President Obama has declared his intentions to move forward with the Korea – U.S. Free Trade Agreement (KORUS). Written three years ago under President Bush, it includes provisions on the pharmaceutical and medical devices markets. Korean parliament has already passed the deal, while the Obama administration has yet to do so.
The agreement will expand markets for many sectors, including pharmaceutical products and medical devices. Most notably, KORUS details a commitment towards transparency in the pricing and reimbursement process, a provision for the creation of an independent review mechanism for pricing and reimbursement decisions in Korea, and an agreement to establish a patent linkage system to ensure adequate enforcement of pharmaceutical intellectual property rights.
After meeting with South Korean President Lee Myung-Bak at the Toronto G20 summit, Obama announced that he wants issues blocking the agreement resolved by the Seoul G20 summit in November. Despite Obama’s enterprising attitude, he faces much opposition from his own Democratic party, who fear that this bilateral agreement will make U.S. industries more vulnerable to Korean competition.
The existing agreement has already been politically sensitive in Korea, with the Korean government expressing reluctance to renegotiate it a third time.