‘Much work remains to be done for new drug access in Korea'

"will work to accelerate introduction of new drugs and their expenditure structure, etc"

Kyung-Eun Bae (Kay Bae ), Chair of the Korean Research-based Pharmaceutical Industry Association

"Government preferential measures are encouraging...should recognize the practical value of new drugs”

"Will continue discussions with the government to improve post-marketing management and expenditure structure.”

Kyung-Eun Bae (Kay Bae ), Chair of the Korean Research-based Pharmaceutical Industry Association

Kyung-Eun Bae (Kay Bae, 53) has risen to become the 'center' of the pharmaceutical industry.

 

After being appointed as the general manager to lead subsidiaries including Korea, New Zealand, and Australia of the Sanofi Group, Bae was also appointed Chair of the Korean Research-based Pharmaceutical Industry Association (KRPIA) Being appointed to head the association representing multinational pharmaceutical companies in Korea along with Sanofi Group’s major Asia-Pacific countries, Bae has become a key figure in communicating with the industry and regulatory authorities, including Sanofi headquarters and the Korean government.

 

Bae’s appointment came at the busiest time.

 

Bae has received an offer every time the KRPIA Chair position became open, but she has turned down the offer up to now.

 

And in a situation where her scope of work became broader than ever before, she accepted the long-declined offer.

 

Serving as KRPIA Chair at the busiest time of her career, there had been concerns amid rising expectations about whether Bae would be able to do her part and perform both roles well.

 

As a control tower, KRPIA has been working to make new drugs more affordable than ever before.

 

Making proposals to reform the drug pricing system and engaging in government communications for its support has become a key role of the association.

 

In her two roles, Bae will be overseeing two of Korea’s regular drug pricing reference countries - New Zealand and Australia – at Sanofi, and be determining KRPIA’s key message and strategy on behalf of the industry.

 

In other words, Bae may be best positioned to make the most appropriate policy recommendations.

 

Dailpharm met with Bae to find out more about her new roles.

 

- Your appointment as KRPIA Chair came as a surprise because I thought you were going to turn down the position again. I became the head of Sanofi Australia and New Zealand and the Chair of KRPIA at the same time.

 

I was hesitant at first because I didn't think I had the capability yet.

 

However, I have always felt that I should contribute to the association's development because KRPIA's mission aligns with the values that global pharmaceutical companies deem important.

 

I thought this year was the right time to take on the role.

 

It seems to be that time of life for me when I’m destined to work.

 

So I plan to dedicate myself to the work at hand while taking care of my physical health.

 

I apologize for the unpredictability (laughs).

 

- This is a very important time for multinational pharmaceutical companies.

 

Looking at the government's policy direction, although there are still some policies that add pressure, there are also positive signals, such as the recent plan to compensate for the value of innovative new drugs. The phrase 'new drug value recognition' appeared for the first time in the 'Second Comprehensive National Health Insurance Plan' released by the government this year.

 

It's a good start and an encouraging achievement as it lays the groundwork for improving patient access, including recognizing the innovativeness and value of new drugs and strengthening coverage for seriously ill patients.

 

However, it is important to come up with concrete measures that are effective in practice so that new drugs can be supplied to patients quickly and lead to a virtuous cycle of R&D.

 

-What are the KRPIA's recommendations to the government to address the practical issues you mentioned? There are two main areas I would like to point out.

 

First, Korea is still too late in introducing new drugs.

 

Statistics show that the percentage of new drugs introduced in Korea within 1 year of initial global (US, EU, etc.) approval is only 5%, which is very low compared to Japan and the US.

 

Whether a new drug can actually be used by patients is most important.

 

To address this issue, Korea has a Global Innovative Products on Fast Track (GIFT) system in place.

 

However, we need to check whether the system is really shortening the review period and where the bottlenecks are.

 

I think we first need to come up with a solution for drugs that are in urgent need of introduction.

 

The second is in recognizing the value of new drugs.

 

Companies are motivated when the value of new drugs is recognized, which in turn generates profits and creates a virtuous cycle of R&D.

 

This ultimately requires a significant change in drug pricing policies, including a dramatic improvement in ICER values.

 

When global pharmaceutical companies consider whether to invest in R&D in China, Japan, Southeast Asia, and Singapore, among other countries, they have to prioritize investing in countries with a strong R&D reputation.

 

From an industrial perspective, this is why we need to move to reinforce Korea’s R&D competitiveness.

 

Also, due to limited national health insurance finances, we need to take a look at the expenditure structure.

 

In terms of the proportion of new drugs in drug expenditures, new drugs account for 60 to 70% of all drug expenditures abroad, but they account for less than 10% in Korea.

 

We need to reorganize the inefficient systems that allow polypharmacy and clinic shopping.

 

This way, we can budget for new drugs without putting a strain on insurance finances.

 

-It was also surprising to see KRPIA voice the need to improve Korea’s expenditure structure.

 

structure.

 

Multinational pharmaceutical companies have been cautious in speaking out on the issue because the domestic market still has a strong tendency to look at new drugs as being from multinational companies, and generic drugs from domestic companies. Many were surprised that we released data on Korea’s drug expenditure structure (and the proportion of new drugs) last year.

 

However, the government should be encouraging domestic companies to develop new drugs now.

 

From the PE exemption system to ICER valuations, everything is connected, so KRPIA plans to communicate with the government on the issue whenever there is an opportunity.

 

-It was also unexpected that KRPIA would request the government to disclose the discussions and results of committee reviews (such as those by the Pharmacoeconomic Evaluation Subcommittee) that new drugs undergo in the reimbursement process. Of course, securing the transparency of the reimbursement process may be a cautious matter for companies due to each company’s strategic secrets and so forth.

 

But in the big picture of healthcare, patients are waiting.

 

Information sharing is really important for decision-making.

 

Transparency in that area is a win-win for the companies.

 

I think this is why the government has been responding to many of the requests.

 

-The government's efforts to strengthen post-listing control of drugs are also expected to be in full swing this year.

 

Policies such as those that utilize real-world data (RWD) and switching the pharmacoeconomic evaluation exemption system to a temporary deferral of evaluation system may be of concern and dissatisfaction to KRPIA. I think post-listing control is necessary in part to manage the overall insurance finances.

 

However, Korea’s post-management system is not integrated and is too fragmented, including the PVA (price-volume agreement), which often results in redundant drug price reduction mechanisms From the company's point of view, the system needs to be simplified to be predictable.

 

Currently, the government operates a follow-up system that focuses only on drug prices, such as PVA, which creates a high administrative burden.

 

I would like to see a system that takes into account the structural aspects, such as strengthening health insurance coverage for severe diseases over mild diseases.

 

There seems to be too much focus on just reducing drug prices.

 

Strengthening post-listing control without improving the system and policies for rapid new drug registration in Korea will eventually lead to another decline in access to new drugs.

 

KRPIA is preparing a report on the problems of the post-listing control measures and suggestions for their improvement that we plan to propose to the government based on the views of professionals with extensive experience in the field.