A legal revision, which will go into effect on Dec. 23, will obligate medical institutions and pharmacies to pay drug prices to suppliers within six months of purchase.
The government, however, is moving to exempt buyers with the annual purchase of 3 billion won ($2.65 million) or less from the mandatory early payment. This is because these relatively smaller customers can hardly be seen to be in superior positions to the suppliers of medicinal products.
An official at the Pharmaceutical Affairs Division of the Ministry of Health and Welfare (MOHW)보건복지부 said so in a meeting with reporters recently.
“The ministry is screening regulations before the implementation of the law on Dec. 23,” the official said. “As soon as we finish the screening, we will put to prior notice the revision on Pharmaceutical Affairs Law.”
“The revision limits the payment period to six months, and the related organizations have to pay interests of 20 percent if they don’t meet the time,” he said. “The government can send corrective orders to medical organizations that don’t keep the deadline and if they fail to carry out the order, can suspend their business.”
The revision will spell out institutions to be exempt from the rule.
Initially, the ministry had planned to exempt from the early payment scheme the cases in which buyers who specify the payment date in a written form through public bidding, as well as hospitals and pharmacies whose drug purchase a year do not exceed 2 billion won,
However, it later decided not to allow exemptions for those who specify payment date, and readjust the minimum transaction amount from 2 billion to 3 billion won, the official said.