Pharma impasse at S Korea FTA talks

The recent US Free Trade Agreement talks with South Korea, taking place in the capital, Seoul, have come to an abrupt halt, threatening around $29.0 billion of trade between the two countries, because of an impasse over the pharmaceutical sector. There were also differences involving the rice market and products originating from a border town, which is sensitive as it is thought to help North Korea earn hard currency, according to local media reports. However, the negotiations are set to resume in September in Washington DC, USA.

The American delegation, headed by US Trade Representative Wendy Cutler, "expressed a strong objection to South Korea pursuing its new drug regulation without regard to ongoing FTA negotiations, which resulted in a halt in discussions," said the country's Foreign Minister. South Korea has set out plans to reduce the number of drugs reimbursed by the national insurance system and cut their prices (Marketletter May 22).

USTR Cutler declared: "we don't think this proposed change in the Korean system towards a positive [drug] list will achieve the objective that Korea has stated for itself on this sector." She added: "we believe the proposed positive list system will end up discriminating against, and limit access of Korean patients and doctors, to the most innovative drugs in the world."