Biohealth Industry Outlook Worsens Again, While Investment Expands

[NEWSMP] After presenting a markedly improved outlook for the biohealth industry last month, the Korea Institute for Industrial Economics & Trade (KIET) has once again revised its forecast downward.

On June 21, KIET released the Industrial Expert Survey Results: June 2026 Conditions and July 2026 Outlook.

According to the report, both the June current condition PSI (Professional Survey Index) and the July outlook PSI for the biohealth industry declined from the previous month.

The PSI is a quantitative indicator based on monthly surveys of expert panels comprising professionals from domestic financial institutions, associations, organizations, and research institutes, measuring their assessments of business conditions across major manufacturing industries.

The survey consists of three response options: improvement (expansion) compared with the previous month, no change, or deterioration (decline). Responses are converted into an index ranging from 0 to 200.

Accordingly, a PSI reading of 100 indicates no change from the previous month, while a figure closer to 200 suggests that respondents predominantly expect conditions to improve, whereas a figure closer to 0 indicates a prevailing expectation of deterioration.

In April, most major PSI indicators for the biohealth sector dropped significantly below 100, reflecting concerns about the U.S.-Iran conflict and drug price cuts.

However, last month, major PSI indicators rebounded into triple digits as sentiment improved driven by the government's launch of large-scale funds and positive developments from the American Society of Clinical Oncology (ASCO) Annual Meeting, underscoring the sector's volatility.

That volatility continued this month. Most PSI indicators for the biohealth industry declined from the levels reported in May after showing significant improvement the previous month.

In particular, the industry conditions PSI in June fell to 81, marking the second-lowest level this year after April.

Exports remained above 100 at 105, but domestic demand slipped to 95, returning to double-digits, while production declined further to 90.

In contrast, profitability rose from 91 in May to 110, surpassing the 100 mark for the first time this year. Investment, which had recovered to 100 in May, climbed further to 114.

Looking ahead to July, the industry conditions PSI decreased slightly from the previous month but remained in triple digits at 100. However, both domestic demand and exports dropped to 95, falling below the 100 mark.

Meanwhile, both production and profitability climbed to 100, marking a return to triple-digits for the first time in three months and four months, respectively. Investment strengthened further, increasing to 119.