South Korea's government is beginning a sweeping restructuring of the domestic pharmaceutical industry, aiming to shift its foundation from generic drugs toward innovation and exports. The government plans to build a growth ladder that nurtures drugmakers in stages based on their research and development spending, and to prepare an improvement plan by November covering the entire industry — from preferential drug pricing and certification of innovative pharmaceutical companies to restructuring the generic drug sector, tighter oversight of contract sales organizations (CSOs) and artificial intelligence-driven drug discovery.
The Ministry of Health and Welfare said it launched the first Public-Private Council for Pharmaceutical Industry Innovation and held its inaugural meeting on the 2nd at the Koreana Hotel in Seoul, with participants from relevant ministries, the pharmaceutical industry, academia and public agencies.
The council has 21 members and is co-chaired by Lee Hyung-hoon, second vice minister of health and welfare, and Noh Yeon-hong, chairman of the Korea Pharmaceutical and Bio-Pharma Manufacturers Association. What distinguishes the body is that the government will discuss major policies at a single table with the goal of strengthening industry competitiveness, rather than addressing individual pharmaceutical issues separately.
The agenda is broad. Key items include nurturing innovative and semi-innovative pharmaceutical companies, strengthening supervision of CSOs, helping generic-focused firms achieve scale and specialization and turn to exports, promoting the development of biologic drugs, incrementally modified drugs and botanical drugs, and applying AI to drug discovery and manufacturing innovation.
Based on the council's work, the government plans to flesh out a growth ladder for drugmakers. Promising small and medium-sized companies and venture firms that invest above a certain level in R&D will be designated semi-innovative pharmaceutical companies, creating a step-by-step development system running from startups to semi-innovative companies, then to innovative pharmaceutical companies and finally to global-scale drugmakers.
The council will meet once a month. The government aims to concentrate discussions over about three months and prepare a comprehensive plan to strengthen the pharmaceutical industry's competitiveness by November.
"We hope to share the current state of Korea's pharmaceutical industry and, through intense discussion, set a direction for nurturing and developing an industry that will drive the country's future growth," Lee said.
"We hope the views presented by pharmaceutical and bio companies will be fully reflected, providing an opportunity for the entire pharmaceutical and bio industry ecosystem, including R&D and product manufacturing, to advance," Noh said.
