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OECD Economic Outlook (2021.9; 2021.5); IMF World Economic Outlook (2021.4), KDI Dr. Young Wook Jang

Growth rate 2020

Growth rate 2021

Economic recovery in 2021

( Base year 2019= 100 )

The highest rate of economic recovery among major OECD countries in the recent 2 years

South Korea’s performance on COVID-19 response

South Korea

Norway

United States

Australia

Sweden

Denmark

Singapore

Eurozone

Germany

Japan

France

Italy

United Kingdom

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Active public participation on social distancing

Active public participation on social distancing without lock-down

Google Mobility, G-ABC Munkhzul

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Emergence of new Covid variants

It became difficult to go back to normal through vaccination after the advent of the Delta Variant

Redrawn from Centers for Disease Control and Prevention Internal Document

Case Fatality

Rate

Basic Reproduction Number

SARS-CoV-2 Omicron variant

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Korea’s COVID-19 Response Policy

1. Non-pharmaceutical interventions

Preventive measures on confirmed cases

and those who had contacts with them

Facility quarantining of confirmed cases, self quarantine of those who had contacts (Treat, Quarantine)
Contact tracing through epidemiological investigation (Trace)
Selective testing on the contacted and vulnerable groups (Test)

Preventive measure in population groups (restriction on person to person contact)

Restriction on private gatherings
Restriction on business operation hours
Restriction on assemble, and business

Blocking inflow from abroad

Personal hygiene (Mask wearing, hand washing)

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COVID-19 Vaccines

Korea’s COVID-19 Response Policy

2. Pharmaceutical intervention

80% of entire population, 90% achieved of adult vaccination, Booster-ed rate of 60% or more

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Classification of preventative policies

‘ Damage reduction’ & ‘Damage delay’

Recurring & continuing expense, broad societal damage

3T ( Test, Trace, Treat )

Social distancing

Damage delay

(Non-pharmaceutical intervention)

Effect

Vaccination

Development of

effective medical treatments

One-time expense, High cost effectiveness

Damage reduction (Pharmaceutical intervention)

Immediately applicable

Difficulty in immediate application/ deployment due to issue of vaccine supply, and delay in development of medical treatments

Method

Cost

Possible application period

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Shifting the paradigm of Preventative policies

Unlimited cost

Prioritizing effects

Agreement and Understanding from the Public

Sustainability

Cost-

effectiveness

Procedural justification

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Directions of Getting Back to Normal

Measured & Gradual process

Mitigation in the order of living facilities, Large-scale events, and private gatherings as the vaccination rate improves

Aiming for an Inclusive Recovery

Focus on narrowing economic and social gaps and restoring people’s livelihood so that all citizens will enjoy the fruits of recovery

Active communication with the People

Actively collect extensive opinions to minimize the gap between the government’s plan and the public’s expectation

Launch of the Committee to Support a Return to Normalcy

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The Committee to Support a Return to Normalcy

Subcommittees

Managing Department

Ministry of Economy and Finance

Ministry of Education

Ministry of the Interior and Safety

Ministry of Health and Welfare

Co-Chair: Prime Minister & Nongovernmental Delegate

Economy & Livelihood

Society & Culture

Local autonomy & Safety

Quarantine & Medical care

Administrative Secretary:

Minister of Ministry of Health & Welfare

Minister of Ministry of Economy & Finance

Advisory Group

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Shifting the paradigm of Preventative policies:

The concept of Gradual return to Normalcy (Step by Step)

Socio-economic damage

shifting the damage

Actual

damage

Expected damage

Economic Loss

shifting the damage

Actual damage

Expected damage

Economic Loss

shifting the damage

Actual Loss

Economic Recovery

Before Vaccination

After Vaccination

Epidemiological damage

(confirmed cases & deaths)

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Inevitability of getting back to normal gradually (Step by step)

Emergence of the Delta Variant

Difficulty in managing crisis with vaccination only

Emergence of means to reduce damage

Vaccine is not perfect
However, it shows sufficient infection prevention effect and very high prevention effect of mortality through COVID

Increase in socio-economic damage

Concentration of damage cause by social distance in specific groups, equity

Limitations of damage reduction measures

Could the damage be further reduced if our society would be more patient with the current social distancing measures?
Psychological limitations of vaccine rates, and uncertainty with effectiveness of the treatment

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CORONAVIRUS

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Why is it impossible to lift all preventative measures?

If all preventative measures to be lifted, there will be a huge increase in infection

Newly reported cases�(maximum Rt=4.5)

# of confirmed cases

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Why is it impossible to lift all preventative measures?

25,000 severe cases occurred temporarily.

Prevalence of severe cases�(maximum Rt=4.5)

30000

20000

10000

# of severe patients

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Optimal

Scenario

45% reduction of reproduction #

Average

Scenario

40% reduction of reproduction #

Worst case Scenario

30% reduction of reproduction #

Realistic Scenario

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Individual prevention measures		Higher level of evidence	Lower level of evidence	Reduction in effectiveness
1	Quarantining confirmed cases	●
2	Self quarantining of close contacts	●
3	Mass testing	●
4	Contact tracing	●		●
5	Lockdown	●		●
6	Restriction on gathering		●	●
7	Restriction on business hours		●	●
8	School lock down		●	●
9	Blocking border		●
10	Mask wearing	●
11	Personal hygiene	●

Evidence of effectiveness of individual prevention measures

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The current social distancing policy is consisted of too many measures.

Private gathering		Up to 4 people until 18:00, up to 2 people after 18:00	Up to 4 people
Publicly used facilities	Prohibit on gathering	All types of entertainment facilities for adults (night clubs, bars, pubs, Korean style night clubs)	-
Publicly used facilities	Forced business open hour till 22:00	Karaoke, Restaurants, Coffee shops (until 21:00) Indoor gym, movie theater, PC room, Extracurricular academies (all public used facilities except for the prohibited places) *In case of going to a restaurant or cafe, up to 4 people can gather incase they are fully vaccinated (up to 21:00)	All types of entertainment facilities, karaoke, restaurant, cafe, public bath, swimming pool, and certain type of shops
Assemble/ mass gathering		Prohibited/ all types of mass gathering except for 1 person demonstration	Prohibition on mass gathering over 50 people
Sports events		No entry allowed	(in door) 20% of full occupancy capacity (Out door) 30% of full occupancy capacity
Religious events		10% of full occupancy, up to 99 people Prohibit on gathering, having meal together, and having night out meetings	20% of full occupancy capacity,, Prohibit on gathering, having meal together, and having night out meetings/ outdoor event up to 50 people

Level 4

Level 3

Impossible to assess the effect of each measure

Difficult to assess impact of each measure

(1.Prohibition of private gathering, 2. Limitation on business open hours, 3. Prohibition of mass gathering)

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Is social distancing effective to mitigate the spread of COVID-19?

Social distancing functions as minimal policy signal and actual effect has been observed. however, the size of the effectiveness decreased over time.

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Are effectiveness of preventative measures independent?

Result is

not independent

Beneficiary of each measure is different

Size of the effectiveness changes over time

Hard to assess independent effect of preventative measures

Reality of the effectiveness of these preventative measures

Ideal preventive measure design

Mask wearing

50% reduction on reproduction #

3T (Test, Trace, Treat)

50% reduction on reproduction #

Reproduction # (Re)

2.5

Reproduction # (Re)

1.25

Reproduction # (Re)

1.0

Basic reproduction # (R0)

Prohibition on gathering over 5 people

20% reduction on reproduction #

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Principles for return to normalcy

A combination of damage reduction strategy and damage distribution strategy

Damage delay strategy conveys large social cost

Maintain the damage reduction strategy

Persuade unvaccinated high risk group to be vaccinated
Vaccinate children and adolescents
Actively secure oral vaccines for COVID-19

Relief to the level corresponding to the # of intensive care bed, contact tracing capability
Mitigation of social distancing policy aligned with long term forecasting scenarios

Gradual, step-by-step easing of social distancing

Careful introduction of VACCINE PASS
Optimizing efficiency of contact tracing, and securing contact tracing capability

Establish system and infrastructure of safe return to normalcy

PRINCIPLE

principle

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CORONAVIRUS

principle

PRINCIPLE

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The essence of step-by-step return to normalcy- “Flattening the trend curve”

Both gradual mitigation are essential

02.

01.

Improve vaccine rate, dissemination of oral therapeutics

Both damage reduction strategies and damage distribution strategies can flatten the epidemic curve

# of confirmed case

# of severe patients

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Step by step - Gradual return to normalcy

To prepare for the normal scenario that predicts mass outbreak starting from March 2022, peaking on August 2022 (Highest number of case 25,000 confirmed case, ICU beds 3000 per day)
However, severe cases may decrease depending on the effectiveness of oral therapeutics.

Preparation of medical system and preventative measure capabilities according to the average scenario

daily recovery

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Step by step - Gradual return to normalcy

The vaccination rate is only a prerequisite to enter the new approach.

Korea has reached its realistic vaccination rate (82-83%)

It is necessary to evaluate various indicators to enter subsequent stages 2 and 3
There is a two-week lag between the surge in confirmed cased in surge in sever patients.

Conditions for entering the new approach

daily recovery

Bed reserve ratio of severe cases Severe case, deaths Size of the trend

111

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Step by step - Gradual return to normalcy

Present a roadmap to follow the optimal trend curve through following gradual and step-by-step easing of social distancing
Divide them into three stages according to prerequisites
Make sure to obtain at least 6 weeks (4+2) between each stages, assess mitigation impact
Plan to back to normalcy by Feb 2023, if entering the first stage by November

Find a ideal combination of preventative measures that will keep up with the optimal scenario

daily recovery

Increase vaccination rates and booster shots

Relief of restrictions on the basic-need related commerces

1st stage

Permission for public events

2nd stage

Relief of prohibition of private gatherings

3rd stage

Application of circuit breaker

Maintaining stage

Capacity of ICU bed, inpatient bed

Weekly # of severe patients, and deaths

Outbreak scale

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Step by step - Gradual return to normalcy

Possibility of large-scale outbreaks in the process of gradual return to normalcy
Necessity of safety measures due to political uncertainty
Preparation against the drastic increase of infection and the saturation of intensive-care-beds

Strategies for risk management [Circuit breaker]

daily recovery

Rapid increased utilization of intensive care beds and inpatients bed (75%)

Risk evaluation of outbreak trends

Condition

Major measures

Strengthening protection for unvaccinated people

Reinforcement of VACCINE PASS and temporary restrictions on private gatherings (4 weeks)

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Introduction of VACCINE PASS

Policy for getting back to normal gradually and safe

Korea has the structure for Vaccination certification

Social distancing applied depending on the vaccination status (2021.9 Seoul Metropolitan 4+2)

3:13 PM

Switch camera

Certified

(Completed, 14 days before)

3:13 PM

Switch camera

Certified

(1st, 14 days before)

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Principles for VACCINE PASS

COVID-19

CORONAVIRUS

Not applicable to essential social services (e.g. transportation, medical facilities, groceries, education facilities, office workplaces)

VACCINE PASS is a strategy to return to normalcy, not an additional restriction

VACCINE PASS is temporarily applied according to step-by-step return to normalcy then lifted according to the improvement of the pandemic situation

VACCINE PASS does not guarantee that the area of its application is free from COVID-19 infection

Vaccine�pass

application for newly deregulated high-risk facilities

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Consideration for VACCINE PASS

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CORONAVIRUS

Consideration for unvaccinated people

Selection and focusing

Gradual mitigation of the use of VACCINE PASS according to preventive measures

Continuous evaluation and its reflection on the application

Vaccine�pass

not recommendable to apply to all multi-use facilities but to facilities that are high-risk but manageable (cost-effective)

not as a mean of strengthening social distancing for unvaccinated people
Opportunities for vaccination and confidence in safety

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Epidemic curves after the lift of 2021

Start of the stepwise recovery

Circuit breaker

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Why did we fail?

The delta variant was still fatal.

ICU capacity was quickly saturated.

The effectiveness of the two doses of the vaccine was drastically reduced.

The need for 3 doses was overlooked.

However, gradual relief was not achieved, and abrupt lift was implemented.

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Omicron wave of Korea

Actual # of

confirmed cases

Moving average

Prediction date: Feb 3

Prediction date: Feb 28

Prediction date: Feb 16

Prediction curve: Mar 12

Prediction curve: Mar 12 (lower limit)

Prediction curve: Mar 12 (upper limit)

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Omicron wave of Korea

Actual # of

severe cases

Predicted # of

severe cases

Predicted # of

severe cases (lower limit)

Predicted # of

severe cases (upper limit)

# of

Occupied beds

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Reduced vaccine effectiveness due to Omicron variant

Omicron variant compromises effects of vaccines and reduces protection

UKHSA. 14. Jan. 2021

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Reduced vaccine effectiveness due to Omicron variant

Omicron variant compromises effects of vaccines and reduces protection

UKHSA. 14. Jan. 2021

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Reduced vaccine effectiveness due to Omicron variant

Omicron variant compromises effects of vaccines and reduces protection

UKHSA. 28. Jan. 2021

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Reinfection rate of Omicron variant

Omicron infects more people with preexisting immunity (10% of total)

UKHSA. 28. Jan. 2021

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Quicker spread of Omicron variant

Relative transmission capacity (in comparison to Delta variant)

The increase of reproduction number and the reduction of vaccine effectiveness are observed

Transmission capacity = (basic reproduction number X reduction in vaccine effectiveness)

Transmission capacity estimated to 120-150%

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Severity of Omicron variant

NEJM, 2022. 2. 17.

Intrinsic severity reduction of 25% in comparison of that of Delta variant

Severity reduction effect due to additional vaccination and reinfection

Identify the denominator when comparing figures!

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‘Damage reduction’ and ‘damage delay’ elements for epidemic prediction

relative increase in transmission capacity and decrease in diagnostic rates

VACCINE PASS

Social distancing

Damage delay (non-pharmaceutical intervention)

3rd vaccinations

oral vaccines

considering the introduction of oral vaccines, its quantity and application

Damage reduction

(pharmaceutical intervention)

drastic change from February

3rd dose vaccination completion for 60 years or older in January �3rd dose vaccination completion for under 60 years in March

measures

effect

agenda

COVID-19

3T(PCR, contact tracing)

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Omicron variant spread - predictive model

Modeling with real-time data

3rd vaccine, relatively high level of spread, social distancing taken into consideration

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Prediction result (Feb 19, critical patients)

Severity as 40% of Delta variant, 3rd vaccination preventive effect as 90%, oral vaccine taken into consideration

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Expected effect of oral vaccine

PAXLOVIDTM - 89% reduction in hospitalization and severity when administered within 5 days

Patient disease status in ICU	Base	Low	High	Reference
Number of hospital beds	25000
Number of ICU beds	2000
Average length of hospitalization for COVID-19 patients	13	10	16
% of test positive patients who has underlying diseases	33%	1%	45%
Efficacy	Base	Low	High
Hospital admission rate reduction by molnupiravir	30%	10%	50%
Hospital admission rate reduction by paxlovid	89%	66%	95%
Reduced length of hospitalization by molnupiravir	4	1	6
Reduced length of hospitalization by paxlovid	4	1	6
Reduced length of ICU by molnupiravir	4	1	8
Reduced length of ICU by paxlovid	4	1	8
Cost inputs	USD	Low	High
Health system operation cost per hospital bed day	$267	$136	$452
Health system operation cost per ICU bed day	$825	$550	$1,100
Cost of molnupiravir regimen (total 40 pills for 5 days)	$700	$700	$720
Cost of paxlovid regimen (total 30 pills for 5 days)	$700	$700	$720

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Expected effect of oral vaccine

15-55% of reduction in the # of inpatients / severely-ill-patients is estimated due to the introduction of oral vaccines

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Expected effect of oral vaccine

The overall cost-effectiveness of oral vaccine is confirmed

	Status quo	Mol: Reduced admission efficacy 30%			Pax: Reduced admission efficacy 87%
	Status quo	All adults	Age60over	Underlying disease	All adults	Age60over	Underlying disease
Effectiveness
Number of patients getting hospital care, when capacity is breached*	0	0	0	0	0	0	0
Number of patients getting ICU care, when capacity is breached	13,846	20,000	20,000	20,000	0	20,000	20,000
Hospital admission for all months	134,931	123,877	134,431	129,402	67,635	130,142	101,271
ICU admission for all months	6,268	5,774	6,250	6,020	13,527	6,113	4,787
Total admission	155,045	149,651	160,681	155,422	81,162	156,255	126,058
Averted total hospital/ICU admission by Mol/Pax efficacy		-11,548	-518	-5,777	-60,037	-4,944	-35,141
Additional hospital/ICU admission when capacity is breached (due to 4 days reduced recovery time by Mol/Pax)		6,154	6,154	6,154	-13,846	6,154	6,154
Net total hospital/ICU admission by Mol/Pax given the health systems capacity**		-5,394	5,636	377	-73,883	1,210	-28,987
Cost (in million USD)
Drug cost	NA	$144M	$14M	$74M	$144M	$14M	$74M
Hospital cost	$477	$301M	$330M	$316M	$158M	$325M	$244M
ICU cost	$100	$74M	$78M	$76M	$98M	$78M	$64M
Net cost***		-$58M	-$156M	-$112M	-$177M	-$161M	-$196M

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Epidemic prediction: limitations?

Result is

not independent

Beneficiary of each measure is different

Size of the effectiveness changes over time

Hard to assess independent effect of preventative measures

Difficulties for epidemic prediction

Ideal preventive measure design

Mask wearing

50% reduction on reproduction #

3T (Test, Trace, Treat)

50% reduction on reproduction #

Reproduction # (Re)

2.5

Reproduction # (Re)

1.25

Reproduction # (Re)

1.0

Basic reproduction # (R0)

Prohibition on gathering over 5 people

20% reduction on reproduction #

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Principles for long-term return to normalcy

Combination of damage reduction and damage distribution strategies

Damage delay strategies have high social costs

Maintain the damage reduction strategies

Persuade unvaccinated high risk group to be vaccinated
Continue additional vaccinations
Actively secure oral vaccines

• Relief to the level corresponding to the # of intensive care bed, contact tracing capability

Mitigation of social distancing in line with long-term epidemic prediction scenarios

Gradual mitigation of preventive measures

Procedural justification of VACCINE PASS and adjustment of application targets
Establishment of a system for treating mild-level patients and for administering oral vaccines

Regulation and infrastructure for safe return to normalcy

PRINCIPLE

Principle

PRINCIPLE

COVID-19

CORONAVIRUS

Principle

COVID-19: Past, Present, Future