Government: "Achieve Two New Drugs with Annual Sales of 1 Trillion Won Within 5 Years, Double Medical Device Export Volume"

Bio Job Fair Photo [Image Source=Yonhap News]

The government’s ‘Biohealth New Market Creation Strategy’ announced on the 28th reflects the determination not to fall behind in the global competition over bio hegemony. The United States has already locked down the bio market following electric vehicles. In September last year, U.S. President Joe Biden signed an executive order to strengthen domestic research and production in biotechnology. China’s bio industry benefits from both government support and a huge market, as well as favorable conditions such as the easing of COVID-19 lockdowns and economic stimulus measures (reopening). Although South Korea is still in the early stages of market formation, it is competitive in new markets like digital healthcare, where there are no global dominant companies.

The government’s measures can be broadly summarized as a swift transition to digital, strengthened support for exports, research and development, and workforce, along with legal and institutional improvements to facilitate these efforts. In exports, the goal is to create two blockbuster new drugs with annual sales exceeding 1 trillion won within five years and to double medical device export value, aiming to become one of the world’s top six biohealth powers. To this end, research and development investment will be expanded to support next-generation promising new technologies and artificial intelligence (AI) drug development, while a mega fund of 1 trillion won will be established to support global expansion. To encourage pharmaceutical companies to increase R&D investment, drug pricing that rewards innovation value, expanded incentives, and improvements to the innovative pharmaceutical company certification system will also be implemented. The number of companies stationed at the local base established in the Boston Bio Cluster (CIC) in the U.S. will be increased from the current 20 to 30 by next year.

Medical devices will be fostered as a representative export strategy industry, with exports currently at 8.6 billion dollars targeted to increase to 16 billion dollars by 2027. Core export sectors such as imaging diagnostics, in vitro diagnostics, and dentistry will receive support for technological advancement, while promising fields like digital health will see strategic investments to secure market leadership. To overcome the ‘valley of death’ in corporate R&D (failure of commercialization due to lack of funds), investments in the medical device sector will be expanded using existing policy funds such as the Health Account Mother Fund. Startups will receive preferential treatment in investment and policy finance, and bio companies will be supported with trade insurance premium discounts (20%) and increased limits (up to twice the amount).

One hundred ten thousand bio talents will be nurtured through field-centered education. The number of biohealth contract departments, currently five, will be expanded to eight by next year, and a biohealth Meister University will also be introduced. To attract foreign patients, telemedicine for foreign patients will be institutionalized, and the number of designated excellent foreign patient attraction institutions will be increased from the current 27 to more than 50 by next year. Visa restrictions will also be eased, allowing foreign siblings to enter the country.

A pan-government governance body covering all areas, the ‘Digital and Biohealth Innovation Committee (Pharmaceutical Bio Innovation Committee),’ will also be established. Legislation to establish the committee and task force is being pursued. The ‘Digital Healthcare Act,’ which includes safe use of medical data, regulatory improvements for digital healthcare, and support for digital healthcare companies, will also be enacted. Cho Kyu-hong, Minister of Health and Welfare, said, “We will strive to make South Korea a global hub in the digital and biohealth fields and secure future new growth engines.”

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