Advanced Guide to Entering the Korean Market (Part II): Strategic Pathways for Chinese Medical Innovators

Export to South Korea: Sales Edition

South Korea’s medical product sales system is highly similar to that of China, relying on distributors and dealers for sales. Unlike the direct sales model prevalent in the United States and most of Europe, where intermediaries are largely absent, South Korea operates as an indirect sales (distribution) market.

Although the systems are similar, the distribution landscape in the South Korean market is more concentrated compared to the multi-centric Chinese market. It is essentially divided into two parts: the Seoul metropolitan area and regions outside Seoul, each accounting for nearly half of the market volume.

This means that selecting high-quality Korean distributors for partnership is a critical step in expanding into the South Korean market.

Distributors in different regions or specialized fields each have their own strong distribution channels, so most foreign companies collaborate with multiple regional distributors in South Korea. For some highly specialized products, partnering with a single national distributor may be sufficient; however, in most cases, a more practical approach is to engage one distributor covering the Seoul metropolitan area, supplemented by one or two regional distributors covering areas outside Seoul.

This sales model is easy to launch and manage. Therefore, we also recommend that medical companies newly entering the South Korean market first test the waters by collaborating with local dealers or established distributors, before considering further investment in building their own teams and channels.

Distributors’ practical operational experience in relevant therapeutic areas is also a critical selection criterion. With a local team dedicated to the healthcare industry for many years, Vancrea Plus can assist medical enterprises expanding overseas in screening distributors specialized in different professional fields and customizing sales strategies.

Furthermore, we recommend that the initial cooperation period with South Korean distributors should last at least two years, and that exclusivity be considered within a defined scope. This approach allows distributors sufficient time and incentive to leverage high-quality resources for market development, while also providing the enterprise with a solid basis for evaluating the distributor’s commitment and capabilities.

How Should Distribution Targets and Performance Metrics Be Set? We believe they should be established by taking into account the specific size of the overseas market and leveraging readily available, clear system data such as reimbursement records. For new innovative product categories, VentureBlick recommends presetting targets based on the following proportions of the product’s global market share: 2% for South Korea; 0.1% each for Singapore, Indonesia, and the Philippines; and 0.3% for Thailand. It is also common practice to stipulate a minimum purchase volume for the first year in the contract.

South Korea Market Penetration

Some companies are also concerned about market saturation in South Korea. However, consider the following: prior to the pandemic, South Koreans visited hospitals an average of 21 times per person annually; life expectancy in South Korea reached 83.5 years in 2023 and continues to rise; and four hospitals from Seoul, South Korea, ranked among the top 45 “Best Hospitals in the World” in 2024—the highest number among Asian countries. This indicates that both residents and healthcare institutions in South Korea are actively seeking better solutions to improve health outcomes.

If a product has already undergone clinical application or commercial operation in more advanced markets such as the G7 countries, this constitutes a clear competitive advantage in the South Korean healthcare market, although it is not a mandatory requirement. In South Korea, the vast majority of medical services are reimbursed through the government’s National Health Insurance annual budget. Therefore, once a product is approved and included in the government reimbursement system, having a pricing advantage over comparable products becomes particularly critical.

Overall, Chinese-made products still hold a pricing advantage over those manufactured in South Korea or other advanced markets. For healthcare systems like South Korea’s, where government reimbursement rates are high and cost burdens are surging due to a super-aged society, superior cost-effectiveness translates into more sustainable social security. Chinese enterprises should leverage their advantages in reliable quality and controllable costs to highlight the value of their products.

From the perspective of application trends, South Korea’s demographic structure closely aligns with China’s future development, and their healthcare philosophies are also similar. In addition to groundbreaking and disruptive innovations, products targeting lifestyle-related conditions such as depression and obesity, chronic diseases including diabetes, hypertension, and hyperlipidemia, as well as health care and nursing solutions for the elderly, have gained considerable popularity in South Korea in recent years. Furthermore, both China and South Korea possess rich and similar therapeutic approaches within the field of traditional Oriental medicine, with a broad user base. Healthcare solutions in these categories should actively explore opportunities to enter the South Korean market.

So, when should one begin engaging with Korean doctors and hospital users, other local partners, and even the general consumer base? Given the presence of many strong domestic and imported products in the Korean market, what communication approaches resonate most with these users amid numerous options, and which product attributes do they value most?

We recommend initiating product education and promotion among healthcare professionals six months prior to the anticipated market launch in South Korea. In particular, it is essential to identify local key opinion leaders (KOLs) who endorse and recommend the product, and to define the framework for collaboration with them, as their support is instrumental in enhancing your product’s industry reputation. Once regulatory approval is obtained, you should immediately engage local distributors to launch a more comprehensive product promotion campaign.

South Korea hosts numerous medical exhibitions, forums, and other industry events throughout the year. While participating in these activities can indeed facilitate contact with potential partners in South Korea and even other overseas markets, relying solely on chance makes it difficult to achieve a satisfactory return on investment. The key lies in strategically selecting which events to attend and determining the appropriate level and mode of engagement based on your business objectives, thereby maximizing the benefits gained.

For Chinese consumer health products to gain a foothold in the South Korean market, promotional activities targeting the general public may be conducted within regulatory limits, following foundational steps such as regulatory approval, distribution network establishment, and endorsement by medical experts. One of the most effective approaches is to leverage 24/7 online or television live-streaming shopping channels. South Korea’s e-commerce landscape is highly mature, with numerous such channels available.

Additionally, open innovation collaborations, technology licensing, and partnerships with local healthcare enterprises also serve as models for overseas market entry and penetration.

Wanchuang Puli is a government-licensed medical innovation accelerator in South Korea and the sole officially designated international market expansion accelerator in the healthcare sector, as appointed by the Korea Innovation and Startup Agency.We can match key resources to efficiently facilitate the implementation of your medical innovations in Korea, tailored to the specific needs of different enterprises and innovative solutions. This includes assisting in the selection and connection with suitable partners such as medical experts and distributors, as well as recommending more precisely targeted industry events and marketing strategies.