The national drug formulary listing process for orphan drugs in South Korea: narrative review focused on pricing and reimbursement pathways

ABSTRACT

Introduction: In addition to some countries facing challenges regarding patients with rare diseases, it has also become an important international topic. Through the efforts of many nations around the world toward providing benefits for the development of orphan drugs to improve the right to treatment of patients with rare diseases, various orphan drugs have been launched in the market. However, controversial issues such as impact on budgets due to high prices and concerns about the uncertainty of clinical outcomes are being raised. For this review, the official websites of government agencies related to the Korean national health insurance were investigated.

Areas covered: This paper reviews key factors that should be considered in the process of development, regulation, and market access of orphan drugs in South Korea with a particular focus on the pricing and reimbursement review process.

Expert opinion: It is necessary to understand the pricing and reimbursement system of orphan drugs in terms of regulations and market access from the perspective of stakeholders, namely research and development companies, patients, policymakers, and physicians. Stakeholder discussions regarding value-based pricing methodologies such as new outcome-based ris-sharing agreement schemes and multi–criteria decision analysis should be conducted more prospectively.

KEYWORDS:

• Orphan drugs
• pricing and reimbursement
• rare disease
• national health insurance
• budget impact
• risk sharing

Article highlights

• Not only are some countries facing challenges regarding rare disease patients; it has also become an important international

• Regarding orphan drugs (ODs), considering the improvement of patient accessibility issues is equally important as taking positive and negative issues about pricing and reimbursement such as budget impact due to high prices and concerns about clinical efficacy into account (real-world evidence).

• OD legislation has been implemented in many countries, including the United States, European countries, Japan, and South Korea. When specific systems are operated, it is necessary to understand such systems.

• South Korea has adapted systems such as Risk Sharing Agreement (RSA), Pharmaco-Economic study Waiver (PEW), and the application of the flexible incremental cost effectiveness ratio (ICER) threshold to tackle the new drug accessibility problem related to anticancer drugs or ODs.

• In South Korean National Health Insurance Program, the proportion of expenditure on ODs is low compared to other major developed countries and the social demand for innovative orphan drugs to resolve unmet needs is expected to increase.

• To improve the accessibility of innovative ODs that are in the blind spot of pricing and reimbursement policy and to alleviate the budget impact, development and discussion regarding value-based pricing methodology should be conducted more prospectively.

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Declaration of interest

The authors have no relevant affiliations or financial involvement with any organization or entity with a financial interest in or financial conflict with the subject matter or materials discussed in the manuscript. This includes employment, consultancies, honoraria, stock ownership or options, expert testimony, grants or patents received or pending, or royalties.

Reviewer disclosures

Peer reviewers on this manuscript have no relevant financial or other relationships to disclose.