Korea Reforms Health Insurance Policy, Tightens Funding for Multinational Drug Companies
23 Jun 2006
The Korean government is planning to establish a “positive list” of drugs that will be covered by its national health insurance system. Only those pharmaceuticals proven to be effective and competitively priced will be included; drugs deemed too expensive or of questionable therapeutic value will not.
Multinational drug companies argue that the Korean policy hampers access of recently-commercialized drugs to Korean patients and that this policy might discourage the funding and development of new drugs. However, the Korean Federation of Medical Groups for Health Rights (KFHR) has countered that the list will represent an effective system to reduce the rising costs of pharmaceuticals, and has stated that drug companies are exploiting the current drug pricing policy to gain high profits while disregarding patient health.
Many brand-name drugs are manufactured using patented technologies; patent fees contribute to the price discrepancy between brand-name and generic drugs. Generics can be manufactured at a much lower cost to patients only after a patent expires. Multinational drug companies would like to extend the period covering their patents, during which they retain exclusive rights to making and selling their products.
Source: Ah-young, C. New drug policy angers multinationals. The Korea Times. June 15, 2006.
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