhibitors from by ingredient to ▲monotherapy or ▲combined therapy. The baton is now in HIRA’s hands, and the institution must now cross the finish line. Also, an institutional arrangement should also be made. SGLT-2 inhibitor combinations are also prescription drugs, and there is no harm in playing caution. Although the government had taken too long, such a cautious stance was also necessary. If the class effect of SGLT-2 inhibitors is to be recognized, guidelines on 'the amount of time required to obtain sufficient prescription experience or the amount of prescription' should also be soon prepared.
- Opinion
- [Reporter’s View]Raising price of cold medicines not enough
- by Lee, Tak-Sun Oct 28, 2022 05:56am
- With the shortage of cold medicines remaining unresolved, the government proposed a drug price increase as its final card. The government decided to first take price adjustment applications for dispensed drugs that contain acetaminophen, which is cheaper than other cold medicines. The government had been implementing support measures such as monitoring supply and demand and easing GMP inspections among others to increase the supply of cold medicines that have been lacking due to COVID-19. Also, the government will exclude the amount used for COVID-19 patients from the amount counted for the price-volume agreement system. However, the measures weren’t enough to resolve the shortage. This was why the MFDS Minister Yu-Kyung Oh brought up raising the drug price at the NA Audit as the final card, saying that no other cards were left. Given that this came from the head of the MFDS, not the Ministry of Health and Welfare which is in charge of the price increase, reflects the limitations and frustrations in the support measures for expanding the manufacture of cold medicines so far. However, just a superficial drug price increase will not be enough to resolve the issue, because the ceiling price set for dispensed acetaminophens is too low. Currently, the ceiling price of the dispensed acetaminophen is set at KRW 11-32 for the 0.5g, KRW 26 for the 0.16g, KRW 29 for the 0.325g, and KRW 43-51 for the 0.65g strength. Considering how the over-the-counter 0.65g strength is sold at KRW 200 per tablet, pharmaceutical companies have no choice but to be less active in selling their drug for dispensing purposes. From the companies’ perspective, putting more weight on the over-the-counter products sold at pharmacies or supplying more expensive prescription drugs instead of acetaminophen helps improve company profits. Therefore, the industry believes the government’s price increase will not make a significant impact in increasing the supply if the increased amount is in a superficial range. If the government is to raise the drug price, the rate should be at the extent that considers the suppliers' needs. Moreover, the price should be raised soon. Considering the development of the COVID-19 crisis, applying the price increase in February next year after undergoing all administrative procedures will be too late. Of course, strict screening and negotiations to facilitate smooth supply are required, but if the purpose of the measure is to immediately increase the supply, the procedure should be boldly omitted. Also, prompt action must be taken in advance, as suppliers are likely to stock up on products and defer sales until the price increase is applied. Therefore, the government should also require companies to commit to expanding their supply along with the price increase. The price increase of cold medicines this time is made largely for the public interest of allowing the timely provision of such drugs to patients and long-term care institutions by expanding supply. In consideration of this, the government and pharmaceutical companies should closely work together to achieve the desired effect with the price increase measure.
- Opinion
- [Reporter's view] Two plays in the parliamentary audit
- by Kim, Jin-Gu Oct 25, 2022 05:46am
- A Member of Parliament asks about the need to introduce a prescription for active ingredients. Then, whether it was the Minister of Health and Welfare or the Minister of Food and Drug Safety, he replied that he sympathized with the purpose. There is a strong backlash from medical groups. This concludes the play. The same is true this year. Seo Young-seok, a member of the Democratic Party of Korea, asked for the opinions of the Minister of Health and Welfare and the Minister of Food and Drug Safety on the introduction of a prescription for active recipients at a recently completed parliamentary audit of the National Assembly's Health and Welfare Committee. Oh Yoo-kyung, head of the Ministry of Food and Drug Safety, said, "I agree," and Minister Cho Kyu-hong avoided an immediate answer, saying, "I will discuss measures with the Ministry of Food and Drug Safety." The screenplay is much the same and only the actor changes every year. It is hard to find sincerity in both the National Assembly and the government that has raised questions and sympathized with the purpose. The introduction of the prescription of active ingredients is discussed only during the parliamentary audit season. This year's parliamentary audit also featured plays related to lowering generic drug prices. When Choi Jae-hyung, a member of the People's Power Party, pointed out that "the price of generic drugs is higher than that of advanced countries abroad," Minister Cho Kyu-hong replied, "We will find a way to lower them step by step." The authenticity doesn't feel much. There seems to be no fierce concern about the impact of the generic drug price cut on the domestic prescription market and the pharmaceutical industry. It seems to read the written script as it is, whether it is on the side of asking or answering. In 2012, the government implemented a package of weak cuts. At that time, the National Assembly pointed out that generic drugs were too expensive, and the government reorganized the drug price system under the pretext of financial reduction of health insurance. In the end, the damage caused by this was suffered by the domestic pharmaceutical industry. This is not to say that discussions on lowering generic drug prices should begin. It is repeated every season of the parliamentary audit. It is necessary to think more deeply about how much the shock is in the process of reading and answering the set script. As it is a huge topic that will shake up the pharmaceutical prescription market and the pharmaceutical industry, there should have been time to gather opinions, whether it is a debate or a public hearing, before simple questions and answers. The National Assembly and the government are expected to repeat the parliamentary audit next year similar to this year. The play with the obvious ending is not interesting. I hope that a more sincere and novel script will be written on the stage, where the theme of health insurance fiscal reduction is to be the theme.
- Opinion
- [Reporter’s View] LG Chem’s global two-track strategy
- by Oct 20, 2022 06:02am
- LG Chem announced the acquisition of a US biotech firm on the 18th. LG Chem will invest KRW 800 billion to acquire a 100% stake in AVEO Pharmaceuticals. This is the third-largest in the history of M&As made by domestic pharmaceutical companies. It is also the largest single-company investment along with SK's acquisition of Ampac. AVEO Pharmaceuticals is a 20-year-old biotech specializing in anticancer drugs. The company developed a vascular endothelial growth factor (VEGF) inhibitor and received FDA approval. Although its new drug, ‘Fotivda (tivozanib)’ is not a first-in-class drug, therefore not the first drug with that mechanism of action, it has much potential. Rather than directly attacking the tumor cells, VEGF inhibitors starve the tumor cells of the nutrition required for tumor cell growth by blocking the nutrition supply pathway. Due to this mechanism of action, it goes well with other anticancer drugs and also pairs well with the cancer immunotherapies that are expanding influence in the anticancer drug market. LG Chem has long been interested in advancing into the global market through new drug development. For this, the company established a local research center in the US 22 years ago, and also invested USD 5 million in a US bioventure for the development of an anticancer drug. Also, the company has spared no amount in R&D, with its company’s R&D-to-Total-revenue ratio reaching nearly 20%. The company was also the first Korean company to obtain approval for a new drug from the U.S. FDA. However, with new drug development being quite challenging in itself and management problems, LG Chem could not succeed in global expansions. LG Chem’s Life Sciences division was unable to continue the development of new drugs in the process of spin-offs, restructuring, and statutory mergers, and also lost a large number of professional personnel. Then, after absorbing LG Life Sciences in 2016, LG Chem restarted its attempt to advance into the global pharmaceutical market. The company secured cash cows – diabetes treatments, fillers, vaccines – to invest in new drug pipelines for autoimmune diseases, anticancer drugs, nonalcoholic steatohepatitis, etc. LG Chem owns 23 new drug and vaccine pipelines. Also, the company has recently started a global Phase III trial for a new gout drug candidate it has been developing. The trial is set to be conducted in the US, China, and Europe. In the field of oncology, the company opted to acquire a biotech. Of course, LG Chem already owns an in-house oncology drug pipeline that consists of 7 candidate substances. However, their development is not so easy as all are in the early stages of Phase I trials, and the company does not have much experience in developing anticancer drugs. Aside from the huge cost, even big pharmas with extensive commercialization experience, often discontinue the development of anticancer drugs midway. The acquisition of AVEO Pharmaceuticals will be an opportunity for LG Chem to understand all areas of anticancer drug development, approval, and sales. In addition to acquiring expert personnel that develops anticancer drugs, the company will be able to acquire the development know-how of big pharmas that have been conducting joint research with Aveo. Also, by transferring its own cancer pipeline to AVEO in the future, the company will be able to conduct global clinical trials more effectively. With the initiation of a global Phase III trial and the acquisition of AVEO this year, LG Chem made a big leap forward in advancing into the global market. Whether LG Chem's two-track strategy will bear fruit will remain to be seen.
- Opinion
- [Desktop] Increase accessibility by beating generic prices
- by Kim, Jung-Ju Oct 19, 2022 05:48am
- The direction of the government's guarantee policy has been consistent. It is to reduce finances by preventing inefficient operations and increase patient accessibility with sufficient funds. It's a kind of 'trade-off' way. At one time, there was a massive plan to strengthen the search for hospitals and pharmacies that illegally borrow licenses to prevent unfair claims and raise funds to improve coverage. However, hospitals and pharmacies do not easily lead to collection even if they are searched, so this does not have a significant impact on fiscal appropriation. Then how about the drug price? Generic has already been restricted to cascading hurdles, and the additional system maintenance and re-evaluation of registered drugs have been confirmed to enter the benefit. All drugs must cross the last hurdle of PVA, the concept of follow-up management. Even if you enter a low price in the first place, the price falls easily if selling a lot. Drugs that do not have competitive drugs with the same ingredients are included, and companies eventually decide to stop supply. The imbalance in the supply and demand of cold medicine applies PVA exceptions without worrying about fundamentally solving the problem. When planning such a generic regulation policy, the government explained that it was a strategy to strengthen accessibility by using it to register expensive new drugs by increasing trade-offs, that is, generic drug prices and follow-up hurdles. This price-pressure strategy, which comes out whenever the financial situation is shaken and the need to strengthen guarantees grows, is actually a relatively easy way to secure funds. There is definitely a limit to securing financial resources by cutting drug prices like this without managing prescriptions. We should not delay the diversification of resources to meet the growing need for guarantees, including expanding patients' options, resolving information refraction or asymmetry, activating alternatives and introducing prescriptions for ingredients, and improving consumer awareness.
- Opinion
- [Reporter’s View] The key to the ‘PE Exemption’ issue
- by Eo, Yun-Ho Oct 17, 2022 10:52pm
- The cries that the improvement reduces rather than expand benefits have reached the National Assembly. The government’s improvement plan for the special pharmacoeconomic evaluation (PE) exemption system was brought onto the chopping block at the NA audit. During the NA audit for the Health Insurance Review and Assessment Service that was held on the 13th, Rep. Sun-Woo Kang of the Democratic Party of Korea raised an issue on the PE exemption system improvement plan that had been submitted by the Ministry of Health and Welfare and HIRA. The “Measure to improve patient access and reinforce reimbursement management for high-priced severe disease treatments” that was recently presented by the government includes a measure to improve the PE exemption standards. According to Rep. Kang, unlike the authorities’ explanation, the drugs subject to PE Exemptions will be rather reduced if the improvement plan is applied. The “small number of eligible patients” which had previously been an “OR” clause for PE exemptions became a prerequisite in the proposed amendment, reducing the scope of eligible drugs. This issue has been raised continuously across the industry, including by the Korean Research-based Pharmaceutical Industry Association (KRPIA), since the government announced the amendment. In other words, the concern is that all drugs that wish to take the PE exemption track will have to have a “small number of eligible patients (less than 200 patients)” if the amendment is applied. On this, HIRA President Sun-Min Kim replied that “The 200 people limit is not absolute. All drugs that do not have enough patients to prepare evidence for PE evaluations are applied the PE evaluation exemption track.” In other words, the authorities will show some flexibility in the “small number” standard. However, the impact of this amendment is not only due to the changed premise. If the amendment is applied in the current state, all drugs that wish to take the PE exemption track have to have a small number of patients (as defined as 200 in the current criteria) and receive recognition from the committee for its difficulty in producing evidence to satisfy Article 2.c of the regulation. In other words, the companies will not be able to know if their drugs are eligible for the PE exemption track until HIRA’s Drug Reimbursement Review and Assessment Committee make a decision. This will inevitably have a significant impact on the predictability of reimbursement listings for companies that wish to use the PE exemption system. Considering how the new administration promised rapid listing of anticancer and rare disease drugs immediately upon its inauguration and the non-reimbursed blind spots still remain for drugs that are applied special exemptions, the government needs to seriously consider whether this amendment is achieving its original purpose.
- Opinion
- [Reporter’s View] Real crisis will come after COVID-19
- by Kim, Jin-Gu Oct 05, 2022 06:11am
- Contrary to the hopes that peace will come with the end of the COVID-19 crisis so near, another crisis of the ‘three highs’ - high exchange rates, high interest rates, and high inflation – has now arrived. Experts are predicting shock waves at the level of the 1997 IMF crisis and the 2009 global financial crisis or severer. Externally, the exchange rate, trade balance, and current account are shaking at the same time. Internally, red lights are flaring in Korea’s growth rate, price level, and interest rates. The future outlook is also bleak. Negative prospects are pouring in, that the low growth will continue for the time being, resulting in fewer jobs and a contraction in investment. Some analysts believe we have already entered stagflation, in which high inflation and economic downturn occur at the same time. Obviously, the domestic biopharmaceutical industry cannot be immune to this macroeconomic trend. The high exchange rates, high interest rates, and high inflation constrain the pharma and bio companies from all directions. Anxiety is growing bigger and bigger, and with the growing anxiety, companies contract. Given that the long-term investments made by the industry are just beginning to bear fruit, concerns are being voiced that the potential of the K-pharmaceutical and bio industry will be nipped in the bud, without blooming to its full potential. The Korean pharmaceutical and bio industry is considered to have made good progress during the past 3 years in the COVID-19 crisis. Some companies have used the crisis as an opportunity to grow significantly or to attract large-scale investments. It is not that the industry has fared well, but it is difficult to say that the COVID-19 crisis has been overcome solely by the capabilities owned by Korea’s pharmaceutical and bio industry. Pharmaceuticals are consumer staples, therefore, the industry was not greatly affected by the surge of confirmed COVID-19 cases or strengthened social distancing measures, etc. Also, much of the cash released through the quantitative easing measures competitively carried out by countries had flowed into the industry. In such a sense, it is true COVID-19 did not greatly impact the pharmaceutical industry as much as other industries. The government believes that COVID-19 will turn into an endemic by early next year. The pandemic is finally coming to an end. With the declaration of an endemic so near in sight, the pharmaceutical and bio companies are now on the testing bed. How well the companies have built their foundation will be tested in the era of the ‘three highs.’ Experts have contrasting views on how long the factors of concern represented by the ‘three highs’ will last. However still, one thing certain is that the companies must now brace for the long-term recession that is certain to come. Executives would need to make cool-headed judgments about the situation and set the right direction. The real crisis has only just begun.
- Opinion
- [Reporter's view] Reimbursement of Zerbaxa
- by Eo, Yun-Ho Oct 04, 2022 06:07am
- Super antibiotic Zerbaxa will receive insurance benefits from this month. It is the first time in about five years that a domestic permit has been granted. The government's response to the application of the PE system to some of the national essential drugs, especially in the face of the seriousness of antibiotic resistance issues internationally, has made new antibiotic drugs. Even though it is not a "life-threatening disease," the need for important drugs has been recognized. Zerbaxa was approved in Korea in April 2017, but the prevailing view was that it was difficult to register under the system at the time. This is because new antibiotic drugs are not easy to prove cost-effectiveness compared to existing conventional drugs, and it is difficult to prove clinical superiority due to the nature of the drug. In fact, an application for Zerbaxa was submitted in the second half of 2018 and went through the procedure, but failed to pass the HIRA Drug Benefit Evaluation Committee in 2019. Since then, the government has implemented an improvement plan to include essential drugs such as antibiotics in PE targets as a way to expand coverage. The government designated antibiotics as PE targets, limiting the scope of antibiotics to antibacterial agents such as Zerbaxa. The medical concept of antibiotics refers to antimicrobial medics, which encompasses antimicrobial agents (treatment of bacterial infections), antimicrobial agents (treatment of fungal infections), and antiviral drugs (treatment of viral infections). This continuous increase in antimicrobial resistance is considered the most important public health agenda worldwide. The WHO defines the concept of AMR as 'a threat to the effective prevention and treatment of continuously increasing infections caused by bacteria, parasites, viruses and fungi'. AMR is not limited to the well-known superbacterial outbreak problem. Antibiotic resistance, also called Superbugs, refers to changes that occur when microorganisms (such as fungi, viruses, parasites, etc.) that cause infection, including bacteria, are exposed to antibiotics, antifungal drugs, and antibacterial drugs. In fact, the real liberation of antibiotics has not been achieved. As the benefits of step by step one goes a long way. Zerbaxa began, the medical environment in Korea has improved little by step. With a round of applause, it adds to the remaining concerns.
- Opinion
- [Reporter's view]Bio-Administrative Orders of the USA
- by Kim, Jin-Gu Sep 23, 2022 05:51am
- Korea's CDMO (consignment development production) industry, which has just begun in earnest, has a hurdle. U.S. President Joe Biden recently signed an executive order for the "National Biotechnology and Bio Manufacturing Initiative," which calls for the production of biopharmaceuticals in the country. The Biden administration is emphasizing "Made in USA" every day ahead of the upcoming midterm elections in November. Along with the automobile and semiconductor industries, CDMO, one of the pillars of the pharmaceutical bio industry, has become a target. The decision is based on political intentions, but the intention is expected to have a significant impact on the domestic industry anyway. In the pharmaceutical bio industry, Samsung BioLogics is expected to be affected the most. Samsung BioLogics has been investing generously for the past 10 years. Since two to three years ago, orders for consignment production of biopharmaceuticals have been pouring in from around the world, including the United States. When the fourth plant is completed next year, it will become the world's top production base. However, if the administrative order is materialized, Samsung BioLogics' plan to occupy more than 30% of global biopharmaceutical CMO production is also expected to be disrupted. Just last year alone, about 20% of the company's sales came from the United States. It is not just a problem for Samsung BioLogics. After Samsung BioLogics presented a successful model, many pharmaceutical companies in Korea have entered the CDMO business. As an industry, not a company of Samsung BioLogics, the seed of CDMO was sown. However, the crisis has hit even before it is properly sprouted. The bigger problem is the possibility of U.S. protectionism spreading around the world. Protectionism is highly contagious. This means that if the U.S. takes action first, the world, including Europe, will likely jump into protecting its industries. Concerns are raised about the K-CDMO industry in that most companies that have entered the CDMO business are limited to Korea. The government seems to be aware of these concerns. The Ministry of Health and Welfare and the Ministry of Trade, Industry and Energy plan to hold a joint meeting of government ministries in the near future and come up with countermeasures related to the U.S. executive order. It plans to summarize South Korea's position here and deliver it to the U.S. during the South Korea-U.S. ministerial meeting this week. A single diplomatic negotiation cannot solve all the problems. With all possibilities in mind, other additional measures should be prepared. It is time for the government, which said it will focus on fostering the pharmaceutical bio industry, to show its true will with diplomatic power.
