"Request to postpone drug price reform"…KPBMA issues resolution

KPBMA board meeting called for an impact assessment on drug price cut

15 new board of directors were appointed…reappointment of Vice Chairman Lee Jae-gook announced

During the board meeting held on February 10, the Korea Pharmaceutical and Bio-Pharma Manufacturers Association (KPBMA ) announced a resolution urging the government to suspend and delay the implementation of its proposed drug pricing reform.

The Korea Pharmaceutical and Bio-Pharma Manufacturers Association (KPBMA ) held the first board meeting of the year on February 10, and unanimously adopted a resolution urging the government to suspend and delay the implementation of its proposed drug pricing reform.

Through its resolution, the KPBMA  Board of Directors urged the government to ▲ delay the vote and implementation of the large-scale drug price reduction plan by the Health Insurance Policy Deliberation Committee ▲an impact assessment on how these cuts would affect public health and employment ▲the abolition of the market-linked actual transaction price implementation plan ▲ support measures to help small and medium-sized pharmaceutical companies upgrade their business structures ▲a formal governance structure between the government and industry to regularly discuss drug pricing policies and industrial growth.

Previously, in November of last year, the Ministry of Health and Welfare reported to the Health Insurance Policy Deliberation Committee a reform plan to drop the price calculation rate for generics and patent-expired drugs from 53.55% to the 40% range. This restructured pricing system is slated for a final vote in February, with implementation following in July.

The board stated, "The industry, which should be fueled with the heat of innovation and challenge, has been thrown into shock by the government's unilateral and rapid push for price cuts centered on domestic prescription drugs," and added, "If the government continues to treat domestic pharmaceuticals merely as tools for cutting the health insurance budget, the industry will face a collapse of its overall foundation, characterized by shrinking R&D investment, reduced facility spending, workforce downsizing, and a weakened supply chain."

Korean pharmaceutical companies are concerned that, if the government's large-scale drug price reductions are enforced, they will be forced to abandon essential long-term research and development (R&D) in favor of short-term survival strategies. This would result in destroying sustainable industry structure and deteriorate industry competitiveness.

The Board of Directors emphasized, "Large-scale drug price reductions would worsen pharmaceutical companies' profitability to an unsustainable level. This would force companies to abandon the production of exit-prevention medicines and low-priced essential drugs, which are indispensable to the public, thereby leading to the loss of the nation's health security foundation."

The board stated, "If our demands are ignored, we will pursue all possible measures to defend health security and national competitiveness, including adopting a petition to the President, making a public appeal to the citizens, and filing legislative petitions."

During the meeting, the board officially appointed the vice-chairman candidates recommended by incoming Chairman Kwon Kibum, who is set to begin his two-year term this March, as originally proposed.

The 15 vice-chairmen who will form the leadership team alongside Chairman Kwon include, ▲​Kim Woo Tae, Chairman of Guju Pharm ▲Yoon Jae-Chu, Vice Chairman of Daewoong ▲Baek In-hwan, President of Daewon Pharmaceutical ▲Jae-hun Jung, CEO of Dong-A ST ▲Kim Jung-gyun, CEO of Boryung ▲Jaeyong Ahn, President of SK Bioscience ▲Son Jee-woong, President of LG Chem Life Sciences ▲Cho Wook-je, President of Yuhan Corporation ▲Yoon Woong-sup, Chairman of Il-dong Pharmaceutical ▲Shin Young-seop, President of JW Pharmaceutical ▲Han Sang-cheol, President of Jeil Pharmaceutical ▲Young-Joo Kim, President of Chong Kun Dang ▲Eun-chul Huh, President of GC Biopharma ▲Park Jae-hyun, President of Hanmi Pharmaceutical ▲Yoon Sung-tae, Chairman of Huons Group.

The board also reappointed three full-time executives whose terms expire at the end of February—Vice Chairman Lee Jae-gook, Senior Managing Director Eum Seung-in, and Managing Director Hong Jung-ki—and appointed Park Ji-man, head of the Public Relations Division, as a new full-time executive (Managing Director).

Additionally, the board approved the recommendations for 48 directors (including the current leadership) and two auditors, which will be submitted as agenda items for the 81st Regular General Assembly on February 24. The general assembly will also address the revised articles of incorporation, the 2025 financial settlement, and the 2026 business plan and budget, all of which were passed during this board meeting.

Chairman Yoon Woong-sup stated "The drug pricing reform currently under discussion is a policy that weakens the R&D investment base and the industry's future competitiveness, and added, "We will focus on creating a policy environment where industrial sustainability and public health improvement can harmonize through a strategic response led by the emergency committee."

KPBMA  President Yunhong Noh stated, "KPBMA  intends to mobilize all means to achieve the goals of leaping forward as a global powerhouse in new drug development and establishing a national health safety net," and concluded, "We ask member companies to continue to support to ensure that all countermeasures are pursued to overcome the current difficulties."