Role of Health Technology Assessment in Drug Policies: Korea

Abstract

South Korea is the first Asian country to mandate the submission of pharmacoeconomic data for reimbursement decision making. For a new drug to be listed, it must demonstrate its value in terms of comparative effectiveness and cost effectiveness. The Health Insurance Review and Assessment Service (HIRA) judges the submitted drug's value and decides whether its coverage is appropriate on the basis of the recommendation of the Pharmaceutical Benefit Coverage Assessment Committee. Once the drug has been accepted by HIRA, the National Health Insurance Service and the sponsoring company negotiate the price and expected sales volume. Even if HIRA acknowledges the value of the drug, it cannot be listed if the negotiation fails. In the off-patent market, generic and original branded drugs are treated equally in terms of pricing. Once generics enter the market, both drug prices should be lowered to 53.55% or less of the on-patent price. Since the current system was implemented, concerns have been raised about a decline in the accessibility of new drugs, especially for high-priced drugs used to treat serious diseases. In 2013, several measures had been introduced aimed at improving the accessibility of these drugs. A risk-sharing scheme and an increase in the maximumacceptable cost-effectiveness ratio were subsequently initiated. Although these schemes have been successful in improving access to high-priced drugs, they are often criticized for reducing transparency in pricing. Finding a balance between accessibility and efficiency is still a challenge in Korea.