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(SEOUL=Yonhap News) Innovative pharmaceutical companies are expected to invest 20% more than the previous year in the research and development of new pharmaceutical drugs.

"Innovative pharmaceutical companies" refer to drug makers whose R&D investments exceed a certain percentage of their total sales, and has been accredited by the Minister of Health and Welfare. Currently, a total of 47 enterprises (37 pharmaceutical companies, 8 bio ventures, 2 foreign pharmaceutical companies) have received accreditation.

The Ministry announced Feb. 9 that based on an analysis carried out by the Korea Health Industry Development Institute on the business plans of 42 innovative pharmaceutical companies, they planned to invest a combined KRW 1.2 trillion in R&D this year, an approximately 21% increase from last year's KRW 1 trillion.

In annual sales, the companies hope to reach KRW 11 trillion, which would be an approximately 9.8% increase from last year's KRW 10 trillion.

More specifically, 36 companies (including CJ HealthCare, which is currently developing a new drug for gastroesophageal reflux disease) intend to carry out nonclinical studies and clinical trials to develop innovative new pharmaceutical drugs, biological products, and incrementally modified drugs.

Also 27 companies (including Boryung Pharmaceutical, which plans to enter African and Middle Eastern markets, such as South Africa) will strive to establish corporate bodies and conduct clinical trials overseas to enter foreign markets, including the U.S., Europe, Central and South Americas, and Southeast Asia.

At a meeting held that day with Health Ministry officials, CEOs of innovative pharmaceutical companies explained their investment plans for the year, and requested that the Ministry recognize higher drug prices, expand national R&D funding and tax reliefs, and reduce the time it takes to approve a new drug.

According to Director Kim Gang-rip of the Office for Healthcare Policy, "the Ministry will actively try to help pharmaceutical companies grow to their fullest capacity in domestic and foreign markets by meeting their requests concerning drug prices, national R&D funding, tax reliefs, and entry into foreign markets," adding, "comprehensive government-wide measures will be put in place so that new jobs could be created through the progress made in the pharmaceutical industry."

This month, the Ministry plans to form a team exclusively in charge of creating strategic mid- to long-term plans for the pharmaceutical industry; finding the best way to support R&D for biological products, vaccines, and clinical trials; and resolving concerns related to drug prices, taxes, exports, and the training of the next generation of pharmaceutical professionals.

jandi@yna.co.kr

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Source: Yonhap News (Feb. 9, 2017)