Updated on 28 May 2012
In October 2011, the US approved the Republic of Korea-United States Free Trade Agreement (KORUS FTA), which was first signed in 2007. The KORUS FTA will include the phasing-out of tariffs for US drug companies and the introduction of a patent linkage system whereby drug companies will be unable to produce and sell generic drugs until the original patent expires.
According to IMS Health, the pharmaceutical market in South Korea in 2011 was $11.6 billion, registering a growth of 5.5 percent over last year. According to Business Monitor International (BMI), the pharmaceuticals expenditure in South Korea stood at $12.59 billion in 2011 and is estimated to drop 15 percent in US dollar terms to $10.68 billion in 2012 against an increase of 3.3 percent in local currency terms from KRW 13,948 billion in 2011 to KRW 14,412 billion in 2012.
Similarly, the healthcare market is expected to see an increase of six percent in local currency terms from KRW 83,118 billion ($75.03 billion) in 2011 to KRW 88,019 billion ($65.20 billion) in 2012 and negative growth of 13.1 percent in US dollar terms. The medical devices market registered 7.5 percent increase in local currency terms from KRW 4,543 billion ($4.10 billion) in 2011 to KRW 4,882 billion ($3.62 billion) in 2012 against a drop of 11.8 percent in US dollar terms.