The Ministry of Health and Welfare has promised to prioritize drug prices of companies that create social value through job creation and investment in clinical research, regardless of whether they are Korean or multinational.

Lee Jung-kyu, director-general of the ministry's Health Insurance Policy Bureau, said this at a recent meeting with journalists to explain the direction of improving the drug price system.

On March 21, Vice Minister of Health and Welfare Park Min-soo made similar points while briefing the strategy and key issues for this year's drug price policy at a meeting with CEOs of biopharmaceutical companies hosted by the Korean Pharmaceutical and Bio-Pharma Manufacturers Association. 

Vice Minister Park said, “The government will promote drug price policy from a comprehensive and balanced perspective, induce the creation of an innovation ecosystem that invests in new drug development, and establish a drug price system for companies that create social value such as supplying essential drugs.”

Director-General Lee explained the meaning of creating social value at a recent meeting.

“We are considering preferential drug prices for domestic or multinational companies that create social value by, for instance, creating jobs, investing in clinical research, and registering innovative new drugs,” he said. 

Lee continued, “We believe that if the government prioritizes specific companies’ drug prices, they will reinvest it, hire more people, conduct more R&D, and orient the policy in a direction that can create such a virtuous cycle.”

Besides, the ministry will consider resolving instability in the supply of essential drugs and integrating a drug price follow-up system.

“Since the supply of essential drugs sometimes becomes unstable, we are also considering preferential drug prices and strengthening supply obligations to stabilize the supply of essential drugs, and are also looking into an integrated drug price follow-up system,” Lee said.

Lee added that the ministry also believes that some problems, like drugs that increase their prices (due to low profitability) and later become subject to follow-up management, must be improved.