In recent years there has been a large increase in the number of econo
mic evaluations of pharmaceuticals. Many of these studies have been co
mmissioned by individual pharmaceutical companies, in support of new o
r existing products. In 2 countries, Australia and Canada (in the prov
ince of Ontario), draft guidelines issued by the government have outli
ned the requirements for economic evaluations to be submitted in suppo
rt of requests for reimbursement (government subsidy) of particular pr
oducts. One consequence of the guidelines is that they clarify what is
required, and in specifying the procedure for submission of dossiers,
identify a clear audience for the economic evaluation. In contrast, t
he situation in Europe is diverse. A wide range of healthcare systems
exist, including national health services and more liberal systems, in
volving a wide range of insurers and providers. European countries als
o differ widely in their approach to the pricing and reimbursement of
pharmaceuticals. Because of this diversity, the nature, conduct and im
pact of economic evaluation in Europe is not clear. It is therefore di
fficult for pharmaceutical companies to develop appropriate strategies
for economic evaluation and for analysts to decide on appropriate stu
dy methodology. This article reviews the nature of any official guidan
ce or requirements for economic evaluation, the potential for use of e
conomic evaluation, the range of studies carried out and the identifia
ble impacts. There is currently no official guidance in any country, a
lthough some countries are considering issuing guidelines. In some cou
ntries there is official encouragement to pharmaceutical companies to
undertake studies, and where economic data have been presented they ha
ve been considered by the relevant committees. The potential uses of e
conomic evaluation vary widely from country to country. These can be c
lassified in terms of a potential role in undertaking national price n
egotiations, deciding on reimbursement status or copayment level, deci
ding on inclusion in local formularies or in treatment guidelines, or
in improving prescribing decisions. Approximately 80 economic evaluati
ons of pharmaceutical products have been conducted to date in Europe,
covering a wide range of clinical areas. There are relatively few exam
ples of identifiable effects of such studies. In part this is because
it is often difficult to assess the part played by various items of da
ta. Nevertheless, the overriding conclusion is that economic evaluatio
n of medicines is likely to be more relevant in Europe in the future.
The problem for the pharmaceutical industry is in determining when and
how.