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Drug Pricing in South Korea

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Abstract

Between 2000 and 2013, spending on medicines in Korea increased by 275.3%. In order to curb this trend, several pricing policies and measures were introduced. This study reviews these policies and their implications based on pricing regulations as well as a literature review. New medicines now undergo both a reimbursement assessment and price negotiations. The reimbursement of new medicines is based on their cost effectiveness. The prices of new medicines are subsequently fixed through negotiations between the payer, the National Health Insurance Service, and the relevant manufacturer. Generic drugs are automatically priced via a new standard methodology. Repricing mechanisms were complicated and now redundant. Simple and efficient measures rather than complex and inefficient measures are needed to maintain the value-for-money principle for new medicines as well as achieve financial efficiency through price competition among generic drugs.

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Author contributions

HYK jointly conceived the study with BG. HYK designed and collected data. HYK and BG prepared the first and successive manuscripts.

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Authors and Affiliations

  1. Mokwon University, 88 Doan-bukro, Seo-gu, Daejeon, Republic of Korea

    Hye-Young Kwon Ph.D

  2. Department of Laboratory Medicine, Division of Clinical Pharmacology, Karolinska Institutet, Karolinska University Hospital Huddinge, SE-141 86, Stockholm, Sweden

    Brian Godman Ph.D

  3. Strathclyde Institute of Pharmacy & Biomedical Sciences, University of Strathclyde, Glasgow, UK

    Brian Godman Ph.D

Authors
  1. Hye-Young Kwon Ph.D
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  2. Brian Godman Ph.D
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Correspondence to Hye-Young Kwon Ph.D.

Ethics declarations

This study is self-funded. Hye-Young Kwon and Brian Godman declared no conflicts of interest. The authors would like to express their deepest appreciation to Professor Bong-Min Yang from Seoul National University for his advice when developing the draft manuscript.

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Kwon, HY., Godman, B. Drug Pricing in South Korea. Appl Health Econ Health Policy 15, 447–453 (2017). https://doi.org/10.1007/s40258-017-0307-0

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