Drug pricing in South Korea

Hye-Young Kwon, Brian Godman

Research output: Contribution to journalArticle

3 Citations (Scopus)

Abstract

Background: Between 2000 and 2013, spending on medicines in Korea increased by 275.3%. In order to curb this trend, several pricing policies and measures were introduced. Objectives: This study reviews these policies and their implications. Methods: Review of pricing regulations as well as a literature review. Results: New medicines must now undergo both a reimbursement assessment and price negotiations. The reimbursement of new medicines is based on their cost-effectiveness. The prices of new medicines are subsequently fixed through negotiations between the payer, the National Health Insurance Service, and the relevant manufacturer. Generic drugs are automatically priced via a new standard methodology. Re-pricing mechanisms were complicated and now redundant. Conclusions: Simple and efficient measures rather than complex and inefficient measures are needed to maintain the value for money principle for new medicines as well as achieve financial efficiency through price competition among multiple s sourced drugs, building on the experiences in other countries.
LanguageEnglish
JournalApplied Health Economics and Health Policy
Early online date30 Jan 2017
DOIs
Publication statusE-pub ahead of print - 30 Jan 2017

Fingerprint

Republic of Korea
Negotiating
National Health Programs
Costs and Cost Analysis
Pharmaceutical Preparations
Generic Drugs
Korea
Cost-Benefit Analysis
South Korea
Medicine
Pricing
Drugs

Keywords

  • price regulations
  • health insurance
  • South Korea
  • generic drugs

Cite this

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title = "Drug pricing in South Korea",
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Drug pricing in South Korea. / Kwon, Hye-Young; Godman, Brian.

In: Applied Health Economics and Health Policy, 30.01.2017.

Research output: Contribution to journalArticle

TY - JOUR

T1 - Drug pricing in South Korea

AU - Kwon, Hye-Young

AU - Godman, Brian

PY - 2017/1/30

Y1 - 2017/1/30

N2 - Background: Between 2000 and 2013, spending on medicines in Korea increased by 275.3%. In order to curb this trend, several pricing policies and measures were introduced. Objectives: This study reviews these policies and their implications. Methods: Review of pricing regulations as well as a literature review. Results: New medicines must now undergo both a reimbursement assessment and price negotiations. The reimbursement of new medicines is based on their cost-effectiveness. The prices of new medicines are subsequently fixed through negotiations between the payer, the National Health Insurance Service, and the relevant manufacturer. Generic drugs are automatically priced via a new standard methodology. Re-pricing mechanisms were complicated and now redundant. Conclusions: Simple and efficient measures rather than complex and inefficient measures are needed to maintain the value for money principle for new medicines as well as achieve financial efficiency through price competition among multiple s sourced drugs, building on the experiences in other countries.

AB - Background: Between 2000 and 2013, spending on medicines in Korea increased by 275.3%. In order to curb this trend, several pricing policies and measures were introduced. Objectives: This study reviews these policies and their implications. Methods: Review of pricing regulations as well as a literature review. Results: New medicines must now undergo both a reimbursement assessment and price negotiations. The reimbursement of new medicines is based on their cost-effectiveness. The prices of new medicines are subsequently fixed through negotiations between the payer, the National Health Insurance Service, and the relevant manufacturer. Generic drugs are automatically priced via a new standard methodology. Re-pricing mechanisms were complicated and now redundant. Conclusions: Simple and efficient measures rather than complex and inefficient measures are needed to maintain the value for money principle for new medicines as well as achieve financial efficiency through price competition among multiple s sourced drugs, building on the experiences in other countries.

KW - price regulations

KW - health insurance

KW - South Korea

KW - generic drugs

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DO - 10.1007/s40258-017-0307-0

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