South Korea's national health insurance drug expenditure surpassed 27 trillion won, with generic medicines expanding to 44% of total spending, confirming a sustained shift toward generics.
According to the "2024 Reimbursed Drug Expenditure Report" released Wednesday by the National Health Insurance Service (NHIS), health insurance drug spending reached 27.66 trillion won last year, up 5.6% from 26.20 trillion won the previous year. The increase outpaced the 4.9% growth in overall medical expenses, pushing drug spending's share of total medical costs up 0.2 percentage points to 23.8%.
The drug spending structure is gradually shifting toward generics. Generic drug expenditure totaled 12.26 trillion won last year, accounting for 44.4% of the total. That marks a roughly 6-percentage-point increase from 38.6% in 2021. Original branded drugs still represented more than half of spending at 15.34 trillion won, but their market share continued to decline.
Chronic disease treatments drove the spending increase. Anti-cancer drugs (3.1 trillion won), anti-atherosclerotic agents (3.1 trillion won), and antihypertensive medications (2.1 trillion won) ranked among the top categories. The top five therapeutic classes accounted for 40.4% of total drug spending, or 11.2 trillion won.
South Korea's drug cost burden also remains high by international standards. Pharmaceutical spending as a share of current health expenditure stood at 19.4% in 2023, exceeding the OECD average of 14.4% by 5.0 percentage points. The figure surpasses Japan (17.6%), Germany (13.7%), and the United Kingdom (9.7%).
The government is pursuing drug pricing reform in response to rising costs and structural changes. The policy aims to maintain compensation for innovative new drugs and essential medicines while rationalizing the pricing management system to ensure the fiscal sustainability of national health insurance. An NHIS official said, "We will continue to pursue institutional improvements that can ease the drug cost burden while considering patient access and industrial competitiveness."