Innovation Medical Device Research Labs to Be Allowed in Residential and Commercial Areas

Prime Minister Chung Sye-kyun is experiencing AI-related medical devices at the 'Data-AI On-site Visit and Meeting' held at Saltlux in Gangnam-gu, Seoul, last January. Photo by Kang Jin-hyung aymsdream@

[Asia Economy Reporter Choi Dae-yeol] Legal grounds have been established to build research facilities for innovative medical device companies in certain residential or commercial areas.

According to the enforcement decree of the "Medical Device Industry Promotion and Innovative Medical Device Support Act," approved at the Cabinet meeting on the 21st, research facilities including prototype production facilities can be constructed in areas excluding green zones, exclusive residential areas, first-class general residential areas, and conservation/production green zones as a special case for building research facilities.

This means that companies producing innovative medical devices can establish facilities in areas such as second-class general residential areas or commercial areas. This is similar to the Pharmaceutical Industry Promotion Act; however, a Ministry of Land, Infrastructure and Transport ordinance also needs to be revised for the law to function effectively, according to a Ministry of Health and Welfare official.

Innovative medical devices refer to devices that apply advanced technology or have significantly improved safety and efficacy. It also includes fields where rare and intractable diseases must be diagnosed or treated but alternative medical devices are unavailable or domestic supply is difficult. The government prepared this law to systematically foster the domestic medical device industry, and it will take effect from the 1st of next month. The enforcement decree was created this time. It falls under the jurisdiction of the Ministry of Health and Welfare and the Ministry of Food and Drug Safety.

According to the law, companies that invest a certain scale or more in research and development (R&D), based on an annual medical device sales threshold of 50 billion KRW, or companies that research, develop, and produce innovative medical devices, can be designated as innovative companies classified into "Innovation Leading Type" and "Innovation Leap Type" based on criteria such as possession of dedicated R&D personnel and organizations, medical device R&D investment performance, R&D goals, and mid- to long-term strategies. Designated innovative companies will receive financial and tax benefits. Additionally, the law includes provisions to establish a comprehensive plan containing annual implementation plans, as well as separate committees and comprehensive support centers.

According to the Ministry of Health and Welfare, as of 2018, 81% of the total 3,283 medical device companies were small-scale with sales under 1 billion KRW. Even the in vitro diagnostic device companies, which have gained attention during the COVID-19 pandemic, are small in scale but recognized for their technological capabilities, leading to increased domestic and international demand. The government expects to expand such fields through policy support.

Meanwhile, at the Cabinet meeting on the same day, a partial amendment to the enforcement decree of the "Act on Overseas Medical Advancement and Support for Foreign Patient Attraction" was also approved. This amendment re-delegates part of the "Evaluation and Designation of Medical Institutions for Foreign Patient Attraction," currently performed by the Korea Health Industry Development Institute, to the Medical Institution Evaluation and Certification Institute, and stipulates the scope and standards of the re-delegated tasks.

This content was produced with the assistance of AI translation services.