ABSTRACT
In this chapter, the study tackles the issue of drug franchising, one of the largest revenue sources at the providing unit level during the economic reform. The study deals with some significant restructuring of financial management at the providing unit level, resulting from increasing reliance upon revenue from drugs in the midst of transformation from government subsidy funding to franchise funding to the provision of medical care. It also discusses how the pricing system works, and what roles various policy actors play in the system. In addition, it provides an assessment on how successful policymakers were in attempts to change the formulae pertaining to wholesale/retail ratio, coupled with a host of policy options to control exorbitant user charges.
