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“2012 Pharmaceutical Industry Competitiveness Enhancement Plan” announced in preparation for effectivation of KOR-US FTA, drug price reduction, etc

  • Date : 2012-01-10
  • Hit : 5588

“2012 Pharmaceutical Industry Competitiveness Enhancement Plan” announced in preparation for effectivation of KOR-US FTA, drug price reduction, etc

- Pharmaceutical companies will be re-categorized into three groups; specialized pharmaceutical firms, global generic companies and global major firms and differentiated support for each group will be provided.

In order to advance the domestic pharmaceutical industry facing difficulties due to the effectivation of KOR-US FTA, drug price reduction, etc, differentiated assistance policy for “three global company groups” will be implemented.

Ministry of Health and Welfare (Minister Rim, Chae Min) reported the “2012 Pharmaceutical Industry Competitiveness Enhancement Plan” to secure future competitiveness and normalization of the pharmaceutical industry at the national policy coordination meeting(the joint meeting among related ministries) (at 8:00 in the prime minister’s office) that was held today.

Minister Rim presented a mid and long-term vision and task for realignment of the industrial structure with focus on the innovative pharmaceutical companies and creation of the pharmaceutical ecosystem led by three global pharmaceutical company groups.

(Vision and goal) Ministry of Health and Welfare decided a leap-forward into one of the world’s seven large pharmaceutical power countries by the year of 2020 as a vision.

It also announced a goal of developing 10 global new drugs, of achieving 5.4% of the global export market share and of creating 12 global companies by the year of 2020.

* Global Major Pharma (2) Specialized Pharma (8) Global Generic Pharma (2)

(Strategy and challenge) Ministry of Health and Welfare will set two major strategies and concentrate its intergovernmental capacity and support into those strategies.

First of all, it will designate “innovative pharmaceutical firms” equipped with R&D capacity, promote four major challenges (drug price, tax system, finance, and R&D) and realign the infrastructure.

It will also provide differentiated and customized support to the specialized pharmaceutical company group and global generic company group, ultimately seeking to develop them into global major pharmaceutical firms.

□ Four Major Challenges

Drug price benefit

(i) When the economic feasibility of new drug is conducted (by Health Insurance Review and Assessment Service), the price of alternative (comparable) drug will be maintained at the current level which is before the readjustment of drug prices

(ii) For new drug that shows innovative features, additional drug price rate will be added for a certain period

* New drugs of new mechanism of action, new drugs for which major clinical tests have been conducted in Korea, etc

This will be implemented through related procedures such as reporting to the Health Insurance Policy Review Committee, etc.

Tax System Support

The extents of each tax credit will be extended and adjusted in order to promote the expansion of R&D and facility investments by companies.

Ministry will work with tax authorities to find ways to ease some qualification requirements for tax benefits that are given to companies that are being merged in order to promote M&A among pharmaceutical companies.

Financial Support

Loan support will be expanded for innovative pharmaceutical companies through the Export-Import Bank of Korea, Korea Trade Insurance Corporation, etc (up to 100 billion won along with prime rates).

Benefits will be given within the range of the existing insurance policies such as the “Total Green Industry Insurance,” etc.

Ministry will expand investments in new drug development of innovative pharmaceutical companies utilizing the bio medical fund worth 50 billion won that was re-established in Dec. last year.

Support for New Drug Development R&D

R&D support will be expanded (‘11: 96.4 billion won →’12 :out of 50.5 billion won, 146.9 billion won)

Innovative pharmaceutical companies will be encouraged to first participate in R&D programs of the central administrative organizations including Ministry of Health and Welfare and local governments,

*From 2012, extra points will be given innovative pharmaceutical companies and from 2013, the benefit will be limited to innovative pharmaceutical companies starting with Ministry of Health and Welfare’s programs.

Ministry will consider ways to recognize some expenses such as the cost of the “control group” in clinical tests conducted by innovative pharmaceutical companies as health insurance medical aid.


Establishment of infrastructure to nurture innovative pharmaceutical companies

Ministry will help build the pharma-specialized graduate school(700 million won in 2012, two schools in the second half of the year),

Ministry will help raise up experts in licensing and regulatory affairs (RA), a non-degree course (300 million won in 2012, 300 persons).

It will also carry out a program to dispatch global pharmaceutical experts by strategic export-region (10 persons, 2012).

It will provide an online data portal that offers information on the existing drugs and exports and an offline counseling service by establishing the comprehensive information service center encompassing the entire cycle of new drugs.


Creation and specialization of specialized pharmaceutical companies

Ministry will select 10 specialized future pharmaceutical areas based on market and technologypatterns and trends.

It will expand R&D support for the “consortium by specialized area” with focus on specialized pharmaceutical companies by each area.

* (e.g.) stem cell medicine, rare medicine and antibody medicine, etc

An exclusive sales period will be given to rare drugs and newly developed medicines, etc (e.g. 7 years in US),

It will introduce a system that evaluates and recognizes companies that possess new drug development capacity as “specialized pharmaceutical companies” by 10 different specialized future drug area.


Global Generic Pharma Development and Specialization

Ministry will facilitate the establishment of large scale production facilities and the support for operation fund for them.

*Expansion of fund loan for GMP investments at the advanced level (US, EU) utilizing the export fund for technology development (Bank of Import and Export), Development of Technology Program Fund (Small and Medium Business Administration), Technology Power Evaluation Loan Program (Korea Development Bank)

* Consulting for GMP facility operation and training for operators to secure quality

It will consistently strengthen total service of public facilities.

* Establishment of clinical test/drug production center for high-tech medical complex, enhancement of KBCC operation rate, improvement and entrusted production of GMP facilities and equipment, equipment utilization and enhancement of process, etc

An exclusive sales right in the domestic market for periods of from six months to one year will be given to drugs filed for patent

It will promote specialized strategies such as MOU to streamline the procedures of accreditation for drugs and medicines among governments for new drugs’ advancement into overseas markets such as the middle east and African markets, etc

Lastly, Ministry informed that it will complete the accreditation of “innovative pharmaceutical companies” by April by preparing detailed standards for accreditation of “innovative pharmaceutical companies” and creating the “Pharmaceutical Development and Support Committee (Chair: Minister of Health and Welfare)” by this March.

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