KHIDI expert calls for drug supply chain reform in Korea

As global powers including the U.S., EU, Japan, and China step up efforts to localize and secure pharmaceutical supply chains, a Korean expert warned that Korea is lagging behind in establishing a comprehensive system to address similar vulnerabilities.

Jung Soon-kyu, principal investigator of the pharmaceutical and biotech industry team at the Korea Health Industry Development Institute (KHIDI), recently wrote a policy contribution article in Science & ICT Policy and Technology Trends, a journal by the Korea Institute of Science and Technology Evaluation and Planning (KISTEP).

Jung highlighted the urgent need for Korea to establish a more comprehensive and resilient pharmaceutical supply chain strategy.

“Major countries are treating pharmaceutical supply chain stability as a matter of national security,” Jung wrote. “Yet Korea’s efforts remain fragmented, with limited support for raw material localization, infrastructure expansion, or long-term manufacturing resilience.”

According to Jung, pharmaceutical supply chains face increasingly complex risks, including disruptions in the supply of active pharmaceutical ingredients (APIs), clinical trial delays, production bottlenecks, quality issues, and geopolitical instability.

The Covid-19 pandemic was a stark reminder of how global disruptions can trigger national medicine shortages, prompting countries to strengthen their systems.

The U.S. enacted the CARES Act in 2020, requiring pharmaceutical manufacturers to report supply chain data to the FDA and directing federal agencies to prioritize domestically produced essential medicines.

This was followed by a series of executive orders aimed at boosting U.S. biomanufacturing and reducing dependence on foreign APIs.

In 2023, the former Joe Biden administration unveiled bold goals to accelerate continuous manufacturing and cut advanced drug production costs by 90 percent within 20 years.

The EU, through the Pharmaceutical Strategy for Europe and the proposed Critical Medicines Act, has also introduced aggressive measures to localize production, enhance regulatory agility, and build a strategic stockpile of critical drugs.

The Health Emergency Response Authority (HERA) was created to coordinate emergency preparedness and supply chain monitoring across member states.

Meanwhile, Japan passed its Economic Security Promotion Act in 2022, funding antibiotic self-sufficiency and resilient manufacturing capacity. The government is also building dual-use bioproduction facilities that can shift to vaccine manufacturing during pandemics.

China, a dominant API exporter, is pursuing advanced biomanufacturing as a national priority under its 14th Five-Year Plan, while India is scaling up API self-sufficiency through production-linked incentives and bulk drug parks.

In contrast, according to Jung, Korea continues to depend heavily on imported raw materials, with a low self-sufficiency rate in APIs and recurring shortages of essential drugs.

From 2020 to 2023, 46 drugs were withdrawn from the market due to supply issues, and as of April 2023, 490 products including 95 essential items—69 of which were manufactured in Korea faced unstable supply.

Jung emphasized that Korea must adopt both internal and external strategies—strengthening domestic production capacity, building digital traceability systems, and diversifying sourcing through international partnerships.

“The ability to collect and analyze high-quality, accurate data rapidly is becoming more critical,” he said. “As a result, there is a need for government-led initiative to support Korean companies in expanding technology licensing deals with U.S. firms, exporting pharmaceutical ingredients, securing contract manufacturing agreements, and acquiring overseas production facilities.”

He also called for the creation of a national “Pharmaceutical Supply Chain Map” and the enactment of a new legislative framework, the tentatively named Pharmaceutical and Biotech Supply Stabilization Act.

“The proposed framework should integrate real-time monitoring, big data analytics, AI-driven risk prediction, and blockchain technologies to strengthen crisis response,” Jung said. “Korea’s strong ICT foundation gives it a competitive edge, but we must act now to transform that into supply chain security.”

Jung concluded that without long-term planning and legislative support, Korea risks falling behind global standards, particularly as upcoming regulations and tariffs reshape the pharmaceutical trade. “With at least five years of sustained policy support,” he noted, “we can prevent future drug shortages and secure access to essential treatments by 2030.”