The primary legislation governing pharmaceuticals in Korea is the Pharmaceutical Affairs Act (PAA). The Act on the Safety of and Support for Advanced Regenerative Medicine and Advanced Biological Products (AABP) regulates cutting-edge biopharmaceutical products such as cell therapy, gene therapy, and tissue engineered products. The Medical Devices Act and the In-Vitro Medical Devices Act (collectively, MDA) regulate medical devices. All Acts, together with related presidential decrees, regulations and guidelines, are promulgated by the Office of the Prime Minister and the Ministry of Food and Drug Safety (MFDS).

On a related note, the Digital Medical Product Act was newly enacted on 23 January 2024. It aims to define and regulate digital medical products, including digital medical devices, digital integrated drugs, and digital medical/healthcare support devices. Such products were previously governed by the existing PAA, Medical Device Act, In Vitro Diagnostic Medical Devices Act, their subordinate regulations, and MFDS guidelines. The Digital Medical Product Act will now have precedence over those regulations. It will first be effective for digital medical devices and digital integrated drugs on 24 January 2025, and sequentially for digital medical/healthcare support devices on 24 January 2026.

The Ministry of Health and Welfare (MHW) and the MFDS (which is overseen by the MHW) are the main regulatory bodies in relation to pharmaceuticals and medical devices, and they are responsible for issuing and enforcing most of the regulations, guidelines and administrative orders for pharmaceuticals and medical devices. Local governments (such as the Seoul Metropolitan government) also monitor pharmaceutical and medical device entities within their jurisdiction.

Administrative orders issued by the MFDS, MHW or local governments to entities in violation of the PAA, AABP or MDA may be challenged via an administrative appeal to the competent administrative appeals commission under the Administrative Appeals Act, or via administrative litigation to the competent court under the Administrative Litigation Act. In most cases, either action will request that the competent commission or court revoke or declare null the administrative order. Rulings rendered by an administrative appeals commission may also be appealed to the competent court.

In general, these challenge procedures are applicable to other regulated products, such as food products.

Pharmaceuticals are categorised into over-the-counter (OTC) drugs and prescription drugs. In principle, all pharmaceuticals must be delivered to patients by licensed pharmacists at pharmacies, except in some cases such as administration of pharmaceuticals to patients by doctors within medical institutions. While prescription drugs require a prescription from physicians, OTC drugs can be supplied to consumers without a prescription. Additionally, the MHW has designated certain OTC drugs as emergency drugs to treat light symptoms in urgent situations at patients’ discretion, and such OTC drugs may be sold at 24-hour convenience stores by non-pharmacists after such stores’ registration with the local government.

Medical devices are classified into Classes I to IV, based on their intended use and the risk level associated with the device. Class I devices present the lowest risk, while Class IV devices are considered the highest risk and are subject to the greatest scrutiny.

The Digital Medical Product Act, implemented for digital medical devices and digital integrated drugs as of 24 January 2025, and for digital medical/healthcare support devices, to be implemented as of 24 January 2026, separates digital medical products into the categories of digital medical devices, digital integrated drugs, and digital medical/healthcare support devices. This allows the MFDS to classify digital medical products into different tiers depending on their purpose, function, and potential risk, among other factors.

The PAA, the MDA, the Bioethics and Safety Act (BSA) and relevant regulations govern clinical trials of medicinal products and medical devices, and the MFDS oversees approval for clinical trials.

To conduct a clinical trial, the relevant clinical trial protocol must be reviewed and approved by an institutional review board (IRB) of the MFDS. The materials required to be submitted by the applicant for clinical trial approval include the following:

• for medicinal products, the clinical trial protocol, development plan, investigator’s brochure, material on manufacturing and quality of the investigational drug, preclinical trial data, materials on medical institution conducting the clinical trial, institute analysing the clinical trial sample, and the investigator and Contract Research Organisation (CRO), policies and forms regarding the clinical trial subjects, etc; and
• for medical devices, the clinical trial protocol, materials proving that the clinical trial medical device is being manufactured in accordance with the facility, manufacturing and quality management system standards, purpose of use, working principle and technical documents to verify performance and safety.

Once approved, clinical trials must be conducted in accordance with the protocol and standards regarding good clinical practice for medicinal products and medical devices, as applicable.

All clinical trials are registered with the MFDS. Basic information regarding clinical trials such as sponsor information, information on the clinical trial including its title, purpose and use, information of drug used, plan for clinical trial, method to arrange the participants subject to experimental group or control group, the status of the clinical trial (eg, on-going, completed), method to administer and evaluate the clinical test (eg, primary and secondary end point), and subject inclusion and exclusion criteria can be searched at the medicinal products comprehensive information system, which is a website of the MFDS.

No restriction exists on using online tools to support clinical trials. However, it is generally required that clinical trials are to be conducted by doctors or hospitals with in-person interviews, and written informed consents from clinical trial subjects. Recruitment of clinical trial subjects can be conducted online.

When a crisis alert level of serious magnitude or higher is declared, and if deemed necessary to protect patients, medical personnel, and medical institutions from the risk of infection, the protocols allowing provisional “untact” medical care (a term coined by a research team in Korea for non-face-to-face contact) under Article 49–3 of the Infectious Disease Control and Prevention Act may be implemented. This may apply to clinical trials, where the treatment for and monitoring of patients during clinical tests may be converted to untact treatment and monitoring.

The data from clinical trials is considered as personal and sensitive data and the institutions conducting clinical trials are subject to the Personal Information Protection Act (PIPA) for the collection, use, provision, etc, of such personal and sensitive information. In addition, information with respect to the participant’s identity or sponsor’s intellectual property, etc, shall not be disclosed to third parties unless there is explicit permission granted to access that information. Further, in order to protect the clinical trial subjects’ identity, unique identity numbers need to be assigned to subjects instead of their name.

When obtaining consent on the clinical trial from its subjects, the medical institution conducting the clinical trial must explain that the records of subjects’ personal information will be kept confidential, stipulate the same in writing, and make it clear that such personal information shall be maintained confidential even if results of the clinical trial become publicly available. It further needs to inform that the records relating to clinical trial including the subjects’ medical record can be accessed by the sponsor’s monitoring agent or inspector through an institutional review board (IRB) of the medical institution, and that the MFDS may also access and review such information and relevant materials.

In addition to the requirements described in 2.5 Use of Data Resulting From Clinical Trials, according to clinical trial management standards, such database needs to have a security system which prevents unauthorised persons from accessing the information, and matters as prescribed by the chief of MFDS for proper management of electronic records must be complied with. The sponsor also has to use identifier code for clinical trial subjects. 

Under Article 2 of the PAA, “drugs” are defined as those other than quasi-drugs, among the articles listed in the Korean Pharmacopoeia, or articles, other than appliances, machinery or equipment, used for the purposes of diagnosis, treatment, alleviation, care or prevention of diseases of human beings or animals, or used for the purpose of exerting pharmacological effects upon the structure or functions of humans or animals.

A “medical device” is defined under the MDA as an instrument, machine, apparatus, material, software or any other similar product specified in the following:

• a product used for the purpose of diagnosing, curing, alleviating, treating or preventing a disease;
• a product used for the purpose of diagnosing, curing, alleviating or correcting an injury or impairment;
• a product used for the purpose of testing, replacing or transforming a structure or function; and/or
• a product used for the control of conception.

With regard to medical devices, sometimes it is difficult to distinguish medical devices from personal healthcare products (which do not require medical device approval) even when considering the purpose of use and the risk to the human body. In such case, guidance or administrative interpretation from the MFDS may be requested.

To market biological drugs in Korea, the initial marketer is required to obtain marketing approval the same as that for chemical drugs. Key factors to consider when reviewing an application for market approval are:

• data on origin or discovery and development process;
• data on structure and physicochemical properties;
• data on stability;
• toxicological data;
• data on pharmacological mechanism;
• data on clinical trial results; and
• data on domestic and overseas usage and approval status.

For some biologics such as the botulinum toxin, additional strict requirements on use, transfer, etc, apply. Meanwhile, unlike generic drugs, a bioequivalence test does not replace data on stability and efficacy in order to obtain market approval for biosimilars.

On the other hand, cell therapy products (medicine manufactured by physical, chemical, or biological manipulation, such as cultivation, proliferation, or screening of living cells of humans or animals in vitro), gene therapy products (medicine containing genetic material or drug-containing cells into which genetic material has been modified or introduced), tissue-engineered products (medicine manufactured by applying engineering technology to living cells or tissues of humans or animals for the purpose of regenerating, restoring or replacing tissues), advanced bio-convergence products (cell therapy products, gene therapy products, tissue engineered products, and medicinal products formed through physical and chemical combination (including fusion, complex, combination) with medical devices under the MDA) are regulated by AABP, and marketing authorisation must be obtained accordingly. (For those not regulated by AABP, PAA applies.)

Under the PAA, marketing authorisation for pharmaceuticals is valid for five years, and renewal is required after five years. For renewal, safety data, domestic manufacturing/import data, and a GMP compliance certificate must be submitted to the MFDS at least six months before the expiration date. If the marketing authorisation holder does not file the application for renewal or fails to meet the requirements, the marketing authorisation is cancelled.

In the case of medical devices, no renewal system existed previously, but since 8 October 2020, marketing authorisation for medical devices is to be valid for five years from the marketing authorisation date. Similar to pharmaceuticals, for medical devices, data proving that safety and efficacy has continued to be the same since the initial issuance of the marketing authorisation, and data on production/import performance, etc, must be submitted for renewal at least 180 days before the expiration date.

Data proving safety and efficacy, such as clinical trial results, must be submitted to the MFDS for obtaining marketing authorisation. In some cases, such as generic drugs or incrementally modified drugs, however, safety and efficacy data can be replaced with bioequivalence test result data.

The procedure for assessing marketing authorisation on medical devices varies depending on the risk they pose to human bodies. In the case of high-risk medical devices (Class III/IV), a higher level of scrutiny will apply, such as requesting and reviewing more data, including clinical data proving the efficacy and safety, compared to low-risk medical devices (Class I/II) where various data such as clinical trial data is exempted.

In the event that the indications for drugs or medical devices are changed after marketing authorisation, it is possible to file an approval for change, and the procedure is similar to the procedure for new marketing authorisations.

It is also possible to transfer a market approval from one market approval holder to another.

In Korea, even if no marketing authorisation has been obtained, investigational drugs can, after relevant clinical trials are implemented and approved, be used as part of a compassionate use programme. The compassionate use programme is permitted only in the following cases:

• when treating patients with life-threatening conditions such as an end-stage cancer or acquired immunodeficiency syndrome (AIDS);
• when treating emergency patients, such as those in a critical condition or for whom there are no alternative treatment options; and
• when attempting to use investigational drugs for research or analysis (referring to research or analysis not involving human subjects).

In addition, certain orphan drugs and drugs for the treatment of rare diseases that are directly imported and distributed by the Korea Orphan & Essential Drug Center (KOEDC), as well as drugs that the MFDS admits for urgent introduction for the treatment of patients, are exempted from the requirement for obtaining marketing authorisation.

Effective as of 21 February 2025, the existing re-examination system for pharmaceuticals will be abolished, and the safety management system for pharmaceuticals will be integrated into a comprehensive Risk Management Plan (RMP) system.

According to the PAA, those who wish to apply for market approval (or notification, as applicable) for new drugs, orphan drugs, advanced biopharmaceuticals, already approved drugs, or prescription drugs with a different type or combination ratio of active ingredients, must establish and submit a comprehensive drug safety management plan, known as the Risk Management Plan (RMP), which includes items for which information on safety and efficacy needs to be collected, or other types of risk mitigation methods as applicable. Those who have received market approval must conduct risk management according to the RMP and regularly submit the relevant results to the MFDS.

The MDA stipulates that the head of the MFDS may conduct safety and efficacy investigations for at least four years and no more than seven years on newly developed medical devices, orphan medical devices, and medical devices equivalent to newly developed medical devices.

Approved pharmaceuticals or medical devices may be subject to re-evaluation if the MFDS finds it necessary to re-evaluate the safety and efficacy of the product. To re-evaluate, the MFDS reviews not only documents and materials submitted before the marketing authorisation, but other post-approval information, including side-effect data since launch, status in other countries and amendments to the marketing authorisation made in relation to safety and efficacy.

Under the PAA and MDA, if the applicant files a request in writing to protect information or data contained in the application for marketing authorisation against disclosure, such information or data should not be disclosed unless otherwise required by the public interest. The PAA and MDA even impose criminal penalties for breaching the non-disclosure obligation above.

Further, the Korean Criminal Act (KCA) punishes a public official or former public official who divulges secrets obtained in the course of performing their official duties.

While the contents of the application are not disclosed, third parties may infer from the following circumstances that certain marketing authorisations may be granted shortly:

• clinical trial approval status for drugs is published on the MFDS website; in particular, it can be inferred that generic drugs are scheduled to be released from the clinical trial approval status, since the submission of bioequivalence test results is required for approval of generic drugs; and
• the MFDS notices the DMF registration of APIs on its website.

The expedited (priority) review of pharmaceuticals is primarily governed by the PAA, the Act on the Safety and Support for Advanced Regenerative Medicine and Advanced Biopharmaceuticals, and the Special Act on the Promotion of Development and Emergency Supply of Medical Products for Public Health Crisis Response.

Under the PAA, the MFDS can designate a drug for priority review based on the applicant’s request if it falls into one of the following categories: (i) a drug used for treating serious or rare diseases with no alternative available, or one expected to significantly improve safety and efficacy compared to existing alternatives; and (ii) a new drug developed by an innovative pharmaceutical company designated as such by the MHW. Such designated drugs must be reviewed within 90 days, barring exceptional circumstances.

According to the Act on the Safety and Support for Advanced Regenerative Medicine and Advanced Biopharmaceuticals, drugs can be designated for expedited processing upon the request of the developer if any of the following conditions is met: (i) for the treatment of life-threatening diseases like cancer with no alternatives; (ii) for the treatment of rare diseases as defined by the Rare Diseases Management Act; or (iii) for the prevention or treatment of bioterrorism-related or other pandemic infectious diseases. These expedited drugs will be prioritised over other non-designated product approvals.

The Special Act on the Promotion of Development and Emergency Supply of Medical Products for Public Health Crisis Response mandates that preliminary crisis-response medical products, designated by the head of MFDS for preventing or treating infectious diseases posing a serious threat to public health, should be reviewed within 40 days barring exceptional circumstances.

For medical devices, an expedited review system exists for orphan medical devices, innovative medical devices, and those under the integrated review of approval and new medical technology assessment. The MDA stipulates that orphan medical devices, designated by the head of MFDS for their special utility value for rare diseases, can be reviewed and approved expeditiously. The Medical Device Industry Enhancement and Innovative Medical Device Support Act allows for advanced technological devices, significantly improving upon existing devices or treatments, to also receive expedited review. Regulations for the Integrated Operation of Medical Device Approvals and Assessments aim to shorten the market entry period by concurrently reviewing device approval, insurance benefit eligibility, and new medical technology assessments.

South Korea does not have a system in place for the expedited approval of pharmaceuticals that have been approved in other countries. However, there are regulations that allow for the submission of clinical trial data conducted abroad when applying for market approval (or notification, as applicable) of pharmaceuticals.

According to the PAA, foreign clinical trial data can be submitted in place of safety and efficacy data for Koreans during the domestic approval process. However, due to ethnic differences, it is challenging to only use foreign clinical data. Therefore, the law requires that simplified clinical trial data obtained from studies conducted specifically on Koreans be submitted together with the foreign clinical data.

Regarding medical devices, the MDA stipulates that clinical trial data related to the safety and efficacy of the medical devices must be submitted during the approval process. Submission of foreign data generated by institutions recognised for their reliability and determined to have been generated in accordance with medical device clinical trial management standards is allowed. While submission of bridging data is not explicitly mandatory for medical devices, the MFDS may request additional data from domestic trials if it is deemed difficult to directly apply foreign clinical trial data.

A manufacturing plant of pharmaceutical products is subject to an authorisation for manufacturing pharmaceuticals under the PAA, and a manufacturing plant of medical devices needs an authorisation for manufacturing medical devices under the MDA. The MFDS grants such authorisation. When a person, who intends to manufacture pharmaceuticals or medical devices, prepares and files the application for manufacturing authorisation and necessary documents with the local district of MFDS to which the manufacturer belongs, such local district MFDS reviews whether the applicant for manufacturing approval (in the case of a company, the representative) is qualified, whether all necessary documents are satisfied, and assesses whether the applicant has necessary facilities and labour force, and if appropriate, it grants authorisation. Once authorisation is granted, it will be valid without any other special renewal procedure unless grounds for revocation occur under the PAA or the MDA.

Of note, separate from MFDS’s authority under PAA/MDA with regard to requirements for facilities and labour force, other licences/authorisations will be required for plant construction (such as those related to environment and safety).

Wholesale of pharmaceuticals is subject to authorisation from the head of Si/Gun/Gu (ie, the local government) in Korea. To obtain such authorisation, the applicant should meet qualifications and have a business place, warehouse and other facilities as prescribed by Presidential Decree of the PAA. The authorised wholesaler is in principle required to employ a pharmacist to manage the relevant tasks. Such authorised wholesaler can sell or acquire pharmaceuticals for sales purposes which comply with the standards for quality management of pharmaceuticals in distribution. There is no validity period for the authorisation of wholesale of pharmaceuticals. 

For the wholesale of medical devices, the wholesaler should file a notification of distribution with the competent Special Self-Governing Mayor, Special Self-Governing Province Governor, or the head of a Si/Gun/Gu. Once such notification of distribution is accepted, the person can distribute medical devices and there is no period of validity for wholesale notification.

Pharmaceuticals are classified into OTC drugs and prescription drugs under the PAA.

OTC drugs refer to any of the following drugs, which meet the standards determined and publicly notified by the Minister of Food and Drug Safety, following consultations with the Minister of Health and Welfare:

• a drug, the misuse or abuse of which is of little concern, and whose safety and efficacy can be expected even when used without a prescription by a physician;
• a drug that may be used to treat a disease without a physician’s or dentist’s professional knowledge; and/or
• a drug which has a relatively small side effect on human bodies in light of their dosage form and pharmacological action.

Emergency drugs among the OTC drugs are used mainly for minor symptoms at the sole discretion of patients, and are publicly notified and prescribed by the Minister of Health and Welfare. Such emergency drugs can be purchased at places other than pharmacies. Conversely, prescription drugs mean drugs which are not OTC drugs and require a physician’s prescription. 

Meanwhile, orphan drugs mean either drugs used for the purposes of diagnosis or treatment of rare diseases under the Rare Disease Management Act or drugs with rare subject of application, whose alternative drug does not exist or whose safety or efficacy has been significantly improved compared to its alternative drug, which are designated by the Minister of Food and Drug Safety.

Other than the above, drugs essential for health and medical treatment, whose stable supply is difficult based only on market function, are designated and managed as national essential drugs.

The PAA and MDA are the primary laws governing the import and export of pharmaceuticals and medical devices, while the Customs Act and Integrated Public Announcement promulgated by the Ministry of Trade, Industry and Energy (MOTIE) pursuant to the Foreign Trade Act, apply the requirements of the PAA and MDA to the actual customs process.

In principle, pharmaceuticals and medical devices manufactured abroad are subject to the same regulations as those manufactured domestically. The importers of such products are responsible for obtaining the necessary licences from the MFDS, such as import business licences and marketing authorisation for particular products, and complying with all obligations under the PAA or MDA, such as quality testing. In addition to the above, importers also need to register overseas manufacturing facilities and undergo inspections of those facilities.

A manufacturing business licence and manufacturing authorisations for particular products are required for the manufacture of pharmaceuticals or medical devices, whether for domestic use or export. However, manufacturing authorisations for pharmaceuticals or medical devices that are only exported, and not sold or distributed domestically, are exempted from certain requirements and do not require renewal.

The MFDS regulates licences and authorisations for both pharmaceuticals and medical devices, while the Korean Customs Service enforces the relevant regulations at the point of entry for imports.

Only those with an import business licence from the MFDS for pharmaceuticals or medical devices can act as their importer of record.

In order to receive an import business licence for either pharmaceuticals or medical devices, the entity applying for the licence must fulfil certain requirements, such as having the required storage facilities, quality testing facilities and equipment, and personnel such as import managers and safety managers. Additionally, local presence is required in order to hold an import business licence for pharmaceuticals and medical devices.

In principle, only entities with an import business licence and marketing authorisation for the particular imported product can import pharmaceuticals or medical devices into Korea.

Exceptions of varying degrees to this rule include imports for the treatment of rare diseases, emergency use, clinical trials, research and testing, and personal use.

The Customs Act requires those who import products required by law to have approval, licence, labelling or fulfil other requirements for their importation to show proof of the fulfilment of such conditions to the head of the competent customs office, which for pharmaceuticals and medical devices are the requirements imposed by either the PAA (for pharmaceuticals) or the MDA (for medical devices), see 7.1 Governing Law for the Import and Export of Pharmaceuticals and Medical Devices and Relevant Enforcement Bodies to 7.3 Prior Authorisations for the Import of Pharmaceuticals and Medical Devices.

Whether the imported product is subject to the regulations and requirements of either the PAA or MDA would be determined by whether the product satisfies the criteria for pharmaceuticals or medical devices as defined in the respective acts.

As of February 2025, Korea has entered into 22 economic partnership agreements and free trade agreements with other countries, all 22 of which (the RCEP and FTAs with Chile, Singapore, EFTA, ASEAN, India, the European Union, Peru, the United States, Türkiye, Australia, Canada, China, New Zealand, Vietnam, Colombia, MERCOSUR, the United Kingdom, RCEP, Israel, Cambodia, Indonesia and Philippines) are in force.

The government’s price control for pharmaceuticals is based on the relevant laws such as the National Health Insurance Act (NHIA), the Rules on the Standards of National Health Insurance Medical Benefits, and the Standards for Decision or Adjustment on Drugs. Also, the government’s price control for medical devices is in accordance with NHIA, the Rules on the Standards of National Health Insurance Medical Benefits, and the Standards for Decision or Adjustment on Activity and Medical Materials for Treatment, etc. The MOHW, the Health Insurance Review and Assessment Service (HIRA) and national healthcare insurance system (NHIS) control the price of pharmaceuticals and medical devices.

Prices for the majority of medical services provided and pharmaceuticals sold in Korea are reimbursed by the Korean NHIS, and most legal residents of Korea are insured by NHIS. NHIS classifies the items subject to reimbursement into the following categories: pharmaceutical products, therapeutic procedures, and treatment materials. Here, treatment materials refer to consumable medical devices used in therapeutic procedures.

If a medical service or a pharmaceutical product is covered by NHIS, a patient cannot be charged more than the co-payment amount corresponding to the maximum reimbursement price published by the MOHW. If a medical service or pharmaceutical is not covered by NHIS, the healthcare provider is free to determine the price of such product or service.

For pharmaceuticals and medical services to be reimbursed, the HIRA and the MOHW determine whether to reimburse the costs for medical services or pharmaceuticals after evaluating clinical efficacy, cost-effectiveness, and other factors.

Regarding medical devices covered by the NHIS, the device may be subject to its own maximum reimbursement price, or the cost of the medical device may be included in the maximum reimbursement price for the relevant medical service that utilises such a device.

For drugs, foreign prices may be referenced in the negotiation of the drug’s maximum reimbursement price. In general, the economic evaluation for pharmaceuticals takes precedence over such external price referencing in determining the price of drugs. Foreign prices have direct effect only when deciding the price of drugs whose economic evaluation can be exempted under relevant pricing regulations.

Meanwhile, in the case of pricing of medical devices (ie, pricing of the device or the medical service that utilises such a device), foreign prices are not referenced but the import price or the price of listed products with similar function are considered.

A substantial part of the costs of pharmaceuticals and medical services (using medical devices) is covered by the national health insurance scheme. However, even when covered by the national health insurance scheme, the full amount is not paid by the health insurance, as the patient is responsible for the applicable co-pay amount.

Rules on the Standards of National Health Insurance Medical Benefits, and the Standards for Decision or Adjustment on Drugs define the items not subject to reimbursement. Such items include procedures, drugs, or treatment materials that are performed or used in cases where there is no hindrance to work or daily life, are not intended to improve essential bodily functions, or are preventative treatments not directly aimed at treating diseases or injuries.

There is a difference in the way pharmaceuticals and medical services are covered by health insurance. In the case of pharmaceuticals, products not listed on the reimbursement list are not covered by health insurance (positive-listing system). When a manufacturer or importer submits a request for reimbursement for a pharmaceutical product that has obtained marketing authorisation (MA), the product undergoes an evaluation of reimbursement appropriateness by HIRA. Subsequently, negotiations with the NHIS determine the maximum reimbursement amount. This process establishes the product’s eligibility for health insurance coverage, the criteria for such eligibility, and the maximum reimbursement amount. Finally, the MOHW includes the product on the reimbursement list. However, in the case of medical services, the MOHW stipulates medical services not covered by health insurance (negative-listing system).

Where drugs are concerned, it is the principle of the positive listing system to determine the eligibility for reimbursement and reimbursement amount on the basis of HTA (health technology assessment – ie, cost-utility analysis). In the case of pharmaceuticals for treatment of cancer or orphan diseases, however, economic evaluation may be omitted if certain criteria are met.

Meanwhile, for medical devices, the cost-effective analysis would play a minor role only to a limited extent in determining the eligibility for reimbursement and reimbursement amount.

After the separation of prescribing and dispensing in 2000, only physicians can prescribe drugs in hospitals, and only pharmacists can dispense drugs in pharmacies (this applies to the case of outpatient only, and dispensing drugs in pharmacies within the hospital is possible for inpatients). In order to prevent the over-prescription of narcotic or psychotropic drugs such as propofol, monitoring of prescription details is performed through HIRA’s big data management system.