Health policy and planning
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In China, 44.4% of total health expenditures in 2001 were for pharmaceuticals. Containment of pharmaceutical expenditures is a top priority for policy intervention. Control of drug retail prices was adopted by the Chinese government for this purpose. ⋯ Control of retail prices, implemented in isolation, was not effective in containing hospital drug expenditures in these two Chinese hospitals. Utilization, more than price, determined drug expenditures. Improvement of rational use of drugs and correcting the present incentive structure for hospitals and drug prescribers may be important additional strategies for achieving containment of drug expenditures.