Government support will be strengthened for essential medicines that are indispensable for patient care but have raised concerns about production being halted due to low profitability. The plan is to raise the price benchmarks by up to about 10% and apply additional add-ons for drugmakers that supply stably to induce production of essential medicines.
On the 16th, the Ministry of Health and Welfare issued an advance notice of a partial amendment to the notice on criteria for the determination and adjustment of drug prices reflecting these details. The government will raise by about 10% the threshold for designating exit-prevention medicines to reflect rising production costs and will also improve the designation process and price compensation method.
By dosage form, oral solid preparations in pill form were raised from 525 won to 578 won, and oral liquid preparations for drinking were raised from 40 won to 44 won per minimum unit. Topical preparations were adjusted from 2,800 won to 3,080 won, and injectables from 5,257 won to 5,783 won.
The designation process will also become more flexible. Going forward, when seeking to designate national essential medicines as exit-prevention medicines, materials may be submitted at any time with recommendations from relevant organizations. Ingredients and dosage forms included in World Health Organization (WHO) essential medicines or national essential medicines will be given priority review.
A basis was also established for government ex officio designation to ensure the supply of essential drugs is not cut off during national crises such as the spread of infectious diseases or natural disasters. If supply shortages or sharp price increases occur, the Minister of the Ministry of Health and Welfare may designate the drug as an exit-prevention medicine.
Incentives were newly established for drugmakers that supply stably. Corporations that have produced exit-prevention medicines without supply interruptions over the past three years will be subject to a 3% add-on rate. Seven items, including whether the drug is a national essential medicine and the use of domestically produced raw materials, may each receive an additional 1% add-on.
Administrative burdens on small-volume items will also be eased. The threshold for simplified cost-calculation procedures will be expanded from less than 1 billion won in annual claims to less than 5 billion won.
The amended notice will take effect on Aug. 1.