South Korean govt to slash drug prices 14%

South Korea’s Ministry of Health and Welfare has issued an advance notice of the legislation of detailed regulations to reform the drug-pricing system, which includes proposals to cut the prices of a wide range of pharmaceutical products by an average of 14%.

The price cuts, if approved by the Prime Minister’s Office in December, will be the largest since the government took away drug sales rights from doctors and gave them exclusively to pharmacists in 1999, notes the local Korea Herald. However, the new plan is not quite as draconian as had been expected earlier this year, when the government revealed plans to cut drug prices by an average of 17% starting in 2012 as part of its efforts to reduce excessive medical outlays that have become a social burden and to make savings of some 2,100 billion won ($1.89 billion; The Pharma Letter August 15).

Drug price reductions in total affected by the new drug-pricing policy are estimated to be 1,700 billion won (1,200 billion won from health insurance and 500 billion won paid by individuals, the Ministry noted.