[Reporter's View] Special act on supply stability is incomplete

The government's core values in the recent drug pricing system reform are innovation and supply stabilization. Granting drug price exceptions by establishing new designations—namely 'semi-innovative companies' and 'supply stabilization leading companies'—is also intended to support these two core values.

Because this approach rewards corporate status rather than individual products, the underlying implication is: 'We will guarantee profits, so use those financial resources to contribute to R&D and supply stabilization.'

While the purpose of creating a virtuous cycle of compensation is the same, it is regrettable that the exceptions applied lack consistency.

Innovative and semi-innovative pharmaceutical companies receive preferential treatment not only in the pricing calculation of newly listed drugs, but also a separate preferential grace period of 3 to 4 years in the re-evaluation of already-listed drugs. The purpose is to recognize a company's R&D investment achievements not only for new products, but also in price adjustments for existing products.

In contrast, while supply stabilization leading companies can receive preferential treatment in the pricing calculation of new generics, they receive no separate benefits based on corporate status in the re-evaluation of already-listed drugs.

Supply stabilization leading companies can be selected only if the number of essential drugs subject to market withdrawal prevention, or their share of total billing, accounts for 20% of the company's total products or billing amount. If innovative and quasi-innovative designations are granted based on R&D investment, related infrastructure, and new drug development potential, supply stabilization-leading companies can be selected only once their current contributions are verified.

In other words, exceptions in re-evaluating already-listed drugs do not apply to verified contributions to supply stabilization. In contrast, exceptions do apply to the evaluation outcomes of research investment and development potential.

Unlike innovative and semi-innovative companies, applying exceptions to supply stabilization-leading companies appears challenging because the list changes annually.

This is because, in a drug price reduction process that spans up to 10 years, it is difficult to reflect corporate statuses that change each year, which could be confusing. The government is reportedly determined that the innovative certification system is more stable, operating on a 2-year certification cycle and a 3-year status retention period.

As a result, the government decided to establish a drug price fluctuation mechanism when status changes occur for innovative and quasi-innovative companies, while choosing not to grant grace-period exceptions to supply-stabilization companies.

Through this reform, the government aims to curb indiscriminate generic entry and strengthen listing management. The more strictly the entry of new products is managed, the more critical the role becomes for companies that remain in the market to produce necessary medicines.

In that regard, we hoped that a mechanism to re-evaluate already-listed drugs for supply stabilization would also be designed so that this reform would be even more complete.