Skip Navigation
Menu
Close

Health

"Kim & Chang’s substantial practice is a popular choice for international pharmaceutical companies."
– The Legal 500 Asia Pacific 2018

Overview

Our Health Practice brings together the firm’s unparalleled regulatory, intellectual property, corporate, competition law and litigation expertise to meet the complex needs of our clients in the pharmaceutical, animal health, medical device, diagnostics, food and beverage, and cosmetics and personal care products sectors. 

Formed when our firm was first established in 1973, our Practice has since advised the great majority of multinational firms in these sectors that do business in Korea, from established industry leaders to newer biotech companies and start-ups.

Our expertise and experience have won the respect of regulators and other government and law enforcement agencies, which in turn provides us with multiple channels of communications with government. Our knowledge of how regulatory agencies work and how the relevant laws and law enforcement trends have evolved allow us to advise clients proactively on a wide range of issues, from the legality of specific promotional practices, product approval and pricing to product recalls, anti-counterfeiting strategies, advertising claims and regulatory compliance.

Our highly experienced team, comprised not only of attorneys but industry specialists and numerous former officials of the Ministry of Health & Welfare (“MOHW”), the Ministry of Food & Drug Safety (formerly, the Korea Food and Drug Administration) (“MFDS”), and other government agencies have an in-depth, practical understanding of the commercial and regulatory aspects of these businesses that is unmatched in Korea.  This combination of multi-area expertise and on-the-ground understanding of the business allows us to quickly grasp what clients want to achieve, identify the key issues, and craft customized, innovative solutions designed to achieve our clients’ objectives in the most cost-effective way.

Key Servicesshow

In addition to traditional legal issues, the most dynamic areas of our Practice in recent years include the following:

 

Compliance and Defense

Compliance

We regularly advise companies on compliance with the Pharmaceutical Affairs Law, the Medical Device Law, the Cosmetics Law, the Food Hygiene Law, and the Monopoly Regulation and Fair Trade Law, particularly with respect to advertising and claims, adverse reporting, KGMP and KGSP, and product recalls.  We also represent companies in investigations and enforcement actions by the health authorities, competition authorities, and police/prosecutors’ offices.  As regulatory violations may also carry criminal penalties, an important focus of our work is to minimize the risk of criminal liability.

 

Internal Investigations

Today’s heightened enforcement environment means companies need strong internal control to ensure compliance on the part of employees.  Our Practice frequently designs and carries out internal investigations for numerous purposes, including regular, periodic reviews to ensure compliance, ad hoc reviews triggered by allegations of non-compliance, especially by “whistle-blowers,” or in preparation for government investigations.  We also assist in developing dawn raid manuals and advise on dawn raid preparedness.

 

Interactions with Healthcare Professionals

The healthcare industry has been a frequent target of investigations and enforcement actions by a number of government agencies which are actively enforcing laws that prohibit the giving of improper benefits to healthcare professionals, most recently under the dual punishment system.  This focus by the Korean government has been accompanied by increasing scrutiny by the media and NGOs.  Our Practice has unrivalled experience in advising on these laws and regulations, in crafting internal codes of conduct, employee training, and representing companies in government investigations and enforcement actions.

 

 

Pricing and Reimbursement

Obtaining Pricing and Reimbursement

We regularly advise pharmaceutical, medical device and diagnostics clients on strategies for optimal reimbursement prices for newly listed drugs under Korea's National Health Insurance Act and reimbursement guidelines. In recent years the Korean pricing and reimbursement system has undergone significant changes. Companies seeking reimbursement listing for new products must first submit to a pharmaco-economic assessment by one government agency and thereafter negotiate prices with another.  Further, the government is under increasing pressure from shortfalls in insurance financing to limit reimbursement.  As a result, it is more difficult than ever for clients to obtain prices that reflect the true cost of innovation.  Our Practice’s attorneys and former pricing regulators draw on their extensive experience to help clients successfully and efficiently navigate the complex pathways for obtaining reimbursement listing and pricing.

 

Protecting Reimbursement Prices

Even after a drug is launched, numerous price adjustment mechanisms including price volume agreements, price-kickback linkage, price-patent linkage and others are in place that enable the government to cut reimbursement prices.  Due to pressures to reduce healthcare costs and minimize the budgetary impact on the national health insurance system, the government has been using these mechanisms vigorously.  We understand that maintaining fair pricing in one market is critical to our clients’ global business goals.  Our Health Practice has the experience and expertise to help manage a product throughout the entire span of its “price cycle.”  In this endeavor, we rely on the expertise of our IP department, which is Korea’s largest.

 

 

Transactions: M&A, Business Alliances, and Restructuring
 

Our Health Practice brings our firm’s unrivaled expertise in all aspects of M&A to advising our clients in respect of mergers, acquisitions, spin-offs, joint ventures, and business integrations – in carrying out due diligence, negotiating agreements, structuring the transaction, and obtaining necessary government approvals.  Often in mergers among pharmaceutical companies, product registration and reimbursement pricing considerations will be key in driving the structure or sequencing of the process.  In addition to general transaction advice, our Practice advises on such issues as corporate restructuring, partial business withdrawal, the integration of Korean operations pursuant to a global merger, the buying out of minority shareholders, and the closure or relocation of manufacturing plants and/or regional sales/distribution centers. 

Alliances between multinational and local companies are increasing in number and complexity, as companies work to navigate rapidly changing regulatory and business environments.  We are seeing more and more complex licensing, distribution, co-marketing, co-promotion, and investment arrangements.  We have extensive experience providing strategic, as well as legal advice on the formation and management of various forms of business alliances and handling of relationships with business partners.

 

 

Product Approvals

Clinical Testing

Proper planning and management of clinical testing are increasingly important in obtaining product approvals and reimbursement prices. Our Health Practice regularly assists clients in developing, reviewing, adapting and obtaining approvals with respect to pre- and post-marketing clinical trial protocols by reviewing statutorily required data on safety and efficacy and GCP compliance.  We also advise on measures to protect against liabilities which may result from the use of new medications and therapies, medical devices, and in vitro diagnostics on participants in clinical trials

 

Product Approval Applications/Changes

Former MFDS drug application examiners on our Practice are industry experts in advising companies on how to put together the application dossier for pre-market approval by reviewing technical files, test results, GMP assessments and clinical trials.  Our Practice also routinely trouble shoots for clients when they meet with obstacles during the process of obtaining market approval or obtaining the reimbursement price.  We provide up-to-date information on recent practice trends of the MFDS’s product registration process and their effects on business. Furthermore, our Practice provides legal information pertaining to product maintenance including information on handling and distributing used products, upgrades to medical equipment, and overseas Good Manufacturing Practice (“GMP”) due diligence conducted by the MFDS for products manufactured overseas.

 

Restrictions on Who Can Register and on Transfer

Product approvals in Korea for pharmaceuticals, animal health products, and medical devices can be held only by Korean resident companies.  This means that multinationals must take special care when they appoint local distributors or terminate distributorships to “take their products back” or change distributors.  Further, constraints on the transferability of product approvals and reimbursement prices mean that companies need to plan carefully in advance to ensure that their reimbursement prices are not cut in the process of product approvals being transferred.  We routinely advise clients on these sensitive issues.

 

 

Labeling, Claims and Advertisements
 

Pharmaceutical, animal health, medical device, food and beverage, and cosmetics products are subject to strict labeling requirements as well as restrictions on the type of claims that can be made.  Many types of violations in this area carry criminal as well as administrative sanctions.  Our Practice has unparalleled expertise in advising on labeling requirements and the scope of permissible claims.  We successfully represent companies in proceedings brought by, for example, the MFDS or the prosecutors’ office claiming violations.

 

 

Product Integrity/Protection/Crisis Management

Licensing and Patent Protection

Successfully managing a product throughout its life cycle requires a comprehensive strategy requiring the integration of regulatory and intellectual property expertise.  Our Practice takes this multidisciplinary approach when advising clients on the licensing of technology, patents, and trademarks.  We work as a partner with our clients in the protection of patents and other intellectual property through vigilant enforcement and infringement actions.

 

Combatting Counterfeits

Counterfeit drugs have become an increasing threat to product integrity as the globalization of manufacturing and sourcing of product has accelerated.  We regularly advise clients on proactive approaches for detecting/preventing counterfeiting activity, including putting in place a taskforce on the ground to gather information, and building important working relationships with local government and customs authorities.  When counterfeiting is detected, we take a comprehensive, multifaceted approach – including, as necessary, notifying and working with regulators, communicating with wholesalers, hospitals, and pharmacies, and coordinating with the media - to help clients protect the integrity of their products and minimize any potential risk to public health.

 

Product Liability and Crisis Management

We advise on all aspects of product liability, from prevention to crisis management to defense in lawsuits.  For example, we help companies put in place proactive systems for handling product complaints effectively so that they do not develop into disputes.  We successfully advise companies on the appropriate positions to take with regard to official product inquiries sent by the courts in the context of medical malpractice lawsuits.  We assist companies in developing and implementing product recall programs as required and in communicating with local regulators.

Key Experiencesshow

Compliance and Defense
  • We have represented the majority of the multinational pharmaceutical and device companies that have been subject to investigations in recent years by the Korea Fair Trade Commission (KFTC), MOHW, MFDS, and police/prosecutors relating to interactions with healthcare professionals, including the three rounds of investigations into the pharmaceutical industry by the KFTC.
  • We have drafted and reviewed policies and SOPs and developed compliance training and enforcement programs for the majority of pharmaceutical and device companies that do business in Korea.
  • We successfully defended a number of pharmaceutical and device companies in regulatory/criminal proceedings involving allegations of false/exaggerated, medicinal or otherwise improper claims by cosmetics and food companies.
  • We successfully defended a pharmaceutical company against allegations of illegal advertising of a drug before product launch.
  • We assisted a pharmaceutical company in defending against product liability claims in respect of contamination that occurred during manufacture.
  • We successfully defended a pharmaceutical company from charges that certain services fees paid to physicians constituted illegal payments in violation of the Dual Punishment System.
 
Pricing and Reimbursement
  • We assisted a pharmaceutical company defend the reimbursement price of a drug’s primary strength when MOHW sought to reduce the reimbursement prices of all strengths of the drug.
  • We crafted a successful strategy to expand the reimbursement scope for an oncology drug without having to voluntarily reduce the reimbursement price of the drug as MOHW usually requires.
  • We have successfully advised numerous clients to obtain desired reimbursement prices for newly listed drugs that reflect the cost of innovation and defend against price cuts to already listed drugs.
  • We assisted a pharmaceutical company in obtaining expansion of the reimbursement scope (indications added), giving a larger patient pool access to the drug, without having to voluntarily lower the reimbursement price of the drug as MOHW usually requires.
  • We assisted a pharmaceutical company in successfully challenging in court MOHW’s decision to change first-line status of the client’s blockbuster drug to second line, establishing seminal administrative law precedents regarding standing and ripeness in the process.
  • Using policy-based as well as legal arguments, we successfully defended reimbursement prices of drugs for a number of companies against cuts based on allegations that improper benefits were given to healthcare professionals.
 
Transactions: M&A, Business Alliances, and Restructuring
  • We successfully advised a medical device company in terminating an existing distributor and establishing a joint venture with a new partner.  The existing distributorship was amicably terminated via an agreement under which the relevant product approvals were successfully transferred to the newly established joint venture.
  • We successfully defended pharmaceutical and device companies before the KFTC on allegations that they had unfairly terminated a distribution arrangement.
  • We successfully assisted a pharmaceutical company in closing and selling its manufacturing plant and shifting its business from local manufacture to the importation of finished product.
  • We advised a medical device company in the successful acquisition of its distributor in Korea and assisted with a wide range of post-closing matters.
  • We have carried out for numerous companies the integration of their Korean operations following global mergers.
  • We successfully advised a pharmaceutical company in investing in one of Korea's largest local pharmaceutical companies and entering into a business alliance with the Korean partner.  The project marks the first of its kind in the industry.
  • We assisted a multinational pharmaceutical company successfully take back product approvals for its products held by its local distributor, by structuring a transaction whereby the local distributor spun off part of its business into a separate joint venture company, in which the multinational pharmaceutical company acquired a majority stake.
 
Product Approvals
  • We advised a pharmaceutical company on the appropriate CRO contracting structure from a Korean regulatory and practical perspective and on the allocation of responsibilities and roles.  We reviewed the Master Service Agreement and Work Order contracting structure, safety reporting, site agreements, indemnity, informed consent and patient compensation.
  • We successfully settled on behalf of a pharmaceutical company a potential product liability claim for injuries allegedly resulting from taking part in a clinical trial.
  • We advised a pharmaceutical company on an appropriate legal and regulatory response to irregularities found in the course of the client’s GCP audit of clinical trial sites.
  • With regard to a voluntary recall request from the MFDS for finished products made with active ingredients not registered in the Drug Master File (DMF), we were able to successfully avoid a voluntary recall of the product by asserting there were no issues of safety, efficacy, or quality.
  • We successfully assisted a pharmaceutical company in overcoming regulatory hurdles with the MFDS to obtain product registration for its biologics product.
 
Labeling, Claims and Advertisements
  • We successfully advised a food company in an investigation by the prosecutor’s office into the possibility that the company made medicinal claims for a product through advertising, in violation of the Food Hygiene Act.
  • We have reviewed many labels for food and personal care products to meet compliance with labeling requirements.
  • We were successful in obtaining an injunction against a cosmetics company that was taking advantage of our client's high end brand image through advertising and promotional activities that included references to our client’s products.
 
Product Integrity/Protection/Crisis Management
  • We have overseen the listing of patents under the newly created Korean patent linkage system analogous to the US Orange Book system, helping close to 40 clients navigate the unique examination standards and procedures implemented by the MFDS.
  • We represented a consumer household products manufacturer in investigations by the KFTC relating to charges of false and exaggerated claims.
  • We have represented a number of cosmetics companies against product liability claims.

Professionals

Key Contacts

Insights

Search Professionals

EXPERTISE RESET SEARCH

EXPERTISE

레이어 닫기

EXPERTISE

Close

Share

Close