[Victory by Design] "You Cannot Move the Goalposts After the Review"… Kwangjang Overturns Ministry’s Rejection Decision

First Trial Win in Lawsuit to Overturn Product Approval Rejection by Ministry of Food and Drug Safety
Court Rules, "Imposing Additional Requirements After the Fact Violates the Principle of Legal Reservation"

"We tried our best to meet the predetermined standards, but after the review is complete, you can't just suddenly move the goalposts."

Attorney Geumnang Park, co-leader of the Healthcare Group at Kwangjang, stated this during an interview with The Asia Business Daily on August 19, reflecting on recently securing a first-instance win in a lawsuit to overturn the Korea Ministry of Food and Drug Safety’s (MFDS) rejection of a product license application on behalf of a domestic pharmaceutical and biotech company. Attorney Park added, "While I acknowledge the MFDS's discretion and expertise, the key issue in this case concerned a normative value judgment."

Attorney Geumnang Park of the law firm Kwangjang is being interviewed by The Asia Business Daily at the Kwangjang office in Jung-gu, Seoul. Photo by Jo Yongjun

The rejected treatment by the MFDS is an autologous adipose-derived stem cell therapy that had been developed over approximately 16 years since 2005. In a Phase 3 clinical trial involving 252 patients, statistically significant results were achieved for both primary endpoints. However, since the initial application in August 2021, the MFDS twice rejected the application, citing insufficient clinical significance.

The biggest point of contention was the interpretation of clinical significance. The MFDS acknowledged the statistical significance observed in the Phase 3 trial but argued that clinical significance is a separate concept and demanded additional data demonstrating superiority, structural improvements, and long-term outcomes over existing treatments.

The Kwangjang Healthcare Group, comprised of Attorney Park, former Seoul Administrative Court presiding judge Attorney Gang Donghyeok (31st Judicial Research and Training Institute), former pharmacist Attorney Hwang Seyoun (9th Bar Exam), and genetic engineering major Attorney Jeon Hyeongmi (10th Bar Exam), meticulously examined the clinical trial protocol, statistical analysis plan, and minutes from the Central Pharmaceutical Review Committee, revealing that such standards were never predetermined. Ultimately, the court judged that, according to the text and structure of the law, clinical significance must be recognized if the pre-approved hypothesis in the Phase 3 clinical trial is statistically proven. The court also found that requiring superiority over existing drugs violated the principle of statutory reservation.

Predictability was also an issue. The MFDS argued it could demand new data and standards based on its broad discretionary power. In response, Kwangjang submitted as supporting evidence that the treatment had received Regenerative Medicine Advanced Therapy (RMAT) and Breakthrough Therapy designations from the U.S. Food and Drug Administration (FDA), and explained the structure of the clinical trial—ranging from hypothesis setting to endpoints, statistical analysis plan, decision criteria, and actual results—to the court in chronological order. The court agreed that, under the Pharmaceutical Affairs Act, only safety and efficacy are required, and not superiority to existing products, ruling that it is unacceptable to retroactively demand standards deemed unnecessary at the time of trial design.

This first-instance ruling is significant, as it confirms the principle that objective standards and predictability are required even in the exercise of the MFDS's discretion. However, with the MFDS appealing the verdict, the case has now moved to the appellate court. The logic of the first-instance decision itself is expected to provide practical guidance for domestic biotech companies preparing cell and regenerative therapies. Attorney Park commented, "Based on experience covering the full range of work faced by pharmaceutical and biotech companies—from R&D and clinical trials, to product licensing, insurance reimbursements, intellectual property, and various disputes—the key was to integrate scientific and legal issues into a single strategy rather than separating them."

This content was produced with the assistance of AI translation services.