Korea, a dynamic and advanced nation at the forefront of technological innovation, has built an impressive healthcare system based on heavy investment in research and development.

However, despite its thriving medical sector, bringing new drugs into the Korean market presents a myriad of challenges. 

From rigorous regulatory requirements to receiving reimbursement, the process of introducing novel pharmaceuticals in Korea can be challenging for multinational pharmaceutical companies.

Korea Biomedical Review recently spoke with Kang So-young, general manager of AbbVie Korea, where she shared insights into the current landscape of access to innovative medicines in Korea, highlighting the need for policy reforms, the delicate balance between cost-effectiveness and patient access, the excessive use of generics, and the importance of recognizing the value of innovative drugs.

'Reduce health cost for patients'

Starting the interview, Kang expressed her views rebutting some experts’ argument that Korea should increase the proportion of patients’ payment for cancer and rare disease drug reimbursement to ease the state health insurance burden.

"The Korean government often highlights the high proportion of pharmaceutical expenses in the country," Kang said. "However, when examining the composition of pharmaceutical expenses, it becomes evident that no other country in the world has as high a proportion of generic drugs as Korea."

Although protecting the local pharma industry is undoubtedly import, there may be better solutions than just relying on generic drugs, Kang said.

Developing new drugs will ensure the local industry’s long-term advancement, and there should be greater support for medications targeting rare and life-threatening diseases, she added.

According to Kang, Korean patients bear a considerable portion of their medical expenses, with an average of 30 percent, and for many diseases, the burden can reach 50-60 percent. 

In the case of cancer and similar conditions, it hovers around 5-10 percent.

Kang stressed personally she believes that the co-payment of patients should be further decreased rather than increased by reducing hospital visits and excessive medications. 

Kang also discussed the challenges faced by new drugs to receive reimbursement coverage.

"The current process is time-consuming and rigorous, requiring meticulous evaluation before new drugs can receive reimbursement," she said. "To streamline this process and foster innovation, I suggest that the Korean government explores initiatives such as selective coverage based on medical necessity or adaptive pricing strategies."

By embracing flexibility and recognizing the value of innovative medicines, a more favorable environment for introducing breakthrough therapies in Korea can be established, she added.

Looking ahead, Kang expressed hope for healthcare reforms in Korea.

The government recently stressed the significance of a flexible and transparent drug pricing system, she noted. 

"By considering international benchmarks and striking a balance between healthcare budgets and patient access, an enhanced landscape can be fostered."

Additionally, Kang called for a reevaluation of the timeline for recognizing the value of innovative drugs, as the current process often coincides with patent expiration, leading to market challenges.

'One AbbVie' with the merger completion of Allergan

She also discussed the recent completion of the integration process between AbbVie and Allergan in Korea.

While the global merger between the two companies was announced in 2019, the domestic integration process concluded in May.

Kang highlighted the significance of cultural integration and emphasized the efforts made to unify the working styles and values of the two organizations.

Kang further elaborated on the importance of organizational culture and its impact on employee satisfaction and productivity.

Since 2020, AbbVie Korea and Allergan Korea have been working together to align their cultural practices, education programs, employee development initiatives, and volunteer activities, she said. 

"Despite the challenges posed by the Covid-19 pandemic, the companies utilized online platforms to ensure effective communication and collaboration."

As a result, employees already felt a sense of cohesion and unity even before the official completion of the integration, she added.

In March of this year, AbbVie expanded its office space and successfully completed the integration of the Allergan office.

Addressing concerns about the integration of AbbVie and Allergan, Kang acknowledged the differences in their business areas. However, she emphasized the complementary nature of the two companies and the shared focus on innovation.

"While AbbVie is known for its innovative products that transform patients' lives, Allergan brings a dynamic and creative approach to its operations," she said. "The diverse portfolio and different strengths of each company have contributed to a stable and well-rounded organization."

Employees have embraced these differences positively, recognizing the opportunity to apply novel approaches and achieve greater business success, she added.

In terms of the evaluation of AbbVie's Korean branch by the global headquarters, Kang stressed the Korean offshoot receives recognition for its strong performance in the Asian market.

"Historically, Australia has been a significant market, but recently, Korea has been narrowing the gap with Australia," she said. "Access to medicines is crucial for AbbVie, and over the past decade, the access system in Korea has significantly evolved."

The processes and methodologies related to approval and reimbursement have become more transparent, predictable, and rational, she added.

Introduction of innovative medicines in Korea

Kang highlighted the proactive approach of AbbVie in bringing new drugs to market.

"The company has a strong track record of timely coverage and reimbursement, positioning it as a leader in access to innovative therapies," she said. "While challenges persist in the Korean healthcare system, including complex coverage processes and market access issues, AbbVie is committed to ensuring that patients have swift access to breakthrough treatments."

Kang attributed this success to a deep understanding of the access system and a willingness to address policy issues promptly.

Looking to the future, Kang said that with the integration completed, AbbVie aims to leverage the expanded portfolio and diverse therapeutic areas to accelerate growth and innovation.

"The company seeks to maintain a vibrant and collaborative organizational culture, where all employees find joy in their work," she said. "Despite the organization's growth, preserving this positive culture remains a top priority."