South Korea's Biopharmaceutical Exports Rank 7th Worldwide...139% Increase

Korea International Trade Association Institute of International Trade and Commerce Report
"Must Actively Utilize US Global Supply Chain Restructuring"

[Asia Economy Reporter Kim Heung-soon] In the wake of COVID-19, as establishing a stable supply chain for essential pharmaceuticals has emerged as a key task among major countries such as the United States and the European Union (EU), there is a growing argument that South Korea should actively leverage the opportunity to reorganize the global supply chain based on its competitiveness in the biopharmaceutical sector.

According to the report titled 'Changes in the Global Pharmaceutical Supply Chain and Analysis of Our Export Competitiveness' released on the 26th by the Korea International Trade Association's Institute for International Trade and Commerce, South Korea's biopharmaceutical exports last year recorded $5.1 billion, a 139.1% increase compared to the previous year, and its export ranking rose two places from 9th to 7th. In particular, the export competitiveness indicators have significantly improved since COVID-19, surpassing competitors such as the United States, the EU, China, and Japan.

Data provided by Korea International Trade Association

According to the supply chain analysis results announced by the White House in June, 73% of the United States' active pharmaceutical ingredient manufacturing facilities are located overseas, indicating a very high dependence on foreign sources for essential pharmaceutical supply chains and vulnerability to risks. Accordingly, the United States is promoting the reorganization of its supply chain by expanding domestic production of essential pharmaceuticals, securing stockpiles, and strengthening cooperation with allied countries. The report analyzed that this movement is likely to present a new opportunity for South Korea, which has manufacturing capabilities centered on biopharmaceuticals.

South Korea is recognized as a pioneer in the biosimilar field, leading the global market, and shows superiority in biopharmaceuticals over competitors such as the United States, China, and Japan in terms of export competitiveness, which is considered a positive factor. The report also expects that strengthening cooperation with allies such as the United States will have effects such as accumulating global capabilities of Korean companies, securing large new markets, and curbing China's pursuit.

Kim Kyung-hoon, a research fellow at the Institute for International Trade and Commerce, said, "South Korea possesses the world's second-largest biopharmaceutical production capacity and holds world-class manufacturing capabilities, having signed numerous vaccine and therapeutic contract manufacturing agreements with global companies." He added, "To establish itself as a global production base for advanced pharmaceuticals, South Korea should pursue more active open innovation, build a virtuous cycle structure of government support and private investment, and improve related regulations to promote new drug development."