Korea Improving Drug Reimbursement

As mentioned in our July Pacific Bridge Newsletter, Korea plans to increase drug reimbursement for innovative, cancer and rare disease drugs. This reimbursement increase has been confirmed in the recently released Seoul National University R&DB Research Foundation report.  In addition to better pricing, Korea will expedite the time to get drug reimbursement approval too. In the past, getting Korean drug reimbursement often required a number of effort and could take up to 1,000 days. This timeframe was way more than the drug reimbursement timeframe in the US, EU, or even Japan. However, as Korea initiated programs for risk sharing (RSA) and a waiver system for cost-effectiveness (CEA), drug reimbursement timelines have been cut by about 50%.

Under the RSA plans, about 70 innovative drugs were reviewed by Korea’s HIRA reimbursement agency. On a percentage basis, more of these drugs were reimbursed than in the past. A larger share of these drugs also proceeded through the reimbursement review on the first or second try. Similarly, Korea’s CEA waiver program looks to expedite the time to reimburse drugs that do not show strong evidence of their efficacy,  but meet certain other criteria, like clinical usefulness. Today, a number of drugs that received reimbursement, were evaluated without CEA. Finally, the Korean National Health Insurance Service (NHIS) and the Korean MFDS have also shortened the time for drug reimbursement by promulgating a reduced time for price discussions from 60 days to 30 days. Also in play is a pilot plan for a new linkage system that will evaluate an innovative drug product application, reimbursement application and final price determination simultaneously, not sequentially.

Written by: Ames Gross – President and Founder, Pacific Bridge Medical (PBM)
Mr. Gross founded PBM in 1988 and has helped hundreds of medical companies with regulatory and business development issues in Asia. He is recognized nationally and internationally as a leader in the Asian medical markets. Mr. Gross has a BA degree, Phi Beta Kappa, from the University of Pennsylvania and an MBA from Columbia University.