On December 2, 2016, the anticipated amendments to the
Pharmaceutical Affairs Act and Medical Device Act of Korea came
into effect and similar amendments to the Medical Affairs Act,
which were passed by the Korean National Assembly on December 1,
2016, are expected to come into effect in the end of 2016 or early
2017. The following is a brief summary of the key amendments.
1. Amendments to the Pharmaceutical Affairs Act and Medical
A. Heightened Criminal Punishment
The amended Pharmaceutical Affairs Act and Medical Device Act
impose heightened criminal punishment against pharmaceutical
companies, medical device companies, distributors, wholesalers, and
medical professionals1 that give or receive illegal
economic benefits or "kickbacks" for the purpose of
promoting sales of their pharmaceutical products or medical
devices. Under the amendments, such a violation now carries a
criminal fine not to exceed KRW30 million or imprisonment of up to
three years. Prior to the amendments, violators were subject to a
criminal fine of up to KRW30 million or imprisonment of up to two
years. These heightened criminal penalties, however, will not be
imposed retroactively on violations that took place prior to the
effective date of the amendments.
B. An Important Implication of the Amendment - Arrest Without a
The Korean Criminal Procedures Act permits an arrest without an
arrest warrant if (i) there is probable cause to suspect that a
person is committing or has committed a criminal offense that may
be subject to imprisonment of three or more years, (ii) such person
is likely to destroy relevant evidence or flee (or has actually
fled), and (iii) the urgency of the circumstances makes it
impossible to apply for an arrest warrant. Therefore, because
illegal kickbacks subject the violator to possible imprisonment of
up to three years under the amendments, the law enforcement agency
now has the authority to make an arrest of violators that give or
receive illegal kickbacks without an arrest warrant. If an arrest
is made without an arrest warrant, however, the law enforcement
agency is still required to obtain the arrest warrant within 48
hours from the arrest.
2. Anticipated Amendments to the Medical Affairs Act
A. Heightened Criminal Punishment
The same heightened criminal punishment for illegal kickbacks
(i.e., criminal fine not to exceed KRW30 million or imprisonment of
up to three years) shall also be imposed on medical doctors
(including dentists and traditional medicine doctors) under the
Medical Affairs Act once it comes into effect, and the law
enforcement agency's ability to arrest violators without an
arrest warrant will equally apply.
B. Notice and Consent Requirement to Ensure Patient Safety and
In order to ensure the safety and autonomy of a patient in
receiving medical care, the amended Medical Affairs Act will
require medical doctors to provide a patient with a description of
any medical care to be performed and its possible side effects and
precautions, and obtain the patient's prior consent to such
medical care in writing. A violation of this requirement will be
subject to an administrative fine not to exceed KRW3 million. This
notice and consent requirement will take effect six months after
the date of promulgation of the amended Medical Affairs Act.
C. Details of Non-Reimbursed Medical Expenses to Be Made
In order to ensure the patient's right to know and promote
the patient's right to choose between medical institutions, the
amended Medical Affairs Act will authorize the Minister of Health
and Welfare to collect and analyze the current status of
non-reimbursed medical expenses by item, qualification and amount
for which medical institutions apply. The results of the analysis
may be made public and in case of analysis related to hospitals and
general hospitals, are mandatorily made public by the Minister.
This disclosure provision will take effect on the date of
promulgation of the amended Medical Affairs Act.
1 Medical professionals include doctors, dentists,
traditional medicine doctors, pharmacist, medical technicians,
nurses, and midwives.
Healthcare Legal Update, December 2016
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