In 1999, the Korean government made a drug pricing policy reform to improve the efficiency and transparency of the drug distribution system. Yet, its policy formation process was far from being rational. Facing harsh resistance from various interest groups, the government changed its details into something different from what was initially investigated and planned. So far, little evidence supports any improvement in Korea's drug distribution system. Instead, the new drug pricing policy has deteriorated Korea's national health insurance budget, indicating a heavier economic burden for the general public. From Korea's experience, we may draw some lessons for the future development of a better health care system. As a society becomes more pluralistic, the government should come out of authoritarianism and thoroughly prepare in advance for resistance to reform, by making greater efforts to persuade strong interest groups while informing the general public of potential benefits of the reform. Additionally, facing developing civic groups, the government should listen but not rely too much on them at the final stage of the policy formation. Many of the civic groups lack expertise to evaluate the details of policy and tend to act in a somewhat emotional way.