A cost-effectiveness approach to drug subsidy and pricing in Australia

The Australian government offers its citizens subsidies on a select list of pharmaceuticals. For a drug to qualify for inclusion on this list, its man ufacturer must demonstrate that the drug is both clinically effective and c ost-effective. In part, this measure, along with others, was introduced to improve clinical and economic outcomes. Although this evidence-based system has provided transparency and consistency in decision making about which d rugs will be covered, it may not have contained the rate of increase in dru g costs.