Government-Doctors Standoff... Fiery Telemedicine Stocks

Resident Doctors Protest Medical School Quota Expansion
Government Expands Telemedicine Nationwide
CareLabs, Ubicare Stocks Surge

The government decided to increase the nationwide medical school quota by 2,000 students starting from the 2025 academic year, but large hospital residents protested, causing a 'medical crisis.' To prevent confusion in the medical community, the government decided to temporarily expand telemedicine services nationwide. This is why telemedicine-related stocks have recently surged in the domestic stock market.

According to the financial investment industry on the 26th, CareLabs' stock price rose 52.4% from the beginning of this month through the 23rd. Considering that the KOSDAQ index rose 8.7% during the same period, the excess return compared to the market reached 43.7 percentage points. Not only CareLabs but also Ubicare and Inseong Information recorded high growth rates compared to the market, rising 47.4% and 27.4%, respectively, during the same period.

The expectation of benefits from the expansion of telemedicine led to the stock price increase. On the 23rd, Prime Minister Han Duck-soo stated, "We will take measures to fully expand telemedicine so that the public can receive general medical care more conveniently." Until then, the government had allowed telemedicine mainly for 'clinic-level' medical institutions and 'returning' patients. Only a very limited number of hospital-level or higher medical institutions were allowed.

There is a growing movement to institutionalize telemedicine to balance patient safety and convenience. Earlier, on the 30th of last month, the government announced the 'Digital Innovation Strategy in the Medical Field,' which includes plans to 'activate telemedicine' and expand the platform 'Health Information Highway,' allowing individuals to check their medical information.

CareLabs, Ubicare, and Inseong Information provide technologies and services to promote telemedicine. CareLabs owns 'Goodoc,' the nation's top healthcare platform, as a subsidiary. Goodoc offers location-based hospital search, reservation services, and limited telemedicine services within the scope permitted by current laws. Since the service launch, it has recorded 1 million cumulative medical users and 7.6 million cumulative subscribers.

A CareLabs representative explained, "Telemedicine can become an important competitive advantage in terms of digitalizing medical services," adding, "We look forward to the current government's digital healthcare regulatory reforms, including medicine delivery."

Ubicare develops solutions related to the medical information platform business. It provides an integrated management solution that informatizes all necessary tasks in the medical environment to maximize efficiency. It possesses the largest medical network in the country, connecting over 17,700 hospitals and clinics and more than 8,000 pharmacies. The electronic medical record system (EMR) 'Uisarang' currently holds the number one market share in the clinic EMR market.

Comprehensive IT service company Inseong Information operates the overseas Korean medical consultation platform 'OKDoc.' Through its subsidiary HighCareNet, it runs a remote patient monitoring (RPM) business. The HighCare RPM service is an insurance fee-based remote monitoring service platform that helps medical staff manage patients remotely.

A financial investment industry official said, "Since telemedicine is being fully allowed on a 'temporary' basis, the stock prices of related companies are experiencing high volatility," expressing concern that "once the medical crisis ends, the government may restrict telemedicine again."

However, considering the global trend of allowing telemedicine, there are also forecasts that regulatory easing will continue domestically, albeit at a slower pace. The government is also positive about the digitalization of medical services, which raises expectations for the growth of related industries. Earlier, President Yoon Seok-youl attended a public discussion on livelihood and said, "For the medical industry to develop, digitalization for telemedicine must have innovations that surpass the systems of leading countries to secure global competitiveness."