Current Market Trends
Population: 51 Million (2015)
GDP*: USD 1.411 trillion (2016 estimate)
Currency: Korean Won (W)
Current issues facing the medical device industry in South Korea include reimbursement pricing and the new healthcare technology assessment system for medical devices. The U.S. Embassy in Korea works closely with partners to ensure that U.S. medical device industry interests are represented.
Medical Devices and Equipment
Unit: USD thousands
Total Market Size
Total Local Production
Imports from the U.S.
Exchange Rate: 1 USD
Total Market Size = (Total Local Production + Total Imports) – (Total Exports)
Source: Korea Medical Devices Industry Association, KMDIA
Note: *2014/**2015: Due to the appreciated exchange rates (est.), statistics in USD have decreased although statistics in Korean Won increased.
The Korean medical device market is estimated to reach USD 5.1 billion in 2017. U.S. medical device manufacturers carefully watch government pricing and reimbursement policy as Korea grapples with cost containment under its national healthcare system.
The importation of medical devices requires the assignment of an importer or representative based in Korea to manage medical device approvals and to ensure regulatory compliance. As part of pre-market approval requirements, the Government of Korea requires testing reports on safety and efficacy. In addition to medical device approvals, companies also need to negotiate pricing terms with the Korean Health Insurance Review & Assessment Service (HIRA).
All domestic and foreign medical devices are subject to pre-market licenses from the Ministry of Drug and Safety (MFDS, formerly KFDA).
Distribution/Business Practices/Key Competitive factors
Medical devices are distributed mainly through local distributors. A local distributor may directly cover the whole country on an exclusive basis or a master distributor may contract with other regional sub-dealers for sales nationwide.
Sales leads for medical devices in Korea are normally created through steady communication with local subsidiaries or between distributors/commission agents and physicians on an individual basis. Local representatives call on physicians frequently and provide information on products to maintain good relationships.
One reliable distributor to cover the country on an exclusive basis is highly recommended for the Korean market since Korea is a geographically small country, and major users for high end medical devices are limited to general hospitals and university hospitals. More than one distributor often confuses clients in terms of representation and prices and diminishes the reliability of the foreign supplier.
Korea depends on high-end medical devices from the U.S., EU, and Japan, to supply about 60 percent of total market demand. Korean companies manufacture comparatively lower-end (mid-technology) medical devices.
Currently, the United States has largest import market share in Korea, followed by the EU and Japan.
In 2017, total imports of medical devices were estimated at USD 3.0 billion, with U.S. imports totaling over USD 1.4 billion. While U.S. market share represents approximately 47 percent of the import market, demand for foreign advanced and innovative medical devices showed relatively slow growth in 2017.
All medical devices are required to obtain marketing clearance from the Ministry of Food and Drug Safety (MFDS) before they are manufactured in or imported into Korea. As of April 8, 2012, Korea Good Manufacturing Practice (KGMP) certification is required at manufacturers’ sites overseas (Class 3 and 4) or in Korea through their importers by documents (Class 2), depending on cases and criteria. KGMP certification should be obtained to apply for a pre-market license.
Currently, medical devices are classified into four categories in Korea depending upon technical attributes and product use. MFDS requires pre-market notification for class I devices and pre-market approval for class II, III, and IV devices. Class III and IV devices must pass the most stringent technical review by MFDS with authorized labs to prove their safety and effectiveness. Since MFDS issues product licenses only to locally based firms, all foreign suppliers must submit required documentation and receive necessary approvals through their Korean importers, or U.S. supplier’s corporation located in Korea.
The lead-time for approval is typically 6 to 12 months, including company-working time for preparing applications. Although MFDS indicates its requirements for the approval in relevant regulations, specific detailed requirements could be different according to each product item. Thus, U.S. firms should closely work with their Korean importers to determine MFDS’s requirements on a case-by-case basis to obtain approvals.
Korea has a compulsory national healthcare system, called National Health Insurance (NHI) System :
(Over 97.5% of citizen in Korea pay a premium and have the right to access to any physicians and medical institutions. The remaining 2.5% of the population are covered by a Medical Aid Program for the poor.)
National Health Insurance Program & Reimbursement pricing
Korea has compulsory National Health Insurance (NHI) system for 50 million citizens. The NHI system was introduced in 1977 and covered entire population by 1989. The Korean government administers funds, coverage, coding, payment and pricing.
Due to the Korea-US Free Trade Agreement (KORUS FTA) implemented on March 15, 2012, tariffs of the most imported medical devices in Korea received duty-free treatment.
Name: Korea International Medical & Hospital Equipment Show 2018
March 15-18, 2018
Convention & Exhibition Center (COEX), Seoul, Korea
KIMES is a total healthcare related show. It is the largest showcase for medical devices and technologies in Korea. The range of exhibits at KIMES include consultation, diagnosis central supply, clinical examination, hospital accommodation, emergency equipment, radiology, medical information system, surgical apparatus, oriental medicine, cure apparatus, pharmaceutical, physiotherapy apparatus, obesity cure, healthcare, ophthalmic apparatus, medical device component, medical service, dental apparatus, disposable apparatus and others.
Korea Medical Devices Industry Association (KMDIA): http://eng.kmdia.or.kr/
U.S. Commercial Service Contact Information
Name: Yoon-shil Chay
Position: Senior Commercial Specialist
Best Prospects [from the CCG if healthcare is listed]
The following were the top 10 medical devices imported to Korea in 2016:
Healthcare spending (including investment)
... as percent of GDP: 7.4%
Hospitals, Procedures, Healthcare Professionals
Number of hospitals (including small clinics): 49,515 (2015 HIRA)
…Public: 220 (Ministry of Health & & Welfare, 2016)
Number of hospital beds: 652,734 (2015 HC Big Date Open System, HIRA Korea)
... available beds per capita: 0.012 (2015)
...of which in general hospitals: 144,803 (2015)
...of which in specialized clinics and rehabilitation centers: 429,215 (2015)
Physicians: 95, 076 (2015 HIRA)
...of which surgeons: 5,739 (2015)
...of which internists: 13,873 (2015)
...of which pediatricians; 5,282 (2015)
Dentists: 24,469 (2017)
Population: 51 million (2015)
Life expectancy men/women: 79.0/85.2 (2015)
Infant mortality: 2.7 per 1,000 live birth
Percent of population older than 65: 13.1% (2015)
...projection, 2030: 32.3% (2015)
Annual deaths: 275,895 (2015)
...caused by [Cancer] 76,855 (2015)
...caused by [Cardiac disease]: 28,326 (2015)
Prevalence of [Pneumonia]: 24,455 (2015)
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