A court dismissed local drugmakers’ appeal to nullify the government’s push to negotiate the recollection of health insurance coverage for choline alfoscerate (CA).
The Ministry of Health and Welfare said the Seoul Administrative Court ruled in favor of the ministry on Friday.
The ruling was against 27 pharmaceutical companies that filed administrative suits that claimed that the government’s order to re-negotiate the collection of the health insurance for CA was unfair.
In June 2020, the Ministry of Food and Drug Safety decided to re-assess the clinical usefulness of CA, a cognition improvement drug.
After the decision, the health and welfare ministry pushed for two-time negotiations between the National Health Insurance Service and pharmaceutical companies over the content, “the government would recollect the health insurance paid during the re-evaluation period to save health insurance financial losses in case the drug fails to pass the re-assessment.”
Protesting the government’s idea, local drugmakers represented by Daewoong Bio and Chong Kun Dang filed two lawsuits to stop the ministry’s order for negotiations and cancel the administrative order.
However, the court dismissed the drugmakers' appeal in both of the first trials against the first negotiation order.
On Jan. 13, the court rejected Daewoong Bio’s request to stop the administrative order on negotiations. On Feb. 4, it also dismissed Chong Kun Dang’s appeal to nullify the ministry’s order on negotiations for recollection of health insurance.
Since last year, some companies, including Daewoong Pharmaceutical, Hanmi Pharmaceutical, and Yuhan Corp., have voluntarily withdrawn from the suit, participating in the negotiations or lowering the drug price.
In the suit against the second negotiation, 24 out of 26 plaintiffs, including Daewoong Bio, withdrew the suit. As a result, only two companies – Whanin Pharm and CMG Pharm – are the remaining plaintiffs.
Separately from the suit over the negotiation order, the health and welfare ministry said it would actively respond to a lawsuit seeking nullification of the reimbursement reduction for CA following the re-evaluation.
To cancel the government’s plan to reduce health insurance coverage for CA, 78 drug companies represented by Daewoong Bio and Chong Kun Dang have requested the court to stop and cancel the plan.
The pharmaceutical companies argued that it was illegal to make CA, an authorized drug, selectively reimbursable. Plus, the efficacy of CA has been verified through long-term use by clinicians, they said.
However, the health and welfare ministry said it was possible to reimburse CA selectively as a type of health insurance coverage, and the agent lacked literature to prove its clinical usefulness.