U.S.-Korea Free Trade Agreement: Potential Economy-wide ... - USITC

The transparency provisions would also require each party’s central government health
authorities to have procedures in place, within a reasonable and specified time, to allow
consideration of all formal requests for pricing and reimbursement of pharmaceutical
products and medical devices, to disclose to applicants all rules and criteria used to
determine their pricing or reimbursement, and to provide applicants with detailed written
information regarding the basis for their determinations. 13 Further, the authorities are to
afford applicants meaningful opportunities to comment at relevant points in the pricing and
reimbursement decision-making processes; to make all reimbursement decision-making
bodies open to all stakeholders, including manufacturers of both innovative (patented) and
generic products; and to establish an independent review process that may be invoked at the
request of an applicant directly affected by a reimbursement decision or recommendation. 14
With regard to regulatory cooperation, and in accordance with provisions in the TBT
chapter, 15 each party would give positive consideration to requests to recognize the results
of conformity assessment 16 procedures for marketing approval purposes by bodies in the
other party’s territory. 17 The positive consideration would apply to requests for marketing
approval of medical devices, and patented and generic pharmaceutical products.
To ensure ethical practices by pharmaceutical and medical device manufacturers or suppliers,
the chapter states that each party shall prohibit “improper inducements” by manufacturers
to health-care professionals or health care institutions for listing, purchasing, or prescribing
drugs or devices eligible for reimbursement by central government health-care programs. 18
Further, it would require each party to adopt appropriate penalties and procedures to enforce
measures discouraging such action.
With regard to disseminating product information on company Internet Web sites, the
chapter would also permit pharmaceutical manufacturers in one of the territories to
disseminate through their Internet Web sites truthful and not misleading information
regarding their products that are approved for sale in the other party’s territory. 19 Such
information must include a balance of the pharmaceutical products’ risks and benefits.
The chapter would establish a Medicines and Medical Devices Committee co-chaired by
health and trade officials of each party to monitor and support the implementation of the
substantive comments received from interested parties during the comment period; and explain any
substantive revision made with respect to the proposed regulations at the time it adopts the final regulations.
To the extent possible, each party would allow reasonable time between publication of final regulations in all
matters related to pricing, reimbursement, and regulation of pharmaceutical products and medical devices
and their effective date.
13 USTR, “Final - United States - Korea FTA Text,” 2007, Article 5.3.5.
14 To ensure the independence of the review process, a side letter dated April 4, 2007 to the USTR from
Korea's trade minister establishes a review body to be made up of professionals with relevant expertise and
experience who are not employees or members of Korea’s central government health-care authorities and
have no interest in the outcome of their reviews. Such board members are be appointed for a set period of
time and may not be removed by the health-care authorities at Korea's central level of government.
15 See chap. 5 discussion of the TBT chapter of the U.S.-Korea FTA.
16 Conformity assessment refers to any procedure used, directly or indirectly, to determine that relevant
requirements in standards or technical regulations are fulfilled. They may include procedures for sampling,
testing, and inspection; evaluation, verification, and assurance of conformity; and registration, accreditation,
and approval, as well as combinations thereof.
17 USTR, “Final - United States - Korea FTA Text,” 2007, Article 5.6.
18 Ibid., Article 5.5.
19 Ibid., Article 5.4.
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