South Korea Fast-Tracks Rare Disease Drug Coverage Amid Budget Concerns
South Korea has approved fast-track drug listing for rare disease treatments, reducing the insurance coverage process from 240 days to 100 days. The reform includes post-listing effectiveness evaluations and flexible pricing agreements, aiming to improve patient access to innovative treatments amid ongoing budget concerns.
South Korea has approved a drug pricing reform plan that includes fast-track listing for rare-disease treatments, despite concerns about budget impacts and weakened effectiveness verification processes. The Health Insurance Policy Deliberation Committee passed the measure on the 26th, which aims to improve access to innovative new drugs by shortening the National Health Insurance listing period for rare-disease treatments from up to 240 days to within 100 days.
Under the reform plan, after approval by the Ministry of Food and Drug Safety, the Health Insurance Review & Assessment Service's assessment period for reimbursement appropriateness will be shortened from up to 150 days to about one month. The National Health Insurance Service's drug price negotiation period will also be reduced from up to 60 days to one month. The government's goal is to manage the entire listing process, including deliberations by the ministry and the HIPDC, within 100 days.
For treatments listed through the fast track, the government will introduce a system to conduct post-listing evaluations of clinical effectiveness and cost-effectiveness using real-world evidence accumulated in actual clinical settings. Depending on the results, drug price levels, reimbursement scope, and whether to apply a risk-sharing scheme may be adjusted.
The cost-effectiveness assessment standard will also be revised. The government decided to improve the system to apply the ICER standard more flexibly by applying weights that reflect disease severity, treatment effect, and the impact on the National Health Insurance budget. Related policy research will proceed within the year and will be applied in stages starting next year.
The scope of the flexible pricing agreement system will be expanded beyond newly listed new drugs to include original drugs whose patents have expired, new drugs whose risk-sharing schemes have ended, and biosimilars. Also known as the "dual-contract system," the flexible pricing agreement keeps the publicly posted list price at a level similar to major overseas countries while the National Health Insurance Service and the pharmaceutical company separately contract for the actual applied price.
The government expects the reform to move up the timing of National Health Insurance coverage for rare-disease treatments and innovative new drugs, improving patients' access to care. However, pressure to raise premiums due to increased drug spending and debate over fiscal sustainability are expected to continue for the time being.