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- 2026-03-17 11:06:21
- Policy
- AbbVie does not enforce Kaletra’s patent right
- by Lee, Tak-Sun Apr 09, 2020 09:43pm
- AbbVie's HIV-1 treatment AbbVie’s Kaletra (Lopinavir/Ritonavir), which is used in the clinical field as a treatment for COVID-19, has abandoned patent rights, but there is no news of generic development in Korea This is because the market size of AIDS treatment (HIV-1), which is the main indication of Kaletra, is not large in Korea and is already occupied by other new drugs, which is disadvantageous in terms of marketability. However, it is known that some pharmaceutical companies are looking at overseas markets and promoting the development of products for export. According to the industry on the 8th, there are three domestic registered patents for Kaletra, which will expire on August 23, 2024 and February 21, 2026, respectively. AbbVie said it would abandon Kaletra's international patent rights on the 23rd of last month. The company explains that it is a humanitarian measure that allows generic drugs to enhance patient access. In this regard, it is known that AbbVie does not enforce Kaletra’s patent rights in Korea. However, since then, there has been no news of generic development in Korea. In order to obtain a license for a generic item, it is necessary to undergo a bioequivalence test to prove its equivalence with the original, but no test has been approved so far. The industry also expects no pharmaceutical companies to develop generic for Kaletra for the domestic market. Because there is no marketability. This is because the domestic COVID-19 infection situation may improve, and marketability cannot be guaranteed even if a generic drug is made. Domestic AIDS treatment marketing manager said that the domestic AIDS treatment market was not as big as ₩40 billion, and even the original pharmaceutical companies with new drugs such as Gilead, GSK, and AbbVie were in control. He also said that even if a new drug patent for AIDS treatment expires, it is difficult to have generic drugs in Korea. Last year, the domestic sales of Kaletra based on IQVIA were ₩2.4 billion. It is an analysis that it is difficult to expect a big hit in the domestic market. Moreover, the AIDS treatment market has a high preference for originals, so generics have limited market share. However, it is expected that there will be demand overseas. Currently, there are more than 1 million COVID-19 confirmed patients worldwide, and there is a high possibility that the epidemic will continue for a while. As a result, it is known that some domestic pharmaceutical companies with overseas distribution networks are pursuing the approval of Kaletra’s generic for export. The item license for export is judged only through the document screening process, so it can be obtained in a week. However, it must be examined separately in the country of import, which may exceed 1 year until actual export. It has been reported that raw materials are already being supplied in countries such as India. An industry official said that some companies are importing raw materials from overseas to make preparations, and they are aimed at overseas markets rather than domestic markets.
- Policy
- Can generic listing negotiation prevent reckless listing?
- by Kim, Jung-Ju Apr 09, 2020 06:26am
- Although some pharmaceutical companies are voicing their concerns over the generic reimbursement negotiation, to be enforced from the second half of the year, some are actually welcoming the new system with an anticipation of positive benefits. Along with the revised drug pricing system coming in effect around the same time, the generic negotiation is expected to eliminate ‘reckless’ competition among reimbursed drugs in same class. Pharmaceutical industry sources reported on Apr. 6 about the growing voices of the industry claiming the partially revised Regulation on National Health Insurance (NHI) Reimbursement Standard is needed for the amended stepped drug pricing system. The revised Regulation on NHI Reimbursement Standard aims to require drugs receiving automatically calculated reimbursed pricing to negotiate with the government and the insurer to sign an agreement before listing. The Korean government and insurer manage drug pricing with pricing and projected volume negotiation prior to the listing, and with price-volume agreement (PVA) negotiation after the listing. So far, the pre-listing obstacles have been mostly targeting new drug or high-cost drugs only, but soon the generics would have to undergo similar procedure to enhance reimbursement listing value and NHI expenditure efficiency. Reimbursement negotiation does not only regard drug pricing, but also regards supplier’s duty, patient accessibility and financial stability depending on the various pursuing items, which allows healthcare insurance to be utilize more directly to manage active pharmaceutical ingredient’s supply and quality and drug production and distribution. The negotiation for generics with National Health Insurance Service (NHIS) would be completed under 60 days like the new drug reimbursement procedure. The government is currently accepting the industry’s opinion while scheduling the amendments to take an effect from the second half of the year. Nevertheless, the industry has expressed their concerns of the government trying to burden the pharmaceutical companies with excessive liability through unnecessary administrative procedure. And some even complained of the government trying to reinforce pre-listing obstacles and keep pharmaceutical companies on a leash to lower drug pricing. However, contrasting voices have been raised, noticeably. They claim the newly revised stepped pricing system could motivate generics to recklessly apply for reimbursement to be more competitive in the market. Accordingly, other set of regulation to manage the generic pricing system is needed. A pharmaceutical company insider said, “Regardless of their sales plan, some generic products are aggressively applying for reimbursement after their approval. When the stepped pricing system comes in effect, generic makers with actual plan to release the product would unfairly receive pricing close to nothing.” The insider also noted the negotiation with the government and insurer would be able to resolve the loophole issues. Another pharmaceutical industry insider argued “When the reckless listing phenomenon gets more prevalent, pricing of some originals with extremely low marketability could be pressured to drop and they could suspend supplying for the Korean market and cause shortage. Ultimately it could negatively affect patient’s accessibility and treatment, so the government and NHIS should clearly address the subject on the agreement.” Moreover, another pharmaceutical company has mentioned of a reverse discrimination. The company insider said, “The government and the insurer impose duty and liability on original item and its company’s agreement, only because it is a first-in-class. But their competitors, the generic companies, are free of any liability. This is why the question of reverse discrimination has surfaced.” The company insider emphasized, “The government should be considerate of some companies complaining of generic reimbursement negotiation, but also some agreeing on the necessity of the system. Based on the industry’s reaction, hopefully the government and the insurer could reflect their opinions on the system”
- Policy
- GV1001 developed as a demetia drug, approved for COVID-19
- by Lee, Tak-Sun Apr 08, 2020 06:21am
- The Ministry of Food and Drug Safety approved a new drug candidate 'GV1001' by GemVax, which is being developed as a treatment for dementia, for the purpose of treating COVID-19 patients. The request for approval for the use of treatment was made by Kyungpook National University Chilgok Hospital. The MFDS approved the use of GV1001 (Tertomotide HCl), applied by Kyungpook National University Chilgok Hospital on the 3rd, for COVID-19 confirmed patients. Kyungpook National University Chilgok Hospital applied for two cases, and two patients received GV1001. GemVax, which is developing GV1001, said that GV1001 has applied for a patent related to COVID-19. GV1001 is a peptide derived from hTERT (Human Telomerase reverse transcriptase). The enzyme telomerase maintains the length of telomere located at the ends of chromosomes, and the treatment has anti-inflammation, anti-oxidation cellular protective effects, as well as anti-cancer effect. GemVax is currently conducting clinical trials to develop Alzheimer's treatments. GemVax explained that GV1001 proved through preclinical studies to prevent cytokine storms by regulating various inflammatory mediators such as cytokines against severe inflammation caused by COVID-19 infection. The approval for the use of treatment is a system that enables the use of clinical trial drugs for treatment purposes in order to provide treatment opportunities to patients with life-threatening diseases without other means of treatment. In other words, it is different from commercialization clinical trials for product approval for large-scale patients, or sponsor-investigator trials conducted by researchers to prove effectiveness or safety. Approval of use for treatment purposes requested by the hospital is permitted for individual patients, and at the time of application by the company, two or more persons are permitted. Therefore, there is not enough data to demonstrate the effectiveness or safety of the therapeutic use.
- Policy
- Will Rovelito by Handok & Sanofi succeed?
- by Lee, Tak-Sun Apr 07, 2020 06:44am
- Handok & Sanofi-aventis Korea are jointly developing a combination of Irbesartan & Amlodipine, which is antihypertensive drug and are expecting synergy effect between the two companies. Previously, Sanofi-aventis Korea co-developed Rovelito (Irbesartan-Atorvastatin calcium trihydrate), a new combination drug for hypertension/ hyperlipidemia with Hanmi Pharm. Because it was successful in the market through joint promotions, interest is also gathered in this joint development with Handok. In a business report reported to the DART of the Financial Supervisory Service on the 30th of last month, Handok signed a license agreement with Sanofi-aventis Korea for the domestic development, manufacture and licensing of antihypertensive combination drug on October 18 last year. The contract ends on October 17, 2029. The antihypertensive combination drug made by both companies is Aprovasc & CoAprovel. Prior to this, the substance of the combination was revealed through clinical approval from the MFDS on March 4th. It is a combination drug of ARB-based Irbesartan and CCB-based Amlodipine besylate by Sanofi, and a phase II clinical trial will be conducted to confirm efficacy and safety from a total of 440 people this month to March 2021. To date, several ARB-CCB combinations are available, but Irbesartan-Amlodipine combinations are not available. Therefore, it is expected that there will be a prescription merit due to product rarity. In addition, synergies can be doubled if joint marketing is continued between the two companies. Sanofi-aventis Korea has already demonstrated its power through joint marketing of Rovelito with Hanmi Pharm. Rovelito was also a combination drug developed jointly between the two companies. In 2012, the two companies agreed to jointly develop a new drug that combines Irbesartan and Atorvastatin, and acquired an item license in November 2013 under the name 'Rovelito'. Last year's outpatient prescription amount (Source: UBIST) for Rovelito was ₩20.1 billion, and Rovelito pushed out Yuhan's Duo Well (₩18.1 billion/Telmisartan-Rosuvastatin) and Daewoong Pharmaceutical Olostar (₩12 billion /Olmesartan medoxomil/Rosuvastatin) and holds the No. 1 position in the ARB-statin market. In the industry, Rovelito is said to be desirable as a combination of foreign pharmaceutical companies and domestic pharmaceutical companies. Therefore, it is paying attention to whether joint development of Sanofi and Handok will succeed. However, in the case of Rovelito, it was the first product among ARB-statin preparations, so the competition was not severe. The combination of ARB and Amlodipine (including 3 drugs) is not expected to be an easy challenge to the Sanofi-Handok, as there are more than 1,000 licensed products and market competition is fierce.
- Policy
- Samjin’s generic for Forxiga was first approved
- by Lee, Tak-Sun Apr 07, 2020 06:39am
- AstraZeneca’s ForxigaSamjin's SGLT-2 diabetes treatment drug 'Forxiga' was first approved. Unlike Forxiga, it is a product without solvates. Through this, it is expected to avoid the solvate patent and weigh the release around April 2023 when the material patent ends. On the 2nd, the Ministry of Food and Drug Safety approved Samjin Pharmaceutical's Dapazin 10mg (Dapagliflozin), a treatment for diabetes. Dapagliflozin is a key component of AstraZeneca's Forxiga used in type II diabetes treatments. Forxiga is the first SGLT-2 inhibitor that has a mechanism to enhance blood sugar by inhibiting reuptake of glucose from the kidneys and promoting the release of glucose through the urine. In particular, this drug is an insulin-independent mechanism of action and can be used in combination with existing oral blood sugar enhancers because it is not significantly affected by dysfunction of beta cells and insulin resistance. Based on these advantages, the sales performance has been increasing significantly in recent years. Last year's outpatient prescription amounted to ₩31.1 billion, an increase of 13.3% over the previous year. Because it was sold explosively, generic companies for Forxiga also started developing products. However, it is not easy to launch the market early because patents is valid. Accordingly, pharmaceutical companies succeeded in challenging the subsequent patents, except for the material patents, which ended on April 7, 2023. When PMS expired on November 25 of last year, pharmaceutical companies applied for approval the next day. The number of applications for permits reached 16 cases. Of these, Samjin Pharmaceutical was the first to obtain an item license. Unlike Forxiga, Samjin Pharm's licensed product is free of solvates. The original Forxiga has a solvate propanediol hydrate attached to dapagliflozin. It is a strategy of late-breaking drugs to avoid subsequent patents by different solvates. Accordingly, it is expected that the Forxiga solvate-modified drug will be available after April 7, 2023, when the patent for the substance ends.
- Policy
- FDA requests removal of all Ranitidines from the market
- by Lee, Tak-Sun Apr 06, 2020 06:27am
- Ranitidine products collected for recovery As the Food and Drug Administration (FDA) decides to withdraw all products containing Ranitidine on the 1st, domestic pharmaceutical companies seeking to resume sales are embarrassed Until recently, some Ranitidine products were on sale in the US market, so it was expected that if the stability data were submitted in Korea, it would be possible to resume sales sufficiently. However, the FDA also hopes that if a pharmaceutical company demonstrates safety and stability through scientific data, it may consider resuming sales. The FDA said on the 1st that it had requested the manufacturer to collect all of the Ranitidine drugs to withdraw immediately from the market. The FDA has requested voluntary recalls for some lot numbers of Ranitidine. However, in this announcement, it was explained that Ranitidine have increased in carcinogenic substance NDMA (N-nitrosodimethylamine) over time in a general storage environment and recovered in full quantity. This action is similar to the action taken by the MFDS on September 26 of last year. In response to this, an official from the Food and Drug Administration said that there were criticisms that the domestic measures were excessive but the FDA's decision made Korea's preemptive measures reasonable. However, the situation was uncomfortable for companies that were aiming to resume sales of ranitidine formulations. An official from the related company said that the company had been conducting sales resumption through verification that NDMA was not generated even over time, but the FDA's decision will make the MFDS to resume sales more conservatively. Companies that had high sales of Ranitidine formulations expected it would be possible to resume sales. In particular, the U.S. FDA said that the risk of NDMA is not high in Ranitidine formulations, some companies voluntarily recovered it and sold it in the market. Therefore, the prospect was high that the MFDS would allow sales to resume. However, it was analyzed that a more thorough verification was inevitable for the resumption of sales of Ranitidine due to FDA's decision to withdraw. The MFDS has adhered to the principle that, in order to resume sales, manufacturers must prove that NDMA is not produced in the product for a long time. However, the stability period was not specified, and the industry complained of inconvenience. However, some officials from the MFDS have often said that the cause of NDMA production of Ranitidine preparations is a structural problem, and the longer the storage period, the greater the risk, making it difficult to make a decision to resume sales. Nevertheless, manufacturers watched the overseas situation and thought it would be a resumption of sales. Earlier, an official from the company said that the EMA is expected to produce results as soon as possible after the US FDA. and added that if the action of an advanced institution is to expel Ranitidine, it is inevitable to review the sales resumption strategy. On the other hand, there is a response that it is too early to discuss the complete withdrawal because the FDA said that, like the Ministry of Food and Drug Safety, it will allow sales to resume if related companies prove it with scientific data. The FDA responds to this action if the company shows that, through scientific data, their Ranitidine products are stable and that NDMA levels do not increase to an unsafe level over time, the FDA will release the Ranitidine products to the US market. The FDA also added that it did not withdraw its application for commercial approval of Ranitidine. The MFDS also said that there has been no change in relation to the resumption of sales. The MFDS said that no pharmaceutical companies have submitted data regarding the resumption of sales to date.
- Policy
- The first generic for Afinitor & Betmiga will be released
- by Lee, Tak-Sun Apr 06, 2020 06:26am
- Afinitor by NovartisGuangdong Pharmaceutical is licensed for the first generic version of the breast cancer treatment drug Afinitor (Everolimus, Novartis) and is expected to launch this year. In addition, Hanmi Pharm and Chong Kun Dang also received the first generic approval of the overactive bladder treatment drug 'Betmiga' (Mirabegron, Astellas). These products are also expected to be released this year. This is because they all solved the patent problem. The Ministry of Food and Drug Safety (MFDS) approved the product of Everolimus, Erinito 5mg, for breast cancer treatment by Guangdong Pharmaceutical on March 31. This drug is imported from the Chilean pharmaceutical company 'Synthon Chile Ltda.' Earlier, in March of last year, Guangdong Pharmaceuticals was also permitted to receive Erinito 10mg, which has a different dose. The original drug for breast cancer treatment Everolimus is Novartis' Afinitor. Afinitor is a blockbuster drug that raised sales of ₩20.4 billion based on IQVIA last year. It is used not only for breast cancer but also for various cancer diseases such as pancreatic, gastrointestinal tract, neuroendocrine tumor of lung origin, kidney cancer. Guangdong Pharmaceutical has long filed a patent lawsuit with Novartis, a patent holder, to enter Afinitor's first generic market. However, on Jan. 28, Guangdong Pharmaceutical won the patent invalidation trial for the treatment of cancer. In addition to winning the patent lawsuit, Guangdong also obtained generic exclusivity. As a result, Erinito 5mg was recognized for its monopoly in the generic market by December 31st. During this period, no other generic drug can be released. Guangdong Pharmaceutical has a high proportion of OTC businesses such as Ssangwhatang and Vita500, but has recently strengthened its anti-cancer drug business. It is the first time that the generic for Afinitor has obtained an exclusive right by the end of this year, so it is noteworthy whether Guangdong will compete with the original and achieve meaningful results. Meanwhile, on the same day, the first generic version of the sensitization bladder treatment drug 'Betmiga' was also approved. The generics are Chong Kun Dang's ChongKunDang Mirabegron SR 50mg and Hanmi Pharm's Mirabeg SR 50mg. Betmiga is also an ultra-large blockbuster that posted sales of ₩54.6 billion based on IQVIA last year. Many domestic generics have filed an omnidirectional patent lawsuit to enter the market early. As a result, they succeeded in avoiding all other patents (agents) except the material patent that ended on May 3rd. Accordingly, Chong Kun Dang and Hanmi are expected to launch a generic item in July after undergoing a three-month reimbursed procedure. Since Chong Kun Dang and Hanmi are exerting influence in the clinic market through a large-scale sales network, high sales are expected. However, as Astellas is trusted in the urology department, it is unlikely that Hanmi and Chong Kun Dang will be able to take their original share for a short period of time.
- Policy
- Will Hanmi and Chong Kun Dang's generic exclusivity effect?
- by Lee, Tak-Sun Apr 03, 2020 06:35am
- It is noteworthy whether Hanmi Pharm or Chong Kun Dang among the domestic pharmaceutical companies will be able to achieve the performance in the market while acquiring generic exclusivity, which is the most outstanding pharmaceutical company. In particular, attention has been focused on Hanmi and Chong Kun Dang in that there are no successful cases among the products that have obtained a generic drug exclusivity introduced in 2012. Mirabeg SR 50mg Chongkundang Mirabegron SR Tab 50mg On the 1st, the Ministry of Food and Drug Safety designated Hanmi Pharm's 'Mirabeg SR 50mg' and Chong Kun Dang's 'Chongkundang Mirabegron SR Tab 50mg' as generic drug exclusivity. Accordingly, the two products obtained the right to monopolize in the generic market for 9 months from May 4 to February 3 of next year, when the material patent of the original product expires. This is because generic drugs cannot be put on the market during this period. In addition to the two drugs, it was found that there were no products to receive additional generic exclusivity. The Ministry of Food and Drug Safety explained that there are only two products that have obtained a right to generic exclusivity in the Mirabegron, which is used as an overactive bladder treatment. Of course, there were many other pharmaceutical companies that participated in product development and patent litigation aimed at generic exclusivity in addition to Hanmi and Chong Kun Dang. However, it was reported that most of the bioequivalence tests did not prove the equivalence with the original. An official from the related company said that the original product, Betmiga, is a sustained-release preparation in which the drug is slowly released from the body, so that the generic drugs with the same ingredients were found to have difficulty in equivalence. In addition, he said that there are no pharmaceutical companies applying for permission immediately after PMS ends, except Hanmi and Chong Kun Dang. Betmiga's PMS expired on December 30 of last year, and only Hanmi and Chong Kun Dang appear to have submitted the ANDA(Abbreviated New Drug Application) on December 31, the next day. This is the explanation that the first patent challenge, the patent lawsuit win, and the conditions for the first license application are satisfied, and the products of Hanmi and Chong Kun Dang have obtained generic exclusivity. Eleven companies, including Hanmi and Chong Kun Dang, participated in the patent challenge, and the nine companies did not appear to meet the requirements for the initial permit application. As a result, Hanmi and Chong Kun Dang, which are known to have the largest number of salespeople in Korea, gained exclusive rights to the generic market of Betmiga. Hanmi has approximately 1000 salespeople and Chong Kun Dang has approximately 900 salespeople, and both companies have a number of hospitals clients in Korea. Accordingly, it is expected that the market share can be increased as much as possible during the period of monopoly. Betmiga's outpatient prescription last year was ₩54.7 billion. Even if they take 20% of the share of the two pharmaceutical companies, they will be able to exceed the ₩10 billion market. Because Astellas' influence is so great, there are many prospects that even Hanmi and Chong Kun Dang will not be easily taken away. This was also seen in the case of Vesicare (Solifenacin), an irritable bladder treatment in 2017. Ahn-gook Pharm and Hanmi Pharm, which have salt-changing products, succeeded in avoiding patent expiration and came out 7 months and 3 months before generics, respectively, but were insufficient to threaten the original. Looking at the outpatient prescription amount (Source: UBIST) last year, Ahngook's A-Care was promoted to ₩3 billion and Hanmi’s Besigum amounted to ₩2.1 billion, but it was less than Vesicare’s ₩13.4 billion. Nonetheless, the two pharmaceutical companies are expecting 9 months of monopoly. An official of the related company said that although there is a patent appeal with the original company, it is expected to enforce the launch because it has obtained generic exclusivity and it is expected to monopolize the market once there is no representative generic drug itself. Meanwhile, so far, 328 generics have won generic exclusivity. However, no case has ever grown into a large-sized product that exceeds ₩10 billion annually. This is analyzed because there are many products from the same ingredient, and because of illegal marketing regulation, it is not able to exert the sales power of generic drugs as before.
- Policy
- Rumor: Chief Yang as new Pharmaceutical Benefits Director
- by Kim, Jung-Ju Apr 03, 2020 06:33am
- Apparently, a rumor is circulating about the new director of Pharmaceutical Benefits Division at Ministry of Health and Welfare (MOHW), who would lead the Moon Jae-in Care-initiated drug pricing system revision. According to pharmaceutical industry sources on Mar. 31, Chief Yang Yoon Seok of Smart Healthcare Regulation Revision Planning Team (Graduated from Department of Consumer Science and Child Development Family Studies at Seoul National University) is speculated as a new director of Pharmaceutical Benefits Division and take over the major tasks on MOHW’s pharmaceutical insurance benefit policies. Within the welfare sector of the ministry, Chief Yang used to serve at Aging Society Policy Division and Division of Basic Livelihood Security, and in the health sector, he served at Healthcare Policy Division and as a Chief of Primary Healthcare Improvement Team. In 2014, he participated in talks between the government and medical organization about remote medicine. Then after, he has served as an Administrator of Health and Welfare at the Cheong Wae Dae and a Director of National Pension Finance Division back in MOHW. Even a month after former Director of Pharmaceutical Benefits Division, Kwak Myeong-seop, was transferred in February, the position is still vacant and the division is proceeding with the pharmaceutical policies slowly, but steadily. Although Lee Seon-joo has been newly appointed as a Senior Deputy Director, she was temporarily transferred to COVID-19 response team. Concerns of overloaded work on two deputy directors of the division have been raised internally and externally, but the industry is patiently waiting for the MOHW’s regular personnel changes to be announced amid the outbreak. The government is committed to base the groundbreaking coverage enhancement initiative Moon Care to provide better accessibility on high-cost drugs and to manage listed drugs. Accordingly, the industry expects an official willing to firmly press on with the policy projects would be appointed. And considering all planned initiatives, MOHW has internally agreed on selecting a well-experienced director from other division as the next Director of Pharmaceutical Benefits Division. In other words, the ministry would not gamble on promoting an inexperienced official as the new director. MOHW would likely to finalize the new Director of Pharmaceutical Benefits Division and announce the successor this week at earliest. Meanwhile, former Director Kwak Myeong-seop was dispatched to the South Korea Consulate in Guangzhou, China.
- Policy
- New drug reimbursement review costs KRW 39 million
- by Lee, Hye-Kyung Apr 02, 2020 06:26am
- Experts recommend the Korean government should review implementing service fee system for reimbursement review to enhance speed and efficiency of pharmaceutical reimbursement listing procedure, and to provide quality service through sufficient financial and human resources. While the Health Insurance Review and Assessment Service (HIRA) does not currently collect service fee for the insurance reimbursement listing procedure, a study claims the reimbursement review costs about 39 million won. According to the HIRA’s cosigned research on ‘Appropriate Service Fee for NHI Pharmaceutical Reimbursement Listing Procedure (Principle Investigator: Lee Sang-Hoon at Korea Productivity Center (KPC))’ on Apr. 1, government bodies of Australia, Canada, Switzerland, the U.K., Japan and many other countries are charging for the pharmaceutical listing service. Specifically for reviewing new drug, the service charge apparently goes up over 100 million won. In Korea, the pharmaceutical reimbursement listing is dealt by New Drug Listing Division under the Pharmaceutical Benefit Department at HIRA, and the subject for reimbursed pricing is selected by Drug Pricing Calculation Division. And other additional support is provided by the Pharmaceutical Management Division. The research team surveyed HIRA organization and human resource capacity to calculate the cost of reimbursement review and deduced that each case of review would cost 39 million won, based on the salary class (last three years) of 17 officials in Pharmaceutical Management Division, 28 officials in New Drug Listing Division, 21 officials in Drug Pricing Calculation Division and 32 officials in Pharmaceutical Benefit Standard Division. The researchers explained, “The implementation of service fee system could be justified through the principles of specialty (compensation for the service provided by a specialized individual), the principles of expense compensation (compensation for the cost of time and physical expense spent on an individual’s benefit) and the principles of beneficiary (compensation for the financial profit provided through administrative service).” As for the administration service fee systems in Korea, HIRA charges service fee for pharmaceutical distribution information and big data provision, which comes down to basic salary of fourth level government officials and five percent of general maintenance fee. Ministry of Food and Drug Safety’s (MFDS) pharmaceutical approval service fee has not been changed since 2008. But it would be raised before July 2020, followed by a raise in 2016 based on a cosigned research outcome. Although the 2016 research has assessed and suggested an adequate service fee, 60 percent of the suggested fee was reflected. The research team stated, “The deduced cost of a new drug review case in Korea is expensive at approximately 39 million won, however, it would be not be considered excessively high compared to other countries,” regardless, “the public may be resistant to the system implementation, so the service fee should be set under the prime cost, taking in account the generated public benefit.” At the initial phase of the system implementation, the researchers recommended the government to introduce the system by charging basic administration fee and gradually increasing the fee to avoid clash with pharmaceutical companies. The researchers also emphasized, “However, the possibility of gradual increase of service fee is very low and charging the basic administration fee only could become permanent. As the service fee gap between new drug and other drugs is significantly big that charging the basic fee could be as meaningless as not charging any fee at all.” The study concluded the government should prioritize assessing the actual cost based on the current operation system to accurately deduce appropriate service fee.
