CONTENTS
- 1. Health Insurance Drug Price Reduction | A ‘Complete Overhaul’ of the Drug Pricing System…Structural Impact Across the Entire Industry
- - Key Contents of the Overhaul
- 2. Health Insurance Drug Price Reduction | The Key Issue Is “Not a Pricing Policy but an Industrial Structure Policy”
- - Pharmaceutical Companies’ Risks and Response Strategies
- 3. Health Insurance Drug Price Reduction | Daeryun’s Assistance
1. Health Insurance Drug Price Reduction | A ‘Complete Overhaul’ of the Drug Pricing System…Structural Impact Across the Entire Industry
The health insurance drug pricing system, including the reduction of health insurance drug prices, has been completely overhauled.
On March 26, 2026, the Ministry of Health and Welfare finalized a plan for a complete overhaul of the health insurance drug pricing system through the Health Insurance Policy Deliberation Committee.
The core of this overhaul is to sharply reduce the generic drug pricing rate from the existing 53.55% to 45%, which should be regarded as a policy that fundamentally changes the profit structure of the pharmaceutical industry.
In particular, because the overhaul covers all areas, including the listing of new drugs, the adjustment of prices for existing drugs, and supply stabilization policies, an impact across the entire industry is unavoidable.
Key Contents of the Overhaul
1) New Drugs: Expanded Access and Strengthened Management
In addition, by introducing a post-listing evaluation system that readjusts drug prices based on clinical outcomes, the framework will shift toward one of ‘rapidly bringing products to market while managing them on an ongoing basis.’
In addition, through raising the ICER threshold and introducing a flexible drug pricing contract system, opportunities for high-priced innovative new drugs to enter reimbursement coverage are also expected to expand.
2) Generics: Reduced Profitability and Restricted Market Entry
In particular, as policies such as restricting multiple-product listings, strengthening the tiered drug price reduction scheme, and expanding disadvantages for failure to meet the baseline requirements are pursued in parallel, a strategy of simply expanding the number of products is likely to no longer be effective.
3) Already-Listed Drugs: Expanded Phased Price Reductions
Because this encompasses not only newly listed drugs but also products already established in the market, companies are in a position where they must respond to long-term changes in their revenue structure.
In addition, a system of periodic drug price reassessment on a cycle of three to five years is also scheduled to be introduced going forward, so that drug price reductions are being transformed from a one-time event into a ‘constant risk.’
4) Supply-Stable Drugs: Expanded Selective Incentives
In other words, the structure is one in which selective compensation is provided in areas linked to supply stability and industrial strategy.
2. Health Insurance Drug Price Reduction | The Key Issue Is “Not a Pricing Policy but an Industrial Structure Policy”
This reduction of health insurance drug prices signifies the following structural changes.
First, it represents the weakening of the generic-centered industrial structure. Previously, stable profits could be secured through a multiple-product strategy, but with this overhaul, the sustainability of that model has declined.
Second, it represents pressure to shift toward an innovation-centered industry. The drug pricing preference policies for innovative and quasi-innovative pharmaceutical companies are interpreted as a signal that, in effect, compels the expansion of R&D investment.
Third, it represents the strengthening of post-management-centered regulation. As fast-track listing is combined with post-listing evaluation and price adjustment, drugs are changing into ‘assets that continue to be managed even after launch.’
Pharmaceutical Companies’ Risks and Response Strategies
This health insurance drug price reduction policy is a structural change that affects the entire framework of pharmaceutical companies’ revenue structures, product strategies, and regulatory response systems.
Therefore, rather than a piecemeal response, it is necessary to establish a comprehensive response strategy that encompasses the portfolio, regulation, finance, and supply chain.
In particular, elements such as the lowering of the drug pricing rate, the phased reductions for already-listed drugs, and the introduction of periodic drug price reassessment are highly likely to act as factors that, beyond short-term reductions in profit, require a long-term restructuring of the business.
Accordingly, companies must build a proactive response system centered on the following key risks.
1. Reviewing Health Insurance Drug Price Reduction Risks
2. Portfolio Restructuring Strategy
3. Responses for Innovative and Quasi-Innovative Pharmaceutical Companies
4. Responses for New Drug Listing and Post-Listing Management
5. Responses to Reimbursement Reassessment and Periodic Drug Price Adjustment
6. Supply Chain and Supply Stabilization Strategy
7. Compliance and Government Relations Responses
3. Health Insurance Drug Price Reduction | Daeryun’s Assistance
Daeryun, Korea’s ninth-largest law firm (based on 2025 National Tax Service value-added tax filings), has extensive practical experience across the healthcare and pharmaceutical industries, including regulatory responses, drug price negotiations, responses to reimbursement adequacy evaluations, and advisory work on innovative pharmaceutical company certification.
In particular, attorneys who also hold a physician’s license, attorneys who also hold a pharmacist’s license, and attorneys with experience working at pharmaceutical companies provide integrated legal services, ranging from analyzing the risks arising from changes in drug price reduction policy to advising on portfolio strategy, as well as administrative responses and dispute responses.
Because the reduction of health insurance drug prices is a key variable that directly affects a company’s revenue structure, establishing a strategy at an early stage is more important than anything else.
🔗Through the Medical Attorney Legal Consultation Reservation, we invite you to obtain a professional legal review and prepare a response strategy.
