The South Korean Ministry of Health and Welfare is currently facing significant backlash over its proposal to reduce the prices of generic drugs as a means to save costs within the national health insurance system. This planned reduction aims to allocate the saved funds towards incentives for developing new drugs, under the rationale of transforming the domestic pharmaceutical industry from one focused on generics to one centered around innovative drug development. However, industry experts and stakeholders have criticized this approach, arguing that it reflects a fundamental misunderstanding of the complexities involved in new drug development and could ultimately weaken the pharmaceutical manufacturing base instead of fostering a robust ecosystem for innovation.

In an interview with The Hankyoreh, Lee Jae-hyun, the head of the Drug Regulatory Science Center at Sungkyunkwan University, expressed serious concerns regarding the government’s strategy, calling it a case of misplaced diagnosis. Lee argues that the success of new drug development does not solely depend on the motivations of individual pharmaceutical companies but is deeply rooted in the overall foundational scientific capability of the nation. Citing examples from countries known for their successful drug development, such as the United States, the United Kingdom, Germany, and Japan, he emphasized that a robust basic scientific infrastructure is critical to produce new drug candidates.

Lee also pointed out that while Japan may not have many top-tier pharmaceutical companies, it consistently produces Nobel Prize laureates in Physiology or Medicine, demonstrating the value of investing in fundamental research. In contrast, South Korea faces a unique challenge, where many of the nation’s top talents gravitate towards medical fields, primarily becoming clinical doctors rather than researchers. As a result, the critical initial stage of producing drug candidates is neglected, raising serious questions about how lowering generic drug prices could realistically lead to breakthroughs in new drug development.