IDEAS home Printed from https://ideas.repec.org/a/spr/aphecp/v15y2017i4d10.1007_s40258-017-0307-0.html
   My bibliography  Save this article

Drug Pricing in South Korea

Author

Listed:
  • Hye-Young Kwon

    (Mokwon University)

  • Brian Godman

    (Karolinska Institutet, Karolinska University Hospital Huddinge
    University of Strathclyde)

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.

Suggested Citation

  • Hye-Young Kwon & Brian Godman, 2017. "Drug Pricing in South Korea," Applied Health Economics and Health Policy, Springer, vol. 15(4), pages 447-453, August.
    • Handle: RePEc:spr:aphecp:v:15:y:2017:i:4:d:10.1007_s40258-017-0307-0
    DOI: 10.1007/s40258-017-0307-0
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s40258-017-0307-0
    File Function: Abstract
    Download Restriction: Access to the full text of the articles in this series is restricted.
    File URL: https://libkey.io/10.1007/s40258-017-0307-0?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Bae, Eun-Young & Hong, Ji-Min & Kwon, Hye-Young & Jang, Suhyun & Lee, Hye-Jae & Bae, SeungJin & Yang, Bong-Min, 2016. "Eight-year experience of using HTA in drug reimbursement: South Korea," Health Policy, Elsevier, vol. 120(6), pages 612-620.
    2. Bonny Parkinson & Catherine Sermet & Fiona Clement & Steffan Crausaz & Brian Godman & Sarah Garner & Moni Choudhury & Sallie-Anne Pearson & Rosalie Viney & Ruth Lopert & Adam Elshaug, 2015. "Disinvestment and Value-Based Purchasing Strategies for Pharmaceuticals: An International Review," PharmacoEconomics, Springer, vol. 33(9), pages 905-924, September.
    3. Su-Yeon Yu & Bong-Min Yang & Jin-Hyun Kim, 2013. "New Anti-Rebate Legislation in South Korea," Applied Health Economics and Health Policy, Springer, vol. 11(4), pages 311-318, August.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Amarawan Pentrakan & Cheng-Chia Yang & Wing-Keung Wong, 2021. "How Well Does a Sequential Minimal Optimization Model Perform in Predicting Medicine Prices for Procurement System?," IJERPH, MDPI, vol. 18(11), pages 1-17, May.
    2. Kwon, Hye-Young & Bae, Seungjin & Choi, Sang-eun & Park, Sylvia & Lee, Eui-Kyung & Park, Sungmin & Kim, Jinhyun, 2019. "Easy cuts, easy rebound: Drug expenditures with massive price cuts in Korea," Health Policy, Elsevier, vol. 123(4), pages 388-392.
    3. Mingyue Zhao & Lingyi Zhang & Zhitong Feng & Yu Fang, 2021. "Physicians’ Knowledge, Attitude and Practice of Generic Substitution in China: A Cross-Sectional Online Survey," IJERPH, MDPI, vol. 18(15), pages 1-13, July.
    4. Kwon, Hye-Young & Kim, Jinhyun, 2020. "Consistency of new drug pricing in Korea: Bridging variations among personnel in price negotiations," Health Policy, Elsevier, vol. 124(9), pages 965-970.
    5. Yan Sun & Zheng Zhu & Jiawei Zhang & Peien Han & Yu Qi & Xiaoyang Wang & Li Yang, 2022. "Impacts of National Drug Price Negotiation on Expenditure, Volume, and Availability of Targeted Anti-Cancer Drugs in China: An Interrupted Time Series Analysis," IJERPH, MDPI, vol. 19(8), pages 1-10, April.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Sabine Vogler & Valérie Paris & Alessandra Ferrario & Veronika J. Wirtz & Kees Joncheere & Peter Schneider & Hanne Bak Pedersen & Guillaume Dedet & Zaheer-Ud-Din Babar, 2017. "How Can Pricing and Reimbursement Policies Improve Affordable Access to Medicines? Lessons Learned from European Countries," Applied Health Economics and Health Policy, Springer, vol. 15(3), pages 307-321, June.
    2. Angelo Claudio Palozzo & Andrea Messori, 2016. "Comment on: “Disinvestment and Value-Based Purchasing Strategies for Pharmaceuticals: An International Review”," PharmacoEconomics, Springer, vol. 34(4), pages 419-420, April.
    3. Lei Chen & Ying Yang & Mi Luo & Borui Hu & Shicheng Yin & Zongfu Mao, 2020. "The Impacts of National Centralized Drug Procurement Policy on Drug Utilization and Drug Expenditures: The Case of Shenzhen, China," IJERPH, MDPI, vol. 17(24), pages 1-11, December.
    4. Peter Ghijben & Dennis Petrie & Silva Zavarsek & Gang Chen & Emily Lancsar, 2021. "Healthcare Funding Decisions and Real-World Benefits: Reducing Bias by Matching Untreated Patients," PharmacoEconomics, Springer, vol. 39(7), pages 741-756, July.
    5. Seung-Lai Yoo & Dae-Jung Kim & Seung-Mi Lee & Won-Gu Kang & Sang-Yoon Kim & Jong Hyuk Lee & Dong-Churl Suh, 2019. "Improving Patient Access to New Drugs in South Korea: Evaluation of the National Drug Formulary System," IJERPH, MDPI, vol. 16(2), pages 1-15, January.
    6. Kyung-Bok Son, 2018. "Understanding the adoption of new drugs decided by several stakeholders in the South Korean market: a nonparametric event history analysis," Health Economics Review, Springer, vol. 8(1), pages 1-10, December.
    7. Sabine Vogler & Peter Schneider & Nina Zimmermann, 2019. "Evolution of Average European Medicine Prices: Implications for the Methodology of External Price Referencing," PharmacoEconomics - Open, Springer, vol. 3(3), pages 303-309, September.
    8. Eun-Young Bae & Hui Jeong Kim & Hye-Jae Lee & Junho Jang & Seung Min Lee & Yunkyung Jung & Nari Yoon & Tae Kyung Kim & Kookhee Kim & Bong-Min Yang, 2018. "Role of economic evidence in coverage decision-making in South Korea," PLOS ONE, Public Library of Science, vol. 13(10), pages 1-12, October.
    9. Cho, Mee-Hyun & Yoo, Ki-Bong & Lee, Hoo-Yeon & Lee, Kwang-Sig & Kwon, Jeoung A & Han, Kyu-Tae & Kim, Jae-Hyun & Park, Eun-Cheol, 2015. "The effect of new drug pricing systems and new reimbursement guidelines on pharmaceutical expenditures and prescribing behavior among hypertensive patients in Korea," Health Policy, Elsevier, vol. 119(5), pages 604-611.
    10. Karin Dam Petersen & Gang Chen & Christine Mpundu-Kaambwa & Katherine Stevens & John Brazier & Julie Ratcliffe, 2018. "Measuring Health-Related Quality of Life in Adolescent Populations: An Empirical Comparison of the CHU9D and the PedsQLTM 4.0 Short Form 15," The Patient: Patient-Centered Outcomes Research, Springer;International Academy of Health Preference Research, vol. 11(1), pages 29-37, February.
    11. Bae, Eun-Young & Lim, Min Kyoung & Lee, Boram & Bae, Green, 2020. "Who should be given priority for public funding?," Health Policy, Elsevier, vol. 124(10), pages 1108-1114.
    12. Se Hee Lee & Seung-Lai Yoo & Joon Seok Bang & Jong Hyuk Lee, 2020. "Patient Accessibility and Budget Impact of Orphan Drugs in South Korea: Long-Term and Real-World Data Analysis (2007–2019)," IJERPH, MDPI, vol. 17(9), pages 1-8, April.
    13. Peter Ghijben & Yuanyuan Gu & Emily Lancsar & Silva Zavarsek, 2018. "Revealed and Stated Preferences of Decision Makers for Priority Setting in Health Technology Assessment: A Systematic Review," PharmacoEconomics, Springer, vol. 36(3), pages 323-340, March.
    14. Livio Garattini & Alessandro Curto, 2016. "Performance-Based Agreements in Italy: ‘Trendy Outcomes’ or Mere Illusions?," PharmacoEconomics, Springer, vol. 34(10), pages 967-969, October.
    15. Hofmann, Bjørn, 2020. "Biases distorting priority setting," Health Policy, Elsevier, vol. 124(1), pages 52-60.
    16. Carlos King Ho Wong & Olivia Wu & Bernard M. Y. Cheung, 2018. "Towards a Transparent, Credible, Evidence-Based Decision-Making Process of New Drug Listing on the Hong Kong Hospital Authority Drug Formulary: Challenges and Suggestions," Applied Health Economics and Health Policy, Springer, vol. 16(1), pages 5-14, February.
    17. Rotteveel, A.H. & Reckers-Droog, V.T. & Lambooij, M.S. & de Wit, G.A. & van Exel, N.J.A., 2021. "Societal views in the Netherlands on active disinvestment of publicly funded healthcare interventions," Social Science & Medicine, Elsevier, vol. 272(C).
    18. Livia Lovato Pires de Lemos & Augusto Afonso Guerra Júnior & Marisa Santos & Carlos Magliano & Isabela Diniz & Kathiaja Souza & Ramon Gonçalves Pereira & Juliana Alvares & Brian Godman & Marion Bennie, 2018. "The Assessment for Disinvestment of Intramuscular Interferon Beta for Relapsing-Remitting Multiple Sclerosis in Brazil," PharmacoEconomics, Springer, vol. 36(2), pages 161-173, February.
    19. Craig Mitton & Brayan V. Seixas & Stuart Peacock & Michael Burgess & Stirling Bryan, 2019. "Health Technology Assessment as Part of a Broader Process for Priority Setting and Resource Allocation," Applied Health Economics and Health Policy, Springer, vol. 17(5), pages 573-576, October.
    20. Viviane Cássia Pereira & Jorge Otávio Maia Barreto & Francisco Assis da Rocha Neves, 2019. "Health technology reassessment in the Brazilian public health system: Analysis of the current status," PLOS ONE, Public Library of Science, vol. 14(7), pages 1-18, July.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:aphecp:v:15:y:2017:i:4:d:10.1007_s40258-017-0307-0. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.