Biohealth Industry Outlook Rebounds Sharply, Turns Positive

[NEWSMP] The business outlook for the biohealth industry, previously dominated by negative sentiment, has reversed sharply and turned overwhelmingly positive.

According to the “Expert Survey on Industrial Business Conditions: August 2026 Conditions and September Outlook” released by the Korea Institute for Industrial Economics and Trade (KIET) on August 23, key Professional Survey Index (PSI) readings for the biohealth industry rose into triple digits.

In particular, the outlook indices for exports and investment both exceeded 140, while the domestic demand index also climbed into triple digits, suggesting that concerns over the impact of drug price cuts are beginning to ease.

The PSI is a quantitative indicator based on a monthly survey of a panel consisting mainly of experts from domestic financial institutions, associations, industry organizations and research institutes, who are asked to assess business conditions in major manufacturing sectors.

The survey offers three response options: improvement(expansion) from the previous month, no change from the previous month, or deterioration (contraction) from the previous month. The responses are then converted into an index ranging from 0 to 200.

With 100 indicating no change from the previous month, a reading closer to 200 means that assessments of improvement are more prevalent, while a reading closer to 0 indicates that assessments of deterioration are dominant.

According to the report, the PSI for overall business conditions in August reached 124, its highest level of the year, returning to triple digits for the first time in seven months since February.

The export PSI also climbed to 124, helping drive a more positive assessment of the biohealth industry, while the investment PSI rose to 114.

In addition, the PSIs for production and profitability both rose above 100 to 105, while domestic demand stood at 100, indicating a balanced assessment.

The outlook for September was similarly positive, with the PSI for overall business conditions at 124 and the export and investment indices both surging to 143.

With export demand remaining robust despite the decline in the exchange rate and the concentration of investment in AI beginning to ease, investment in the biohealth industry is expected to expand.

The PSIs for production and profitability both climbed to 119, while the domestic demand index also rose above 100 to 110.

A range of factors were cited as supporting the positive assessment of the biohealth industry.

Regarding current business conditions, experts said improving macroeconomic indicators and stronger investment sentiment had helped boost the industry, while exports and technology licensing deals were also expanding.

The view that the war in the Middle East was moving toward an end, along with the formation of a broader industry ecosystem as CMO businesses and new obesity drugs gained a foothold in the market, was also cited as a factor behind the positive assessment.

The positive assessment of profitability was attributed to increased exports. Despite the possibility of lower selling prices due to exchange-rate movements, experts believed that higher sales volumes would be sufficient to offset the impact.

For the September outlook, a shift in investment sentiment was cited as a positive factor, with attention and capital that had been concentrated on AI beginning to move toward healthcare.

However, generic drug price cuts were cited as the only negative factor in both the assessment of August conditions and the September outlook. At the same time, adaptation to the drug price reduction policy was mentioned as one of the factors underpinning the positive assessment.