A new drug preferential law will be promoted

For innovative pharmaceutical development

Delayed enactment due to trade such as the Ministry of Health and Welfare and the Korea-US FTA

The MOHW announced that it will start enacting subordinate laws to substantially implement and secure the effectiveness of the "clause for preferential treatment of new domestic drugs" developed by innovative pharmaceutical companies under the Special Act on the Pharmaceutical Industry.

 

The "upper limit price preferential treatment of drugs" stipulated in Article 17-2 of the Special Act on the Pharmaceutical Industry was newly established on December 11, 2018, but criticism has been raised as the Presidential Decree and enforcement regulations have not been created for nearly three years.

 

On the 12th, the MOHW responded to individual written inquiries from Rep.

 

Nam In-soon of the Democratic Party of Korea, a member of the National Assembly's Health and Welfare Committee.

 

Rep.

 

Nam asked why, background, and cause sub-laws related to the preferential provisions for new drugs developed in Korea, including Article 17-2 of the Pharmaceutical Industry Act, have not been made for years.

 

The pharmaceutical preferential provisions in the Pharmaceutical Industry Act are of great interest not only in the National Assembly but also in the domestic pharmaceutical industry.

 

Domestic pharmaceutical companies say that they need a system that recognizes drug prices higher when pharmaceutical companies selected as innovative pharmaceutical companies make new drugs in Korea to promote their willingness to develop new drugs in Korea.

 

Domestic companies are calling for the MOHW to show some preferential treatment in terms of follow-up management of drug prices if it fails to create subordinate laws due to concerns over trade friction with foreign countries such as the United States.

 

The intention is that the introduction of measures such as delaying the start of PVA negotiations or limiting the number of times will provide an environment that actually favors the price of new domestic drugs without having to think about ordinary problems.

 

An official from pharmaceutical company A, which owns a new domestic drug, said, "The drug price depends on the first registration after development and post-marketing follow-up management.""If it is difficult to give preferential treatment to drugs when registering as a normal problem, if we give preferential treatment to new domestic drugs during follow-up management such as PVA, the system will be effective without any problems," he said.

 

An official from Company A added, "If the start of follow-up management such as PVA is delayed further, the follow-up price will be applied after the new domestic drug has sufficiently established itself in the Korean market.

 

I think it is one of the ways to realize the system's goals without ordinary friction.

 

Rep.

 

Nam In-soon, who sympathized with the domestic pharmaceutical industry's position, also pointed out the responsibility for the situation to the MOHW and urged for improvement.

 

In particular, Rep.

 

Nam presented an example in which foreign countries provide drug preferential treatment for locally approved new drugs.

 

According to data submitted by the MOHW to Rep.

 

Nam, in Japan, 10-20% is applied to new drugs that were first approved prior to other countries.

 

In addition, in Japan, 5-20% of new drugs that explicitly contain dosages for children are subject to additional calculation.

 

However, if there is no clinical result that includes Japanese children in the country, the relevant addition is excluded.

 

Taiwan is applying an additional 10% to new drugs that have conducted clinical trials on a certain scale or larger that have proven their effectiveness in the country.

 

The MOHW plans to consult with related agencies such as the KPBMA regarding the absence of subordinate laws and regulations under the Pharmaceutical Industry Act.

 

Regarding the reason for not enacting subordinate laws for more than two years, the MOHW explained that it had no choice but to be cautious because it could lead to trade disputes with foreign countries.

 

In addition, the MOHW says that some preferential measures are already being implemented for generics and biosimilars made by innovative pharmaceutical companies.The MOHW adds the first one-year drug price to innovative pharmaceutical companies when applying insurance after developing generic products based on "drug decision and adjustment standards." An additional rate of 68% for innovative pharmaceutical companies and 59.5% for other pharmaceutical companies were set.

 

The MOHW said, "On December 11, 2018, a provision for preferential drug treatment for innovative pharmaceutical companies was prepared under the Special Act on the Pharmaceutical Industry." It said, "However, drug treatment for certain companies can lead to trade disputes with foreign countries, so careful review is necessary." It said, "The global innovative drug preferential system, which favored drug prices developed by innovative pharmaceutical companies, has been excluded from the FTA revision negotiations between Korea and the U.S.," adding, "There are no sub-laws for domestic new drugs, but some preferential treatment such as generic and biosimilars are being implemented." The MOHW then promised, "We will consult with related agencies to review drug support measures, including the enactment of subordinate laws, so that innovative pharmaceutical companies can be supported while avoiding trade friction in the future."