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Korea Innovative PHARMACEUTICAL Company Potential of Pharmaceutical Industry in Korea 2017 Korea Innovative PHARMACEUTICAL Company Potential of Pharmaceutical Industry in Korea Aging populations and growing interest in health and welfare continue companies have developed therapies in an array of areas including oncology, antibacterial, gastritis, respiratory to drive up the demand for innovative drugs across the world. Globally, infections, duodenal ulcer, diabetic foot ulcer, erectile dysfunction, hepatitis B and hypertension. R&D spending in the pharmaceutical industry was higher than any Development of innovative drugs targeting other industry (pharmaceutical and bio ranked No. 1 with 150 billion Drug development the global market Early years of drug getting on track 2010’s dollars(2015)), indicating that the future industrial structure is shifting Development of development Local manufacturing of 2000’s finished products and new processes from IT to pharmaceutical business. drug substance 1990’s 1980’s 1960/70’s Pharmaceutical Industry in Korea Launch of innovative drugs(total of 27) ’99 ’01 ’02 ’03 ’05 ’06 ’07 ’08 ’10 ’12 ’13 ’14 ’15 2016 In Korean, the value of drugs manufactured in Korea was KRW 16.9 trillion in 2015. The annual average growth rate for the past five years was 4.7 percent. In addition, the size of the pharmaceutical market was KRW 19.2 trillion in 2015. Sunpla EGF Factive Apitoxin Revanex Levovir Pelubi Noltec Pyramax Supect Duvie Riavax Acelex Olita Tab Milican Peudovaccin Zydena Mvix Kanab Zemiglo Zabolante Size and Market Trends in Pharmaceutical Industry in Korea (Unit: KRW Trillion, %) Category Production Export Import Balance Market size Sivextro(Tab.) Q-roxin Camtobell Zepeed 2011 15.4 1.9 5.4 △3.5 18.9 2012 15.6 2.3 5.7 △3.4 18.9 Sivextro(Inj.) 2013 16.2 2.3 5.2 △2.8 19.0 2014 16.4 2.5 5.4 △2.8 19.3 Suganon 2015 16.9 3.3 5.6 △2.3 19.2 Drug Development in Korea Note: 1) Pharmaceutical products include finished products, narcotic drugs, ultra narcotic, psychotropic substance and drug substance [Clinical Trials] Clinical trials grew dramatically from both qualitative and quantitative 2) Numbers in export and import categories are calculated in Korean won and converted US dollar by using annual average exchange rate at Bank of Korea perspectives 3) Market Size= Production-Export+Import Source: Pharmaceutical Industry Statistics, Korea Pharmaceutical and Bio-Pharma Manufacturers Association Already on a clear growth track with its high level of clinical trial capabilities and reliable data, Korea is emerging as Facts & Survey Report, Korea Pharmaceutical Traders Association, Korea Health Industry Statistics System a core clinical trial destination in the pharmaceutical market in Asia. Korea-based 22 major healthcare organizations, including Seoul National University Hospital, Samsung Seoul Medical Center and Asan Medical Center, have won Based on its technological competitiveness and quality drugs, the pharmaceutical industry in Korea has global certifications for their clinical study environment helping the country to build a clinical infrastructure on a taken a stride in strengthening its ability to develop innovative drugs in a short period of time, including R&D, global level. With this advanced infrastructure, Korea became the second largest host city for global clinical trials clinical trials and drug manufacturing. Impressive growth made in the last few years suggests that Korea since 2011. Korea hosted 675 cases in 2015 recording 3.5% increase compared to 652 cases in 2014. based pharmaceutical companies are ready to take a leap forward as global players. The number of multinational regional clinical trials(MRCTs) conducted by multinational pharmaceutical companies in Korea has also increased sharply since the country introduced International Conference on Harmonization Good [R&D] Development of innovative medicines and strong pipelines across various Clinical Practice(ICH GCP) in 2000. Especially, Pfizer formed a partnership with Korea as part of its global clinical therapeutic areas program in 2008, selecting 4 of its 9 global Core Research Sites(CRSs) in Korea. The local pharmaceutical industry began manufacturing both finished products and drug substances in the [Manufacturing] High level of competitiveness and ability to generate rich pipelines of 1960s, and developed new processes in the 1980s. Following the early phase of drug development in the late innovative drugs 1980s, Korean pharmaceutical industry began to develop innovative drugs in the 2000s. Since then, Korean pharmaceutical industry has been successfully developing one of the most innovative and incrementally Pharmaceutical companies in Korea have been working to ensure that their drug manufacturing facilities meet modified drugs. rigorous global standards. To reflect global trends, the guidelines on Good Manufacturing Practices(GMP) changed Since the introduction of the chemical compound patent system in 1987, the number of innovative drugs from dosage forms to prior approval of individual items in 2008. As the guidelines shifted from management of introduced in the country has also increased at a very fast pace. Korea has seen development of innovative dosage forms to that of individual items based on a step-by-step process through 2010, the quality assurance drugs across various therapeutic areas, from “Sunpla Injection,” a treatment for stomach cancer developed system for domestically manufactured drugs reached a global level. by SK Pharmaceuticals in 1999 to “Olita Tab” developed by Hanmi in 2016. So far, Korean pharmaceutical 2 3 Public-private Partnership for Development of Pharmaceutical Industry Contributing to Global Health In addition, Korea has the ability to conduct drug R&D for compounds and commercial technologies, including Korea aspiring to transforming itself into one of the top seven pharmaceutical powerhouses organic synthesis, agents and global clinical trials. This ability was gained through development of generics Korea has designated the pharmaceutical industry as one of the future growth engines, In order to foster the industry, and incrementally modified drugs. Korea is also a leader in the pharmaceutical biological technology the Korean government has been placing emphasis on enhancing growth potential through far-reaching policy area. With fruitful results from R&D including development of the world’s first stem cell therapy and measures, ranging from technology innovation to promoting market transparency, boosting global competitiveness xenotransplantation of pancreatic ducts, Korea is in an advantageous position to be a leader in promising of companies, and establishing infrastructure for sustainable development, Moreover, with knowledge and capacity future industries. The level of therapeutic technologies in cardiac surgery and management, and cervical mustered, the government, industry, medical society, and academic community are devoting themselves to make a leap cancer in Korea is the best among other OECD countries, according to OECD Health Data 2009. forward into global markets. Korea pharmaceutical industry is shifting its focus from the domestic market to the global market, and the Under the circumstance where the Korean population has been aging rapidly, the Korean government has keen interest world now pays attention to Korean pharmas as successful partners. in the pharmaceutical industry, which serves as a foundation for the quality of life of the public, The government introduced “Accreditation of Innovative Pharmaceutical Company” in 2012, and will reinforce its efforts to support the industry every year with a view to reinventing the nation into one of the top seven pharmaceutical titans. Introduction of Promotion and Support of Innovative Pharmaceutical Company Korean Pharmaceutical Market Clinical Trial Capability What Company Can Be an Innovative Pharmaceutical Company? KRW 19 Trillion(USD 18 Billion, '15) Special Act on Pharmaceutical Industry Promotion and Support (enacted in March 2011) serves as the legal foundation to ▶ Seoul, the capital of South Korea, ranks #2 for industry ▶ 1.2% of the World Market(14th) sponsored clinical trials among all cities worldwide('16) designate innovative pharmaceutical companies verified to possess high R&D capacity for new drug development and to ▶ Around 2.9% Average Annual Growth('11~'15) ▶ ‌Korea ranked as 7th in the world for Industry sponsored be globally competitive, Those companies are expected to play a leading role in developing the domestic pharmaceutical ▶ ‌Only 25% MNC dominated clinical trials('16) industry into a future growth engine. (reimbursement price based, '12) ▶ 894 manufacturers(285 for finished drugs) World Class GMP & DDS Technology Accreditation Process The Accreditation Screening Committee conducted written and verbal evaluations on candidate pharmaceutical firms New Drug Release Competency ▶ cGMP & EU GMP standard facilities ▶ Innovative Drug Delivery Systems which met the requirements (Article 2 of the Enforcement Decree of the Special Act: investment volume over a certain ▶ 27 New Drugs, 58 IMD products approved • ‌Film-type Viagra and patch-type Alzheimer's and Parkinson’s level), In the evaluations, the committee assessed candidate companies based on specific requirements, such as R&D ▶ 2~3 New drugs coming out to the market every year drugs developed, etc performance in the past, company’s capacity, vision and investment plan, ethical business practice, etc, The results of the evaluations delivered by the screening committee were finalized after the review carried out by the Committee
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