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- 2026-04-21 15:18:27
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- Sears turns profit, seeks expansion from Middle East
- by Hwang, byoung woo Feb 05, 2026 07:47am
- Seers Technology, having solved the long-standing profitability challenge in Korea’s medical AI industry, has now proposed building ‘global smart wards’ as its next step.Leveraging its integrated healthcare model that starts from inpatient monitoring and extends to outpatient and home care, Seers plans to accelerate its global market expansion from the Middle East.At an investor relations (IR) event held in Yeouido on the 4th, Seers unveiled its achievement of turning an annual profit in 2025 and its blueprint for a quantum leap as a healthcare platform company.“Workflow improvements felt by HCPs, the key to profitability”Young-shin Lee, Founder & CEO of Seers TechnologyAt the event, CEO Young-shin Lee cited “hospital workflow optimization” as the core driver behind the company’s return to profitability.Lee said, “Hospitals are not just places for treatment, but spaces where patients are continuously monitored and managed. To extend real-time monitoring beyond intensive care units to general wards, we focused on workflow improvements that reduce medical staff's workload.”Seers’ inpatient monitoring platform, thynC, continuously collects and analyzes vital signs from all patients across the entire hospital wards.Once installed at the bedside, the platform is combined with a subscription-based service, which the company believes will create a virtuous cycle of recurring revenue from existing beds.Lee explained, “thynC is not a one-time installation; its structure builds recurring revenue over time from existing beds. From 2028, new deployments and renewals will overlap, driving full-scale profit leverage.”Seers reported 2025 revenue of KRW 48.2 billion, a 595% increase from KRW 8.1 billion in 2024. Operating profit also turned positive, swinging from a KRW 8.7 billion loss to a KRW 16.3 billion profit.By 2028, which is when Lee believes the profit leverage is expected to fully materialize, the company projects the number of hospitals using its platform to nearly double to around 400.The company views this structure as closer to an operational platform than simple equipment sales. It is a model that enhances hospital operational efficiency itself by linking patient biometric data with nursing records, electronic medical records (EMRs), and ward workflows.Middle East as a “model transplantation hub,” not just a sales market… medical fees 3–5 times higherA major focus of the briefing was Seers’ overseas strategy, particularly in the Middle East and North Africa(MENA).Seers has positioned the UAE as a strategic foothold for its global expansion and is collaborating with PureHealth, the largest state-owned healthcare group in the Middle East.Lee noted, “If the reimbursement for a one-day arrhythmia test in Korea is around KRW 60,000, in the Middle East it is three to five times higher. The scale of inpatient beds in the MENA region is also larger than in Korea, and the number of chronic disease patients is significantly higher, resulting in a fundamentally different revenue structure.”Seers’ approach is not simply product supply. The company plans to leverage PureHealth’s hospital network, insurance, and distribution infrastructure to deploy an integrated wearable AI healthcare model within local systems. This model encompasses ▲arrhythmia screening based on mobiCARE, ▲inpatient monitoring via thynC, and ▲remote patient monitoring (RPM) for home care. Proof-of-concept (PoC) programs for the full product portfolio are currently underway in stages.Lee emphasized, “Selling a few pieces of equipment overseas is unlikely to yield meaningful results. Our goal is to replicate the ‘hospital-outpatient-home care integrated model that has been validated in Korea.The company has set a target to raise the proportion of overseas sales to around 50% by around 2029 through this phased expansion strategy.Lee particularly conveyed the company's determination to penetrate the market based on technological specialization, noting that global giants like Philips and GE Healthcare already dominate the international arena.He stressed, “The Middle East market is a battleground where all global leaders compete. Seers distinguishes itself by internalizing the entire process—from materials to sensors and AI algorithms. We will secure references by winning against them to enter the US and European markets.”Additionally, Seers is pursuing a collaborative model linking real-time patient data accumulated via wearable devices to the pharmaceutical industry. The vision is to combine medication information with biometric data to expand into the realm of clinical and real-world data (RWD) applications.Lee concluded, “By achieving a 50% overseas revenue share by 2029, we aim to become a global wearable AI healthcare platform company. Our first-ever profitability milestone is only the starting line. We will continue to build a sustainable revenue structure while completing our global expansion.”
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- Pharma companies cut distribution margins in succession
- by Son, Hyung Min Feb 04, 2026 06:51am
- Generated using AIThe pharmaceutical distribution industry is mounting strong opposition as pharmaceutical companies successively cut distribution margins in the wake of the government's drug price system reform.According to industry sources on the 4th, one multinational pharmaceutical company has reportedly lowered distribution margins on certain products by approximately 5% compared with previous levels.In addition, several small and mid-sized domestic pharmaceutical companies are said to have begun implementing or reviewing margin cuts in the range of 1% to 4%.The distribution industry is concerned that these unilateral, unconsulted adjustments could destabilize the industry ecosystem.A distribution company official stated, “While we understand that pharmaceutical companies face increased burdens due to the drug price reform, reducing margins without discussion with distributors undermines the mutually beneficial structure.”A senior official from the Korea Pharmaceutical Distribution Association also pointed out, “Indiscriminate margin reductions shake the foundation of normal business operations. With logistics costs and labor expenses already significantly increased, further reductions are difficult to withstand.”In some quarters, calls have even emerged to reconsider handling products from pharmaceutical companies that have reduced margins. Industry sentiment is rapidly cooling, with distributors warning that accumulated profitability deterioration, combined with margin cuts, could directly lead to bankruptcy risks.Meanwhile, pharmaceutical companies maintain that this is an unavoidable adjustment to withstand the government's pressure for drug price reductions. However, the distribution industry is strongly protesting, claiming its survival is threatened, leading to an escalation of conflict between the two sides.Against this backdrop, the Korea Pharmaceutical Distribution Association is scheduled to hold its general assembly on the 4th to discuss response measures. Industry observers are watching closely to see whether the association will outline strategies such as ▲strategic negotiation with pharmaceutical companies ▲collective responses, including refusal to handle products ▲policy recommendations directed at the government.An association official emphasized, “The pressure structure between pharmaceutical companies and distributors must not be repeated due to changes in the drug pricing system. When designing policies, the government must reflect the realities of the distribution structure, and a consultative body involving pharmaceutical companies, distributors, and the government is necessary.”Ho-young Park, Chair of the Korea Pharmaceutical Distribution Association (right), also expressed concern at a New Year's press briefing last month about the potential reduction in distribution margins arising from drug price cuts.
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- Why new drugs are still not reimbursed within 150 days
- by Eo, Yun-Ho Feb 04, 2026 06:50am
- Questions continue to surround the effectiveness of Korea’s pilot program for parallel approval, assessment, and price negotiation.The Ministry of Health and Welfare has operated the parallel ‘approval–assessment–negotiation’ pilot program since 2023 to improve access to treatments for life-threatening severe and rare intractable diseases. The program’s core objective is to shorten the time required for new drugs to be listed on the National Health Insurance (NHI) reimbursement scheme by running regulatory approval, reimbursement assessment, and price negotiations in parallel. The stated goal is to reduce the reimbursement listing timeline, which used to take a maximum of over 300 days, to 150 days.As of 2026, expectations for the Approval-Evaluation-Negotiation pilot project were high, but the results appear to be less than satisfactory.The first pilot program, launched in 2023, concluded after nearly two years, which was longer than originally planned. Among the drugs included, Bylvay (odevixibat), the last to secure reimbursement status, took more than a year to listing.Similarly, the drugs selected for the second pilot project in December 2024—▲‘ Winrevair(sotatercept)’, ▲‘Rimqarto (anbal-cel)’, ▲‘Fintepla (fenfluramine)’—have not shown significant progress even though nearly a year has passed since the program began.At the start of the new year, the government announced plans to strengthen support for rare and severe intractable diseases, stating the intent to “reduce the reimbursement listing period for rare disease treatments, which previously took over a year, to 100 days through streamlining reimbursement appropriateness evaluations and negotiations.” However, skepticism remains within the pharmaceutical industry, questioning, “Given that even the ‘150 days’ target of the pilot project was rarely met, is this really feasible?”If the existing cost-effectiveness evaluation method remains unchanged, for chronic rare and intractable diseases requiring lifelong treatment, the longer a patient survives, the longer they must continue taking the medication. This means that while the drug improves survival and quality of life, the associated drug costs also increase.This structure makes it inherently disadvantageous to demonstrate cost-effectiveness and, in extreme cases, creates a dilemma in which a patient’s earlier death would paradoxically improve cost-effectiveness outcomes.A representative example is Winrevair, a pulmonary arterial hypertension (PAH) therapy included in the second pilot program. Winrevair is the first approved activin signaling inhibitor (ASI) in this therapeutic area, where drug development is particularly challenging. Unlike existing therapies focused on vasodilation, Winrevair improves vascular remodeling, the fundamental cause of the disease.Consequently, no comparable therapeutic alternative is available. If Winrevair is evaluated within the existing economic assessment framework, it would be compared to treatments developed two decades ago. This situation naturally delays the listing process. This challenge is not unique to Winrevair but is one commonly faced by drugs included in the parallel pilot program. Nearly 200 days have already passed since Winrevair received approval from Korea’s Ministry of Food and Drug Safety.Moreover, pulmonary arterial hypertension is a rare, severe, and chronically progressive disease. The longer patients receive sustained treatment to reach a low-risk group and maintain a favorable condition, the longer the drug is used. This creates the irony that proving cost-effectiveness becomes difficult precisely because the drug ‘keeps patients alive longer’. This is why flexible application of the ICER threshold is necessary.A representative from a multinational pharmaceutical company commented, “The parallel approval–assessment–negotiation pilot program was introduced to recognize the value of innovative medicines, yet it continues to apply conventional comparative evaluation criteria. The system was designed to improve access to innovative therapies for rare and severe intractable diseases, but it lacks evaluation standards capable of reflecting that innovation.”
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- HK inno.N’s GLP-1 drug approved in China for diabetes
- by Cha, Ji-Hyun Feb 03, 2026 06:24am
- HK Inno.N's GLP-1 class obesity and diabetes treatment, ecnoglutide (XW003), currently undergoing Phase III clinical trials in Korea, has received its first product approval in China. Its original developer, Saiwind Biosciences, obtained new drug approval for the type 2 diabetes indication from Chinese authorities, which is expected to bolster HK Inno.N’s domestic development strategy.According to the biotech industry on the 2nd, Sciwind received approval from China’s National Medical Products Administration (NMPA) on the 30th of last month (local time) for the injectable formulation of ecnoglutide indicated for glycemic control in adult patients with type 2 diabetes.Previously, Sciwind had submitted marketing authorization applications to the NMPA for ecnoglutide for type 2 diabetes and obesity indications in November and December 2024, respectively. The obesity indication is currently under NMPA review in China.Ecnoglutide's cAMP-biased GLP-1 receptor agonist mechanism (Source: Sciwind Biosciences)Ecnoglutide is the world’s first cAMP-biased GLP-1 receptor agonist. Compared with conventional GLP-1 therapies, it enhances signaling selectivity, resulting in prolonged efficacy and improved metabolic effects.The approval was based on results from the Phase III EECOH-1 and EECOH-2 clinical trials conducted in China by Sciwind. In the EECOH-1 study, patients with type 2 diabetes inadequately controlled by diet and exercise achieved a reduction in HbA1c of up to 2.43% after 24 weeks of treatment. In the EECOH-2 study, ecnoglutide demonstrated superior glucose-lowering efficacy compared with dulaglutide, an existing GLP-1 therapy, in patients receiving concomitant metformin. In both studies, sustained efficacy and safety were confirmed through 52 weeks of treatment.Upon the approval, attention is turning to the pace of development and future approval strategy for HK Inno.N’s obesity and diabetes pipeline currently undergoing Phase III clinical trials in Korea. HK Inno.N signed a licensing agreement with Sciwind in May 2024 to secure exclusive domestic development and commercialization rights for ecnoglutide. Under the agreement, Under the agreement, HK inno.N paid an upfront payment, milestone payments tied to development stages, and royalties based on post-launch sales.HK Inno.N is currently conducting a Phase III clinical trial for ecnoglutide targeting the obesity indication. Recruitment for the domestic Phase III trial was completed last January, and the trial has now entered the dosing phase. HK Inno.N received Investigational New Drug (IND) approval from the Ministry of Food and Drug Safety in May last year. After enrolling the first patient in September, HK inno.N completed recruitment of a total of 313 participants in approximately four months.The Phase 3 study is being conducted at 24 medical institutions, including Kangbuk Samsung Hospital, and targets adult Korean patients who are obese or overweight without diabetes. Participants receive once-weekly subcutaneous injections of either ecnoglutide or placebo to evaluate efficacy and safety. The primary endpoints are the percentage change in body weight from baseline at week 40 and the proportion of participants achieving at least a 5% reduction in body weight.
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- Bylvay may be prescribed at Big 5 Hospitals in Korea
- by Eo, Yun-Ho Feb 03, 2026 06:24am
- Bylvay, the first drug approved under Korea’s parallel approval–assessment–negotiation linkage pathway, has successfully secured prescribing access at major tertiary hospitals.According to industry sources, Ipsen Korea’s Bylvay (odevixibat), a treatment for pruritus in patients aged three months and older with progressive familial intrahepatic cholestasis (PFIC), has been approved by the Drug Committees (DCs) of Korea’s “Big 5” hospitals, including Samsung Medical Center, Seoul National University Hospital, Asan Medical Center, and Severance Hospital.Since its inclusion in the national health insurance reimbursement list in October last year, Bylvay has rapidly expanded its prescribing environment.Bylvay is the world’s first oral therapy indicated for the treatment of PFIC-related symptoms. It offers a non-invasive and sustainable treatment option for patients who previously had few alternatives other than high-risk procedures such as liver transplantation.Following its initial approval in the US and Europe in 2021, it has received authorization in major countries. In Korea, it was selected as the first drug under the Ministry of Health and Welfare's ‘Parallel Approval-Evaluation-Negotiation Pilot Program’ in 2023.PFIC is a rare, inherited disease that typically manifests in childhood and causes severe pruritus, growth impairment, and liver failure. Patients and their families endure suffering across all aspects of daily life, including sleep deprivation, interrupted education, and social isolation. Bylvay is a treatment that alleviates this diminished quality of life and opens the possibility for patients to return to their daily routines.Meanwhile, Bylvay demonstrated its efficacy through the Phase III ASSERT study conducted in pediatric and adolescent patients aged 17 years and younger.Study results showed that Bylvay met its primary endpoint by significantly reducing pruritus compared with placebo. It also statistically significantly improved the key secondary endpoint, mean serum bile acid levels at weeks 20 and 24 of treatment, compared to placebo. These therapeutic effects were sustained through 24 weeks of treatment.Professor Seak-hee Oh of the Department of Pediatrics at Asan Medical Center said, “Liver transplantation was a treatment option that had to be chosen as a last resort, despite an average failure rate exceeding 10% and the risk of serious complications. In a situation where there were virtually no alternatives other than transplantation, Bylvay could establish itself as an important alternative that can protect patients without the need for liver transplantation.”
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- Pharmaceutical union joins drug price reform battle
- by Cha, Ji-Hyun Feb 02, 2026 02:16pm
- Tensions surrounding the government’s drug pricing system reform are increasingly shifting from a policy dispute to a matter of employment security. While opposition had previously been led by pharmaceutical industry associations and emergency response committees, labor unions on the ground that are concerned about potential restructuring have now begun to take direct action, significantly heightening the level of tensions. With even foreign-affiliated pharmaceutical sales unions joining the hardline response, observers predict the conflict could escalate into large-scale protests and coordinated collective action.According to industry sources on the 30th, the Korea Democratic Pharmaceutical Unions (KDPU) held a placard protest on the 29th in front of the Health Insurance Review and Assessment Service (HIRA) headquarters in Seocho-gu, Seoul, formally declaring its opposition to the government’s proposed drug pricing reform.The KDPU argued that the policy direction focuses solely on lowering drug prices without sufficiently reflecting the pharmaceutical industry's employment structure and unique characteristics. They also protested, stating that such reforms could lead to job insecurity, a decline in research and development (R&D), and disruptions in the supply of essential medicines.The KDPU is an industry-wide labor union affiliated with the Federation of Korean Chemical Workers' Unions (FKCU) under the Federation of Korean Trade Unions (FKTU). Its membership is largely composed of sales organization employees at multinational pharmaceutical companies, including Allergan, Takeda, Mundipharma, and AbbVie. Kolon Pharmaceutical is the only Korean company included.The KDPU held a picket protest on the 29th in front of the Health Insurance Review and Assessment Service headquarters in Seocho-dong, Seoul, opposing the government's proposed drug pricing system reform plan.This issue was triggered when the government reported a drug pricing system reform plan to the Health Insurance Policy Deliberation Committee last November. The plan proposes lowering the drug pricing calculation standard for generics and off-patent drugs from the current 53% to around 40%.The Ministry of Health and Welfare envisions reducing unnecessary drug expenditure by gradually lowering generic drug prices and adjusting the drug pricing calculation method. It plans to reinvest the secured funds into new drugs and innovative medicines to foster a new drug development ecosystem. In response, the pharmaceutical industry has repeatedly voiced opposition, citing concerns over sharp revenue declines, weakened R&D investment, and instability in the supply of essential medicines.Gi-il Park, chair of the KDPU, whom reporters met at the protest site, cited employment instability as the most critical issue in the government’s proposed reform.Park said, “The pharmaceutical industry already experienced large-scale restructuring at each company during the forced drug price cuts in 2012. For mid-sized and small pharmaceutical firms with limited profit margins, additional price cuts would render restructuring inevitable.”Park also strongly questioned the government's argument that drug price cuts would lead to increased research and development (R&D) investment. He pointed out, “Companies can only increase R&D spending if they generate sales and profits. Forcing drug prices down leaves companies with no choice but to cut costs. Ultimately, drugs that become unprofitable will cease production, potentially leading to disruptions in the supply of essential medicines. Actual stakeholders, like pharmaceutical companies and workers, are excluded from drug pricing policy discussions. A consultative body involving labor, management, government, and experts is necessary.”This marks the first time a pharmaceutical company union has staged a public protest directly targeting the drug pricing system reform.Previously, opposition to the reform had been led primarily by industry associations and emergency response committees. Since the government unveiled the reform proposal, groups such as the Korea Pharmaceutical and Bio-Pharma Manufacturers Association and the Emergency Countermeasure Committee on Drug Pricing Reform have called for revisions and a postponement of implementation through press conferences and official statements.More recently, the center of gravity in the debate has shifted toward the industry’s front lines. On the 22nd, a labor–management forum involving pharmaceutical companies and labor representatives was held at the Hyangnam Pharmaceutical Complex in Hwaseong, Gyeonggi Province. Representatives from the FKCU Pharmaceutical and Cosmetics Division and labor–management delegates from tenant companies jointly called for an end to unilateral drug price cuts.On the 22nd, the Emergency Committee on Drug Pricing Reform for the Development of the Pharmaceutical and Biotech Industry convened a labor–management meeting at the Hyangnam Pharmaceutical Complex in Hwaseong, Gyeonggi Province, urging the suspension of the drug price cut reform.At the forum, labor representatives from the FKCU Pharmaceutical and Cosmetics Division presented numerical estimates warning of an impending “employment shock.” They estimated that if the reform is implemented, annual revenue losses across the pharmaceutical and biotech sector would total KRW 1.2144 trillion, averaging KRW 23.3 billion per company. Operating profits could decline by an average of 52%, potentially wiping out more than half of industry earnings. Such profitability shocks, they argued, would inevitably push companies to prioritize labor cost reductions, leading to restructuring pressure across production, sales, and R&D functions.A contraction in R&D and investment is also expected. The division forecasted that if drug price cuts are implemented, pharmaceutical and biotech companies' R&D expenses would decrease by an average of 25%, and facility investments by 32%. For small and medium-sized pharmaceutical companies, the investment reduction could reach as high as 52%. The subcommittee explained that this investment contraction could directly lead to workforce reductions of 1,691 employees (9%) out of the current 39,170 pharmaceutical industry workers, with mid-sized companies facing workforce reductions of up to 12%.Sang-joon Oh, chair of the Gyeonggi South branch of FKCU, said, “Unstable employment makes it impossible to produce good drugs,” highlighting growing confusion on the ground. Deok-hee Lee, union chair at Ildong Pharmaceutical, warned, “Drug price cuts could ultimately lead to the conversion of regular employees to non-regular status and layoffs, threatening the very survival of the industry.” Given the concentration of small and mid-sized firms in the Hyangnam complex, concerns are mounting that the impact of price cuts could spread to a contraction of the local economy.On the 27th, the Emergency Committee on Drug Pricing Reform for the Development of the Pharmaceutical and Biotech Industry visited the FKTU and met with its president, Dongmyeong Kim. This meeting further underscored the expansion of a joint labor–management response to the reform.On the 27th, the Emergency Committee on Drug Pricing Reform for the Development of the Pharmaceutical and Biotech Industry visited the FKTU and met with its president, Dongmyeong Kim to convey the domestic pharmaceutical and bio-pharmaceutical industry's position and concerns regarding the proposed drug pricing system reform.During the meeting, the emergency committee explained the potential impact of drug pricing reform on industrial competitiveness and employment stability. Both sides agreed that discussions on price cuts should not proceed in isolation from industry and labor considerations, and agreed to maintain close communication and cooperation in future response efforts.Following these labor–management engagements, the labor movement’s response became more explicit. On the same day the KDPU held its protest, the FKTU released an official statement opposing the reform, marking the union’s first official stance at the central level regarding the reform, and the escalation in its level of response.In its statement, the FKTU warned that “an approach aimed at short-term fiscal savings through drug price cuts is a dangerous one that could lead to job insecurity and restructuring. The government should take seriously the lessons of past drug pricing policies, which led to confusion on the ground and weakened the industrial base. The basis for reforming the drug pricing system and its fiscal effects must be transparently disclosed, and a social discussion framework where stakeholders' opinions are substantively reflected must be immediately established.”Observations suggest that if this trend continues, the labor-management conflict surrounding the drug pricing system reform could escalate into a more confrontational phase.The KDPU stated it is reviewing phased countermeasures, including joint responses with the FKCU Pharmaceutical and Cosmetics Division and the FKTU, or additional protests, depending on the progress of future policy discussions and the schedule of the National Health Insurance Policy Deliberation Committee.Should demands for a social consensus mechanism go unmet, the possibility of extreme actions such as collective strikes has also been raised.The FKTU warned, “We will fulfill our responsibility to ensure that the interests of health insurance subscribers and the survival rights of workers are harmoniously reflected in future discussions on drug pricing reform. We will not tolerate any attempt to use this policy as a pretext for deteriorating labor conditions or undermining employment stability.”
- Company
- Sanofi 'deprioritizes' Parkinson's drug ABL301
- by Cha, Ji-Hyun Feb 02, 2026 02:16pm
- The multinational pharmaceutical company Sanofi has adjusted the development priority of a Parkinson’s disease treatment candidate it had licensed from ABL Bio. Regarding the adjustment, ABL Bio stressed that “this does not constitute a suspension of clinical development, nor a termination or cancellation of the licensing agreement.”ABL Bio officially addressed concerns on the 30th regarding the development of ‘ABL301’, a bispecific antibody for treating Parkinson's disease and other neurodegenerative disorders.Previously, on the 29th (local time), Sanofi classified some of its Phase I pipeline assets as “deprioritised” in its fourth-quarter earnings and pipeline update materials. Included in this list was ABL301 (Sanofi code: SAR446159), which ABL Bio licensed out to Sanofi in 2022.Following the news, ABL Bio’s share price opened at KRW 213,500, down about 13% from the previous day’s closing price of KRW 245,500. As of 10:20 a.m., the stock was trading at 207,500 won, down roughly 15% from the prior close.ABL Bio stated that it immediately communicated with Sanofi following the earnings announcement. According to ABL Bio, Sanofi is developing a more meticulous clinical strategy to maximize the clinical success potential of ABL301 amid intensifying competition in the Parkinson's disease treatment development landscape. ABL Bio explained that the specific timeline for subsequent clinical trials has not yet been finalized, which has led Sanofi to use the term “priority adjustment” in its earnings materials.ABL Bio added, “While details of the clinical strategy cannot be disclosed due to competitive considerations, the adjustment is unrelated to ABL Bio’s proprietary platform technology, Grabody-B. Rather, it reflects a strategic approach related to alpha-synuclein, which is considered a potential pathogenic factor of Parkinson’s disease.”The company further added, “Sanofi is still meticulously preparing for the subsequent clinical development of ABL301. Following this clinical strategy will significantly shorten the overall new drug development timeline, enable efficient use of time and resources, and substantially increase the likelihood of success.”ABL Bio repeatedly emphasized that the clinical development of ABL301 has not been halted or terminated. The company stressed, “ABL301 remains a pipeline asset of Sanofi. Sanofi’s commitment to developing ABL301 remains firm, and communication between the two companies is ongoing and active.”
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- Companies prepare measures to cut costs ahead drug price cuts
- by Lee, Seok-Jun Feb 02, 2026 02:16pm
- Warnings of an upcoming drug price cut are shaking pharmaceutical companies from within. Even before the government’s official announcement, internal directives to reduce costs are already being implemented.Some companies have instructed all departments to revise their plans with budget cuts of up to 30%. No division is exempt. R&D, sales, marketing, and HR are all subject to austerity measures. With core departments simultaneously targeted for austerity, tension is rising across the entire organization. Voices are emerging that operations are grinding to a halt.According to industry sources, the atmosphere on the ground has changed dramatically since the government's drug price cut announcement.An executive at a mid-sized pharmaceutical company said, “Because the exact scale of the price cuts has not yet been finalized, companies are acting even more conservatively. Management has decided to assume an immediate revenue decline and prioritize cash preservation.” Another industry insider reported, “With budget execution frozen, discussions on new projects are stalling. Meetings that used to focus on growth strategies have recently shifted to cost control.”The R&D sector is also feeling the impact. New project launches are being put on hold, and external outsourcing contracts are under review. Clinical development plans are being divided into stages or delayed. One R&D executive said, “Approval for long-term projects has become much more difficult. The timing of investments is being recalculated.” Delays in internal approvals are also cited as narrowing the operational flexibility of research teams.Sales and marketing organizations are no exception. Sponsorship of academic conferences and advertising are decreasing, and the scale of promotional material orders is also shrinking. Some companies have effectively halted recruitment plans.The advertising sector is also seeing cases where execution timelines are delayed or contract terms are re-evaluated. A marketing executive stated, “We’ve been instructed to readjust annual advertising budgets. Maintaining brand awareness is important, but cost control is clearly the priority right now.”Sales teams report noticeably slower approval processes. A sales director said, “Sales targets remain unchanged, but support is being reduced. The burden of defending revenue has become heavier. Compared to R&D, the blade is falling more sharply on sales departments.”HR and management support divisions are also included in the austerity drive. Training budgets and welfare benefits are being adjusted, and performance bonus criteria are under further review. Some companies are even discussing the possibility of organizational downsizing. An HR official explained, “Managing fixed costs, including labor expenses, is the top priority. Aggressive investment is difficult until uncertainty is resolved.”The core of the government's proposed reform plan is to lower the pricing benchmark for generic drugs from the current 53.55% of the original drug price to around 40%. While the exact impact will vary by product depending on the detailed implementation method, an adjustment to the unit sales price is inevitable. If the sales base is shaken, it becomes difficult to simultaneously maintain both R&D and sales expenses. This is the background behind some pharmaceutical companies’ preemptive implementation of austerity measures.A sense of crisis is also evident across the industry. Recently, a labor-management meeting was held at the Hyangnam Pharmaceutical Industrial Complex in Hwaseong, Gyeonggi Province, attended by pharmaceutical companies and labor unions. The FKTU’s Pharmaceutical and Cosmetics Division and labor-management representatives of tenant companies urged a halt to the drug price reduction reform.Labor groups presented numerical estimates of the potential shock. If the reform is implemented, annual revenue losses across the pharmaceutical and biotech industry are estimated at KRW 1.2144 trillion, with an average loss of KRW 23.3 billion per company. Operating profits could decline by an average of 52%, according to their analysis. They argue that deteriorating profitability could lead to labor cost reductions and restructuring pressure across production, sales, and R&D personnel.Concerns over contracted R&D and investment were also raised. Implementation of drug price cuts is estimated to reduce R&D expenses by an average of 25% and facility investments by 32%. Analysis suggests investment reductions for small and medium-sized pharmaceutical companies could exceed 50%. A warning followed that approximately 9% of the industry's current workforce of around 39,000 could face layoffs.A senior industry executive stated, “The fact that some pharmaceutical companies have already initiated company-wide austerity measures even before the official announcement demonstrates the intensity of the crisis. Cost reduction is not merely efficiency, it represents a shift in strategic priorities. On the ground, the talk is repeatedly about survival rather than growth. The fact that corporate management stances are already turning conservative internally, even before the drug price cuts are finalized, indicates significant repercussions.”
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- Multinational pharma union 'We oppose drug pricing reform'
- by Son, Hyung Min Jan 30, 2026 11:00am
- On January 29, the Korean Democratic Pharmaceutical Union (KDPU) held a picket protest in front of the Health Insurance Review & Assessment Service (HIRA) in Seocho-dong, Seoul.Both domestic pharmaceutical companies and labor unions of multinational pharmaceutical corporations in Korea have strongly opposed the government's proposed drug pricing reform.The pharmaceutical industry is calling for a reconsideration of the drug pricing reform policy, claiming that the proposal will directly lead to job insecurity, reduced R&D investment, and disruptions in the supply of essential medicines.At 1:00 PM on the 29th, ahead of the Health Insurance Policy Deliberation Committee meeting, the Korean Democratic Pharmaceutical Union (KDPU) held a picket protest in front of the Health Insurance Review & Assessment Service (HIRA) in Seocho-dong, Seoul. The KDPU, an organization composed of labor union members from major multinational pharmaceutical companies, took action to deliver the message about the impact the government's drug pricing reform would have."The nightmare of the 2012 layoff will repeat"The protest site was lined with pickets warning of the policy's impact, featuring slogans such as "If domestic medicine disappears, national health also disappears," "Chasing cheap drug prices leads to limited access to essential medicine," and "Drug price cuts cost the livelihood of workers." The KDPU specifically stated that workers at multinational firms also perceive this drug pricing reform as a direct employment risk.Park Ki-il, Chairman of the KDPU, stated, "The pharmaceutical union was created because of the large-scale restructuring at each company triggered by the 2012 drug price cuts," added, "At that time, companies began downsizing, and even now, the pharmaceutical industry is exposed to the risk of restructuring due to constant drug price reductions. The impact of this reform may be even greater than back then."In particular, Park pointed out that the government is overlooking the structural risk of 'revenue decrease → R&D reduction → cessation of essential medicine production.'Park emphasized, "If the prices of all products are forcibly lowered, revenue will inevitably decrease, and if there is no profit, R&D investment stops." He added, "Companies may give up production of drugs that are not financially viable. This is an issue that could lead to supply disruptions even for essential medicines."Picket protest by the Korean Democratic Pharmaceutical Union (KDPU). He also expressed concern regarding the government's proposed restructuring of the generic drug pricing structure.Park criticized, "If generic drug prices are reduced to around 40%, it will eventually put pressure to lower the prices of original products even further. This is a measure that shakes the profit structure of the entire industry."Furthermore, he stated that the government is interpreting the issue of CSO (sales agency) costs in an excessively simplified manner.Park stated, "Judging that the entire industry is affluent just because some companies spend heavily on CSO costs is an error. We have consistently demanded improvements from companies because such misunderstandings could lead to further drug price cuts."He continued, "Drug price cuts without employment stability measures are a disaster for both workers and the industry. If the government truly cares about public safety, it must completely reconsider the policy."Concerns over large-scale layoffs and weakening industrial competitivenessThe Federation of Korean Chemical Workers' Unions, to which the KDPU belongs, issued a statement on the 15th strongly opposing the government's proposed drug pricing system reform, claiming it fails to adequately reflect the characteristics of the pharmaceutical industry and the realities of labor.The Federation emphasized that the pharmaceutical industry has a high employment-to-revenue ratio and analyzed that if drug price cuts are realized, there is a possibility of approximately 14,000 job losses, centered on research, production, quality, and sales positions.In particular, they pointed out that, given the industry characteristic of fixed costs accounting for a large share, a decrease in revenue can directly lead to workforce reductions and the expansion of irregular positions, making a negative impact on local economies inevitable.The Federation also emphasized that, contrary to the government's goal of creating a new drug development ecosystem, expanding R&D in a situation of decreasing profits is unrealistic.In fact, the net profit margin of the top 100 domestic pharmaceutical companies is only around 3%. If the reform is implemented as initially proposed, an annual revenue decline of up to KRW 3.6 trillion is expected, further reducing the capacity for R&D investment.The Federation demanded that the government ▲reconsider the drug pricing system reform ▲establish a social discussion body in which labor unions participate ▲prepare employment stability measures ▲establish comprehensive measures linked to R&D and strengthening the competitiveness of domestic pharmaceuticals.Picket protest by the Korean Democratic Pharmaceutical Union (KDPU). Park Ki-il (on the right), Chairman of the KDPU, argued for full reconsideration of the drug pricing system reform
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- Will the topical JAKi Anzupgo cream be reimbursed?
- by Eo, Yun-Ho Jan 30, 2026 11:00am
- Interest is growing in the potential inclusion of the topical JAK inhibitor ‘Anzupgo Cream in Korea’s national health insurance reimbursement system.According to industry sources, LEO Pharma Korea’s novel therapy Anzupgo (delgocitinib) for chronic hand eczema (CHE) is expected to be reviewed by the Drug Reimbursement Evaluation Committee (DREC) of the Health Insurance Review and Assessment Service (HIRA) in the first half of this year. LEO Pharma submitted its reimbursement application shortly after receiving Ministry of Food and Drug Safety (MFDS) approval in September last year.It remains to be seen whether this will lead to the introduction of the first reimbursed topical JAK inhibitor in cream formulation in Korea.Anzupgo is the only approved non-steroidal topical cream indicated for the treatment of moderate-to-severe chronic hand eczema in adults who do not respond adequately to topical corticosteroids or for whom such therapies are not appropriate.The product contains no parabens or steroids and exerts its therapeutic effect by inhibiting the JAK-STAT signaling pathway, which plays a key role in multiple inflammatory responses. By suppressing the activity of JAK1, JAK2, JAK3, and TYK2, Anzupgo helps alleviate skin inflammation and pruritus.Until now, treatment options for chronic hand eczema have been limited, primarily relying on potent topical steroids. However, their long-term use carries risks of various side effects, including skin barrier damage, skin atrophy, and telangiectasia.For this reason, when short-term effects are not observed, Korean treatment guidelines recommend combination therapy with topical calcineurin inhibitors or systemic corticosteroids.Currently, the only approved oral treatment for severe chronic hand eczema is GSK’s Alitoc (alitretinoin), which is indicated for patients who do not respond to at least four weeks of intensive topical corticosteroid therapy. It improves symptoms through skin regulation, anti-inflammatory, and immunomodulatory actions. It is known to be effective for long-term management of chronic severe hand eczema with a high risk of recurrence.However, its long-term use is limited by concerns over hepatotoxicity, hypothyroidism, dyslipidemia, and teratogenicity, which restrict sustained treatment.Meanwhile, the efficacy of Anzupgo has been demonstrated in the DELTA FORCE and DELTA 2 clinical trials, which directly compared delgocitinib with GSK’s Alitoc (alitretinoin).In the DELTA FORCE study, delgocitinib demonstrated superiority over alitretinoin capsules when evaluated using the Hand Eczema Severity Index (HECSI) at baseline and Week 12, meeting the primary endpoint.The DELTA 2 trial enrolled 473 patients with moderate-to-severe chronic hand eczema. Participants were randomized to receive either delgocitinib cream or placebo cream, applied twice daily for 16 weeks.The primary endpoint was defined as an Investigator’s Global Assessment for Chronic Hand Eczema (IGA-CHE) score of 0/1 measured at Week 16 of treatment. Key secondary endpoints included IGA-CHE and Hand Eczema Symptom Diary (HESD) scores assessed at Week 4 and 8.Results showed that the delgocitinib group demonstrated statistically significant improvement in chronic hand eczema at Week 16 compared with placebo, successfully meeting both the primary and key secondary endpoints.
