1. Reason for revision

The Pharmaceutical Affairs Act has been revised (Act No. 20328; promulgated on February 20, 2024; implemented on February 21, 2025) to increase the additional monetary sanctions for unjust enrichment related to benefits for relief of injury from side effects of drugs, raising them from 2 to 5 times, in line with the Act on Prohibition of False Claims for Public Funds and Recovery of Illicit Profits. This revision provides forth the matters delegated by the Act and the matters necessary for its implementation.

In addition, the revision aims to provide a basis for reducing the burden on the industry by temporarily excluding shortage prevention drugs that are necessary for patient treatment but which the industry is reluctant to produce due to economic reasons from those subject to the payment of dues for "charges for relief of injury from side effects of drugs."

2. Main contents

a. Regulation of additional monetary sanctions for unjust enrichment related to benefits for relief of injury from side effects of drugs (Article 17-2 of the draft).

The revision stipulates the additional monetary sanctions for unjust enrichment related to benefits for relief of injury from side effects of drugs, as prescribed by the Presidential Decree of the Pharmaceutical Affairs Act.

b. Temporary (2-year) exemption from charges for relief of injury from side effects of drugs for shortage prevention drugs (Newly established Subsection (b) 4 of Appendix 1 of the draft).

The revision aims to reduce the burden on the industry by temporarily excluding shortage prevention drugs from among those subject to payment of “charges for relief of injury from side effects of drugs.”

c. Following the revision of the Pharmaceutical Affairs Act (Act No. 20328, February 20, 2024), which abolishes reexamination and integrates the post-marketing drug safety management system into a risk management system, the referenced provisions have been corrected accordingly (Subsection (c) 1 of Appendix 2 of the draft).