Policy Effectiveness in Managing Drug Shortages: Evidence From South Korea (2015–2024)

Abstract

Drug shortages represent a growing policy challenge for healthcare systems worldwide. This study investigates actual drug shortage events in South Korea from 2015 to 2024, using a “Shortage Occurred vs. Shortage Non-Occurred” framework to distinguish real-world disruptions from administrative classifications. National regulatory and industry data were analyzed using χ2 tests and trend evaluations to assess shortage patterns and evaluate the effectiveness of government monitoring policies. Results revealed a 2.7-fold increase in drug shortages after 2020, with permanent supply cessations being the dominant cause, especially among economically vulnerable categories. Monopoly and limited-supply drugs experienced the highest shortage occurrence rates, despite being pre-designated for regulatory monitoring. Recurrent shortages were particularly concentrated among Market Retention Drugs, suggesting persistent economic disincentives for manufacturers. Oral formulations were most affected, but formulation type was not statistically associated with increased risk. Inclusion in national supply management lists showed no significant preventive effect on shortage trends. These findings highlight the limitations of designation-based supply policies, which have not prevented shortages in key drug groups despite formal monitoring efforts. Instead, the study supports the need for targeted financial interventions—such as price adjustments and production incentives—to address supply risks for essential, low-margin medicines. Strengthening centralized monitoring and improving coordination may also improve early detection and response capacity. By focusing on actual shortage outcomes rather than regulatory compliance, this study offers new insights into the structural limits of current monitoring frameworks and provides evidence to inform more effective policy approaches in South Korea and other health systems facing similar challenges.