Korea and Australia's P&MA Shift: From Local Launch Opportunities to Regional Blueprint
Recent policy shifts in these two influential health technology assessment markets signal a broader regional move toward faster, more innovation-friendly access frameworks.
Pharmaceutical companies face distinct pricing and market access (P&MA) challenges in Korea and Australia, two of Asia-Pacific's most sophisticated yet historically strict health technology assessment (HTA) markets.
Korea's limited application of confidential discounting increases international reference pricing (IRP) risk. Australia, while offering confidential discounting that avoids IRP risk, has historically delivered net prices so low that market entry often proves commercially unattractive. Their rigorous cost-effectiveness requirements and conservative reimbursement decisions have made them late-stage launch markets despite strong healthcare infrastructure and significant unmet medical needs.
With recent policy shifts in both countries, however, the economics of Korea and Australia are changing. These markets are implementing reforms designed to compete for earlier placement in global launch sequences. The question for manufacturers is no longer whether to enter Korea and Australia, but whether these markets can now serve as APAC strategic markets that establish regional pricing precedents with less access delays and lower pricing risks.
P&MA trends in South Korea
South Korea has long frustrated pharmaceutical executives. Despite its advanced healthcare system and a $13.95 billion pharmaceutical market,1 conservative pricing policies and resulting low prices have relegated it to Tier 2 or 3 in global launch strategies. Many innovative drugs arrive two to three years after US/EU launches—if at all.
Recent developments, however, signal meaningful progress. Recognizing that delayed access hurts patients and undermines its bio-innovation ambitions, Korea is implementing reforms that address manufacturers' three core pain points: speed, price, and risk.
Trend 1: Faster access through parallel processing
Korea is piloting the parallel processing of regulatory approval, reimbursement evaluation, and price negotiation for selected drugs. In contrast to its traditional sequential processing that can take well over two years, this initiative aims to enable reimbursement listing within months of regulatory approval.
The pilot targets GIFT-designated drugs for life-threatening diseases or rare indications that have demonstrated clinically significant improvement or address conditions with no existing treatment alternatives. Following the first pilot administered by the Ministry of Health and Welfare (MoHW) in 2023, three additional drugs—Winrevair (sotatercept-csrk) by MSD, Fintepla (fenfluramine) by UCB, and Rimqarto (anbal-cel) by Curocell—were selected for the second phase. After assessing the outcomes, parallel processing is likely to be adopted as a routine policy in the future.
Trend 2: IRP risk mitigation through expanded application of confidential pricing
Korea is actively considering expanding refund-based confidential pricing eligibility beyond risk-sharing agreement (RSA) drugs. Currently, only RSA-eligible drugs can use Korea’s confidential pricing system, where the visible list price aligns with A8 reference countries (the US, Japan, the UK, Germany, France, Italy, Switzerland, and Canada), while the actual net price is achieved through confidential refund.
The proposed reform would extend this pricing option to non-RSA drugs that meet specific innovation criteria, allowing manufacturers to offer competitive net prices in Korea while maintaining higher list prices that prevent IRP risk in other markets.
Trend 3: Increased reimbursements enabled by ICER reform
Korea has updated its incremental cost-effectiveness ratio (ICER) threshold, previously set in 2006 at KRW 25 million per quality-adjusted life year (KWR 50 million for rare diseases and oncology drugs). Recently reimbursed drugs, such as AstraZeneca’s Enhertu (fam-trastuzumab deruxtecan-nxki) and Gilead’s Trodelvy (sacituzumab govitecan-hziy), which were reimbursed with ICER value higher than KRW 50 million, signal pricing opportunity for high-cost innovative drugs.
This breakthrough was the result of sustained pressure from the industry and patient advocacy groups. While the government acknowledged the need for threshold updates, it maintained a conservative stance until the Korea Research-based Pharma Industry Association and patient advocacy groups united to demand better access to breakthrough therapies.
Korea's ICER evolution, particularly the role of multistakeholder advocacy, offers valuable insights for manufacturers navigating other cost-conscious APAC markets. As similar access challenges persist across the region, building multi-stakeholder coalitions may prove increasingly relevant for market access strategies.
P&MA trends in Australia
Australia has historically been a challenging market to access, especially for innovative therapies. Its rigorous HTA requirements and conservative cost-effectiveness thresholds have deterred early launches. Following the 2024 HTA Policy and Methods Review2 and 2025 Implementation Advisory Group recommendations,3 Australia is systematically addressing manufacturers' core market access barriers: demonstrating sustained commitment to rare disease reimbursement and systematizing outcome-based financing for high-cost therapies.
For companies managing APAC launch strategies, these changes signal Australia's transformation from a price-risk market into a potential anchor market where transparent processes and flexible financing can establish regional precedent without the prolonged delays that previously defined it.
Trend 1: Sustained commitment to rare diseases and advanced therapies
Australia has established itself as one of the most supportive markets for rare disease treatments and advanced therapy medicinal products, with multiple high-profile reimbursement decisions in 2024-2025 demonstrating commitment. The government now subsidizes disease-modifying therapies for spinal muscular atrophy—including the gene therapy Zolgensma (onasemnogene abeparvovec)—under Section 100, while expanding CAR-T coverage through MSAC's 2024 recommendation for Yescarta (axicabtagene ciloleucel) as second-line therapy for relapsed/refractory large B-cell lymphoma.
In July 2024, the Therapeutic Goods Administration provisionally approved Hemgenix (etranacogene dezaparvovec-drlb)—a one-time gene therapy for hemophilia B priced in the millions—and, followed by the Medical Services Advisory Committee's formal evaluation under national blood arrangements, this underscores Australia's readiness to assess and potentially fund ultra-high-cost, curative therapies.
Australia's growing use of outcomes-based contracting requires manufacturers to proactively prepare negotiation strategies. Manufacturers should draw on successful European precedents, particularly those in Italy, Germany, and the UK, as reference points in Australian discussions. Structuring proposals with clearly defined clinical endpoints, feasible registry-based data collection, and rebate triggers aligned with the Pharmaceutical Benefits Advisory Committee’s (PBAC) risk priorities can accelerate approval.
Trend 2: Shift toward innovative financing
As of June 2025, there were 316 active deeds of agreement4 between the Commonwealth and pharmaceutical companies covering special pricing arrangements and risk-sharing arrangements.
Among them, some include innovative contracting mechanisms such as outcome-based payment models that tie reimbursement to verified clinical results. For example, Zolgensma (onasemnogene abeparvovec) for spinal muscular atrophy demonstrates this evolution. PBAC's September 2021 recommendation specified that any outcomes-based RSA should encompass rebates for the cost of treatment over at least five years post-listing in circumstances where patients die, are placed on invasive permanent ventilation, or require subsequent pharmaceutical benefits scheme-subsidized treatment with nusinersen or risdiplam. While the final agreement between the Commonwealth and Novartis remains confidential, PBAC's published recommendation provides insight into the outcome-based framework being considered.
Australia's increasing adoption of outcomes-based contracting offers a pragmatic pathway for breakthrough therapies that might otherwise face rejection in more rigid markets. Companies with substantiated European innovative payment structures—such as Italy's staged payments or Germany's outcomes-based rebates—can leverage these precedents in Australian negotiations. With its transparent PBAC processes and established registry infrastructure, Australia is an attractive early-access APAC market where successful outcomes-based agreements can build regional credibility.
From local success to regional blueprint
Reforms in Korea and Australia are important for two reasons. First, the direct benefits are clear: faster Korean approvals through parallel processing, protected global pricing via expanded confidential pricing structure, and Australian reimbursement for high-cost therapies through outcomes-based agreements aligned with value-based pricing.
Second, the strategic implications extend beyond these two markets. Policymakers in other HTA-based APAC markets are studying Korea and Australia as reference models. Mechanisms now proven in these markets—outcomes-based contracting, confidential discounts, and parallel regulatory pathways for innovative drugs—can be leveraged for adoption during market access negotiations.
Manufacturers that successfully navigate Korea and Australia's reformed systems demonstrate the effectiveness of innovative market access approaches. They establish proof points that can shape policy discussions regionwide.
For manufacturers, the imperative is clear: actively document and disseminate these successful implementations through regional forums and policymaker engagement to influence emerging HTA systems toward more flexible, innovation-friendly frameworks rather than restrictive approaches of the past.
Joshua Siow is a partner at Simon-Kucher, Singapore; Lauren Chang is a senior manager at Simon-Kucher, Seoul
References
1. Pharmaceuticals - South Korea. Statista.
2. Health Technology Assessment Policy and Methods Review. Australian Government Department of Health, Disability, and Ageing. December 2, 2024., 2024.
3. Health Technology Assessment Review Implementation Advisory Group. Australian Government Department of Health, Disability, and Ageing. October 12, 2025.
4. National Health Amdendment (Cheaper Medicines) Bill 2025. Commonwealth of Australia Explantory Memoranda.
Newsletter
Lead with insight with the Pharmaceutical Executive newsletter, featuring strategic analysis, leadership trends, and market intelligence for biopharma decision-makers.
Related Content
