South Korea’s pharmaceuticals market was valued at $20 billion in 2012, growing from $14.5 billion in 2006 at a CAGR of 5.5%. The industry experienced slower year-on-year growth in 2009 and 2010 due to decreased raw material production. It is expected to grow at a CAGR of 7.6% to reach $31.1 billion in 2018. An increase in insurance coverage, the country’s aging population and favorable government initiatives are expected to drive the industry’s growth in the future. This new report, “South Korea Pharmaceutical Market Outlook 2013” provides in-depth analysis of the trends, issues and challenges facing the South Korean pharmaceutical market. The report also provides competitive benchmarking for the country’s leading pharmaceutical companies and analyzes the M&A (Mergers and Acquisitions) and strategic partnerships that shape its pharmaceutical industry.
Revised Drug Pricing Policy to Reduce Drug Prices of 7,500 Registered Drugs
In 2011, the Ministry of Health and Welfare (MOHW) announced that it would cut prices of some 7,500 registered drugs by 14% to control spending on drugs in the National Health Insurance (NHI) scheme by 2012. The drugs exempt from these price reductions were:
• Essential medicines, such as those included in the country’s drug shortage prevention program
• Drugs manufactured by innovative pharmaceutical companies and produced by chemical synthesis
• Medicines produced by fewer than three companies
• A medicine priced lower than others with the same efficacy
The revisions have changed the pricing mechanism for new medicines from external reference pricing to negotiations between the National Health Insurance Corporation (NHIC) and pharmaceutical manufacturers, taking into account price–volume discounts. For medicines listed prior to January 1, 2012, prices were to be reassessed according to the revised pricing policy.
Rapid Development in the Field of Stem Cell Research in South Korea
South Korea can be considered a pioneer in the field of stem cell therapy. The country has approved products for indications such as Acute Myocardial Infarction (Hearticellgram – AMI), knee cartilage injury (Cartistem), and Crohn’s disease anal fistula (Cupistem). The country is rapidly developing the field of stem cell therapy and boasts a robust pipeline that witnesses active participation from pharmaceutical companies. South Korea stands among the top leaders in stem cell research across the globe. This has been made possible by strong government support and increased funding as stem cell research is considered the next growth engine for the economy. MOHW announced an investment of KRW33 billion ($33m) as its stem cell R&D budget of 2012, four times the amount invested in 2011. The increased investment is to be utilized in the commercialization of R&D to check the safety and efficacy of these treatment technologies. Previously, money had only been invested in basic research.
Biosimilars to Become the Next Growth Engine for the Pharmaceutical Industry in South Korea
The South Korean government has set 22% of the global share in biosimilars as a target until 2020. To achieve this, the Korea Food and Drug Administration (KFDA) introduced regulatory guidelines for biosimilars in 2009 and the government created an $80m Biomedical Fund in the same year to provide financial assistance to local biotech companies for biosimilars R&D. The South Korean government is actively involved in the entire lifecycle of biosimilars. With an investment of $5 billion, the government has shaped the cities of Osong and Daegu to act as production hubs with high technical expertise.
Key Foreign Companies reviewed in this report (http://www.reportsnreports.com/reports/247362-south-korea-pharmaceutical-market-outlook-2013.html): GlaxoSmithKline, Sanofi and Pfizer
Key Domestic Companies covered in the report:
- Dong-A
- Green Cross
- Hanmi
- JW Holdings Corporation (Choongwae Holdings Co., Ltd.)
- Yuhan Corporation
List Of Tables
Table 1: Pharmaceutical Market, South Korea, Revenue ($bn), 2006–2012 11
Table 2: Pharmaceutical Market, South Korea, Revenue ($bn), 2012–2018 11
Table 3: Pharmaceutical Market, South Korea, Pharmaceutical Trade ($tn), 2006–2012 12
Table 4: Pharmaceutical Market, South Korea, Pharmaceutical Export ($m), 2008–2012 13
Table 5: Pharmaceutical Market, South Korea, Pharmaceutical Export to Leading Destinations ($m), 2010 15
Table 6: Pharmaceutical Market, South Korea, Pharmaceutical Import ($m), 2008–2012 16
Table 7: Pharmaceutical Market, South Korea, Population (million), 2000–2025 18
Table 8: Pharmaceutical Market, South Korea, Crude Death Rate (per 100,000 population) by Sex, 2005–2012 19
Table 9: Pharmaceutical Market, South Korea, Death Rate (per 100,000 population), by Type of Disease, 2001, 2010 and 2011 21
Table 10: Pharmaceutical Market, South Korea, Crude Birth Rate (per 1,000 people), 2005–2012 22
Table 11: Pharmaceutical Market, South Korea, Infant Mortality Rate by Sex (per 1,000 Live Births), 2005–2012 23
Table 12: Pharmaceutical Market, South Korea, Life Expectancy at Birth (years) by Gender, 1980–2040 24
Table 13: Pharmaceutical Market, South Korea, Healthcare Indicators, 2010 25
Table 14: Pharmaceutical Market, South Korea, Major Healthcare Benefits Expansions, 2004–2009 27
Table 15: Pharmaceutical Market, South Korea, Healthcare Expenditure as % of GDP (%), 2004–2012 32
Table 16: Pharmaceutical Market, OECD Countries, Healthcare Expenditure as % of GDP (%), 2004 – 2012 33
Table 17: Pharmaceutical Market, South Korea, OOP Expenditure as % of Total Health Expenditure (%), 2004–2012 34
Table 18: Pharmaceutical Market, OECD Countries, OOP Expenditure as % of Total Health Expenditure (%), 2004–2012 35
Table 19: Pharmaceutical Market, South Korea, Public Spending as % of Total Health Expenditure, 2004–2012 36
Table 20: Pharmaceutical Market Outlook, South Korea, Health Workforce and Infrastructure, 2012 37
Table 21: Pharmaceutical Market, South Korea, Out-Of-Pocket payment, 2011 39
Table 22: Pharmaceutical Market, South Korea, Comparison between Long-term Care Insurance and Elderly Benefit Schemes, 2012 39
Table 23: Pharmaceutical Market, South Korea, OTC Drugs Market ($bn), 2006–2012 41
Table 24: Pharmaceutical Market, South Korea, OTC Drugs Market ($bn), 2012–2018 41
Table 25: Pharmaceutical Market, South Korea, Prescription Drugs Market ($bn), 2006–2012 42
Table 26: Pharmaceutical Market, South Korea, Prescription Drugs Market Forecast ($bn), 2012–2018 42
Table 27: Pharmaceutical Market, South Korea, Marketed Products, 2011 43
Table 28: Pharmaceutical Market, South Korea, Generics Market ($bn), 2006–2012 44
Table 29: Pharmaceutical Market, South Korea, Generics Market Forecast ($bn), 2012–2018 44
Table 30: Pharmaceutical Market, South Korea, Government Investment in Biotechnology ($m), 2000–2010 45
Table 31: Pharmaceutical Market, South Korea, Biotechnology Market ($bn), 2006–2012 46
Table 32: Pharmaceutical Market, South Korea, Biotechnology Market Forecast ($bn), 2012–2018 46
Table 33: Pharmaceutical Market, South Korea, GlaxoSmithKline Korea, Strategic Consolidations, 2011 55
Table 34: Pharmaceutical Market, South Korea, Sanofi-aventis Korea, Strategic Consolidations, 2012 55
Table 35: Pharmaceutical Market, South Korea, Dong-A, Strategic Consolidations, 2011–2012 57
Table 36: Pharmaceutical Market, South Korea, Green Cross, Strategic Consolidations, 2011 58
Table 37: Pharmaceutical Market, South Korea, Hanmi, Strategic Consolidations, 2011–2012 59
Table 38: Pharmaceutical Market, South Korea, Yuhan, Strategic Consolidations, 2011 60
List Of Figures
Figure 1: Pharmaceutical Market, South Korea, Revenue ($bn), 2006–2018 10
Figure 2: Pharmaceutical Market, South Korea, Pharmaceutical Trade ($tn), 2006–2012 12
Figure 3: Pharmaceutical Market, South Korea, Pharmaceutical Export ($m), 2008–2012 13
Figure 4: Pharmaceutical Market, South Korea, Pharmaceutical Export by Type (%), 2008–2012 14
Figure 5: Pharmaceutical Market, South Korea, Pharmaceutical Export to Leading Destinations ($m), 2010 15
Figure 6: Pharmaceutical Market, South Korea, Pharmaceutical Import ($m), 2008–2012 16
Figure 7: Pharmaceutical Market, South Korea, Pharmaceutical Import by Type (%), 2012 17
Figure 8: Pharmaceutical Market, South Korea, Population (million), 2000–2025 18
Figure 9: Pharmaceutical Market, South Korea, Crude Death Rate (per 100,000 population) by Sex, 2005–2012 19
Figure 10: Pharmaceutical Market, South Korea, Causes of Death (%), 2011 20
Figure 11: Pharmaceutical Market, South Korea, Death Rate (per 100,000 population), by Type of Disease, 2001, 2010 and 2011 21
Figure 12: Pharmaceutical Market, South Korea, Crude Birth Rate (per 1,000 People), 2005–2012 22
Figure 13: Pharmaceutical Market, South Korea, Infant Mortality Rate by Sex (per 1,000 live Births), 2005–2012 23
Figure 14: Pharmaceutical Market, South Korea, Life Expectancy at Birth (years) by Gender, 1980–2040 24
Figure 15: Pharmaceutical Market, South Korea, Healthcare Indicators, 2010 25
Figure 16: Pharmaceutical Market, South Korea, Drivers and Barriers, 2012 26
Figure 17: Pharmaceutical Market, South Korea, Organization of the Korean Food and Drug Association, 2012 29
Figure 18: Pharmaceutical Market, South Korea, Organization of the National Institute of Food and Drug Safety Evaluation, 2012 30
Figure 19: Pharmaceutical Market, South Korea, Healthcare Expenditure as % of GDP (%), 2004–2012 32
Figure 20: Pharmaceutical Market, OECD Countries, Healthcare Expenditure as % of GDP (%), 2004–2012 33
Figure 21: Pharmaceutical Market, South Korea, OOP Expenditure as % of Total Health Expenditure (%), 2004–2012 34
Figure 22: Pharmaceutical Market, OECD Countries, OOP Expenditure as % of Total Health Expenditure (%), 2004–2012 35
Figure 23: Pharmaceutical Market, South Korea, Health Workforce and Infrastructure, 2012 37
Figure 24: Pharmaceutical Market, South Korea, National Health Insurance Operations, 2012 38
Figure 25: Pharmaceutical Market, South Korea, OTC Drugs Market ($bn), 2006–2018 41
Figure 26: Pharmaceutical Market, South Korea, Prescription Drugs Market ($bn), 2006–2018 42
Figure 27: Pharmaceutical Market, South Korea, Generics Market ($bn), 2006–2018 44
Figure 28: Pharmaceutical Market, South Korea, Government Investment in Biotechnology ($m), 2000–2010 45
Figure 29: Pharmaceutical Market, South Korea, Biotechnology Market ($bn), 2006–2018 46
Figure 30: Pharmaceutical Market, South Korea, Manufacturing Share by Type (%), 2009 47
Figure 31: Pharmaceutical Market, South Korea, Number of M&A Deals, 2007–2012 48
Figure 32: Pharmaceutical Market, South Korea, M&A Deals, Deals by Value (%), 2007–2012 49
Figure 33: Pharmaceutical Market, South Korea, Number of Partnership Deals, 2007–2012 50
Figure 34: Pharmaceutical Market, South Korea, Partnership Deals, Deals by Value (%), 2007–2012 50
Figure 35: Pharmaceutical Market, South Korea, Number of Licensing Deals, 2007–2012 51
Figure 36: Pharmaceutical Market, South Korea, Licensing Deals, Deals by Value (%), 2007–2012 51
Figure 37: Pharmaceutical Market Outlook, South Korea, US–Korea FTA, 2012 53
Figure 38: Pharmaceutical Market, South Korea, Biopharmaceutical Implementation Strategies, 2011 62
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