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The Korean biopharmaceutical industry, one of the most dynamic and burgeoning sectors of the Korean economy for the past decade, is expecting to continue its growth. The industry is estimated to grow more than 10% annually over the next two years, bolstered by strong government support and domestic investments.
The biopharmaceutical sector, which encompasses the creation and development of biopharmaceuticals, medicines produced from living material, was driven by the science and technology boom in Korea under the liberalization of the health policies since the late 1990s. This has provided Korea with a significant domestic energy source and great potential to expand the industry.
The main pillars of the sector are research, development and production of biopharmaceuticals. Domestic investments, large exports of Korean biosimilar drugs, dedicated venture investments and foreign direct investments from major pharmaceutical companies from the United States and Europe have enabled the industry’s swift development. This has been pushed primarily by new technologies associated with genomic medicine and stem cell research in Korea.
The private sector, with the government’s substantial support and long-term incentives, has played a major role in the development of the biopharmaceutical sector.
Government initiatives have been very focused in support of South Korea as one of the world’s top ten biopharmaceutical powers by 2013. These policies have outpaced their regional competitors while making South Korea the leader in biopharmaceuticals in the Asia-Pacific region. Under this policy, the Ministry of Health and Welfare has pledged to raise the annual growth rate of the industry by more than 10% in the next two years.
Foreign direct investments, in the form of joint research, technology and/or capital, into the South Korean biopharmaceutical industry have been steadily increasing over the past few years. In 2009 and 2010, foreign investments were up eight times and 28 times, respectively, compared to the previous year. This has invigorated the industry and created a source for crucial resources for research and development.
The South Korean biopharmaceutical industry has made great progress towards global leadership in the past decade. It is projected to surpass the ¥5 trillion marker in 2020 and become the fourth largest biopharmaceutical market in the world. Despite the rapidly changing environment, the industry remains focused on innovation and continuing to leverage global alliances in order to sustain a competitive advantage.
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