[Reporter’s View] New Drug Trends and Choline Alfoscerate

The Health Insurance Review and Assessment Service's Drug Reimbursement Evaluation Committee, which holds meetings every month, is the biggest hurdle to reimbursement in Korea and helps identify the latest new drug trends.

 

For several years now, the keywords that have led the trend were “anticancer drugs,” “rare drugs,” “biological drugs,” and “high-priced drugs.” Contrary to how the trend leaned toward chronic disease treatments that owned a large patient population in the past, biologic targeted treatments for a small number of patients have become the trend these days.

 

The characteristic of these drugs is that they are expensive.

 

In line with the trend, the Health Insurance Review and Assessment Service and the National Health Insurance Service are in the process of establishing a system to manage such high-priced anticancer and rare drugs.

 

Global pharmaceutical companies are now investing in anticancer and rare drugs with fewer patients and less competition, rather than developing synthetic drugs for chronic diseases, which become flooded with generics upon patent expiry.

 

The companies’ investments have now been making results at the Drug Reimbursement Evaluation Committee level.

 

However, the names of domestic pharmaceutical companies are rarely mentioned at DREC due to their lack of new drug development.

 

Occasionally, the release of a new homegrown drug arises as a hot topic, but usually, the main players deliberated by DREC are multinational pharmaceutical companies.

 

Domestic pharmaceutical companies are increasingly drifting apart from the new drug trend.

 

Traditional pharmaceutical companies have missed the timing when biosimilar development began in the mid-to-late 2000s.

 

When a bio-venture called Celltrion announced its challenge into the biosimilar field, the other companies ignored it, saying things like “there is no real profit” and “there is little chance of success.” When Samsung followed into the biosimilar market and achieved economies of scale, it was already too late.

 

Currently, the top 2 pharmaceutical and bio companies in Korea are Celltrion and Samsung Biologics.

 

I wonder what would have happened if domestic pharmaceutical companies had invested in biosimilars with the capital they had at the time, with a view to the future.

 

Biosimilars are just one trend.

 

The pharmaceutical market has been changing rapidly for the past decade.

 

New diabetes drugs have been introduced one after another, and the cancer drug market has evolved from treatments targeting resistant mutations to immuno-oncology drugs such as Keytruda.

 

The pace of pharmaceutical trends is too fast for Korean pharmaceutical companies to keep up with them, with the big pharma companies aggressively buying rare disease treatments through mergers and acquisitions.

 

Nevertheless, Korean pharmaceutical companies are still stuck in the past.

 

Many of the top-selling products of Korean pharmaceutical companies are the brain function enhancer, choline alfoscerate, which is already nearly 30 years old.

 

In 2020, the government’s re-evaluation reduced the indications for the drug, and even though clinical trials are still underway due to doubts about their efficacy, sales of choline alfoscerate drugs have grown.

 

It is a reliable cash cow for pharmaceutical companies.

 

On the 13th, the Supreme Court ruled in favor of the government in a lawsuit filed by 26 pharmaceutical companies to cancel the notice of selective reimbursement of choline alfoscerate.

 

With this ruling, it is likely that their selective reimbursement, which has been deferred with the lawsuit, will soon become a reality.

 

If reimbursement for the drug is only applied to dementia diseases and excludes mild cognitive impairment, choline alfoscerate will no longer be able to serve as a cash cow for domestic pharmaceutical companies.

 

While domestic pharmaceutical companies have managed to maintain their sales by defending the reimbursement reduction for their choline alfoscerate products for 5 years, this may have rather pushed companies to fall further behind in the market trends of anticancer drugs and orphan drugs.

 

Of course, there are also pharmaceutical companies, such as Boryung and Handok that are increasing investment in the anticancer and orphan drug markets.

 

However, there is concern whether most pharmaceutical companies will lose their investment timing as they struggle to maintain domestic sales, as was the case during the biosimilar boom.

 

The global market's number one immuno-oncology drug, Keytruda’s follow-on is a biosimilar, not a generic drug.

 

Celltrion and Samsung Biologics have just begun development efforts, but it is just a hope for domestic pharmaceutical companies.