In a significant turn of events in South Korea's pharmaceutical landscape, Daewoong Bio Group's lawsuit seeking the restoration of preferential reimbursement for choline alfoscerate, a drug aimed at enhancing cognitive function, is set to resume after a year-long hiatus. This development follows a Supreme Court ruling that dismissed a similar case by the Jong Geun Dang Group, prompting government officials to push for a swift resolution to Daewoong Bio's claims.
As of March 19, 2025, industry insiders report that Daewoong Bio and other pharmaceutical entities have submitted a request for a designated date to resume the court hearings regarding the cancellation of specific guidelines on reimbursement for health insurance drugs. This lawsuit, along with another filed by competing pharmaceutical companies, concerns the decision made by the Ministry of Health and Welfare in August 2020 to alter reimbursement standards for choline alfoscerate, a drug previously accessible with a substantially lower patient cost burden.
The core issue revolves around the government's adjustment of reimbursement rates from 30% to a staggering 80% for patients who have not been diagnosed with dementia when prescribed choline alfoscerate. This high rate of patient cost emerged as a significant concern for the pharmaceutical industry, which has been divided between Daewoong Bio and Jong Geun Dang as they both sought to challenge this reimbursement reduction in courts.
The Jong Geun Dang group suffered setbacks in both the initial trials and the following appeals, ultimately leading to the Supreme Court's rejection of their claims. These losses set a precedent that leaves the Daewoong Bio Group watching closely, as they continue their own legal battle after losing their first trial. The second trial is currently underway, and experts, based on the Jong Geun Dang case, forecast a similar outcome regarding Daewoong's efforts.
According to legal experts, this relentless pursuit of judicial clarity has implications beyond the courtroom. Increased patient costs, resulting from the reimbursement adjustments, could deter some individuals from pursuing necessary prescriptions. The Supreme Court's ruling has already confirmed that indeed the changes led to a financial burden increase—patients now face responsibilities that could rise significantly, affecting their access to this vital medication.
Industry analysis suggests that the price various choline medications may fluctuate, with Daewoong Bio's popular product, Glia Tamin, priced at approximately 476 won per tablet and Jong Geun Dang's Glia Tiline at around 500 won. A standard monthly expenditure on these medications could soar to 30,000 won if taken twice daily, leading to a patient out-of-pocket expense that could reach up to 24,000 won, an increase of 15,000 won from current patient costs.
Given the financial impact of these reimbursements, the pharmaceutical sector is bracing for the potential outcome of the Daewoong Bio case. If the court decision leans favorably toward the company, not only could it restore preferred reimbursement but also significantly alter the landscape for other medications facing similar circumstances in the future.
However, reactions within the sector are mixed, with some experts suggesting that despite the heightened costs, they expect that the price burden alone may not lead to widespread prescription discontinuation. While the increased cost translates into a burden of about 500 won daily, relative to other health products aimed at cognitive enhancement, choline medicines might still be perceived as affordable.
As stakeholders await the preliminary hearing in Daewoong Bio's lawsuit, the ongoing discussions underscore a critical juncture in public health policy, patient access to essential medications, and the financial considerations faced by both patients and pharmaceutical companies.
The consequences of the legal rulings on reimbursement have already prompted a notable shift in patient prescription patterns, reflecting a broader concern about healthcare accessibility amid evolving regulations. The pharmaceutical industry now stands at a crossroads, balancing profitability with patient needs in the face of ongoing legal scrutiny.
