Further Crackdowns on Rebates in Korea

As reported in earlier issues of PBM’s Asian Medical e-Newsletter, Korea’s Ministry of Health has been cracking down on rebates in Korea. On August 1, 2009 the Ministry of Health, Welfare & Family Affairs implemented regulations where drug prices will be reduced if they violate distribution laws by offering rebates. Rebates include discounts on the price of drugs. They also include spending more than 100,000 won (approximately $85) for a doctor’s meal.

In addition, other regulations include that drug companies must limit non-financial benefits to 500,000 won (approximately $420) a year and any financial incentives to agree on drug supply deals are banned. Promotional meetings held at headquarters of foreign pharmaceutical companies are also banned. In addition, pharmaceutical companies are restricted in financing overseas academic conferences to only those that are officially approved. Also, only presenters or speakers are allowed to attend.

If a violation is discovered, the price paid for the drug will be lowered by up to 20% starting next month.