OBJECTIVES: To assess the impact of pharmaceutical part of the health care reform in Croatia as compared with trends observed in EU countries. METHODS: Detailed historical pharmaceutical expenditure was analysed using MIDAS, an IMS Health proprietary database, as well as a variety of other published secondary data sources. Croatian trends have been compared with those of a number of benchmark countries, categorised either as Peer Countries (Slovakia, Czech, Hungary) and Aspirational Countries known to have systems that have been ensuring excellent health care outcomes (France, Netherlands, Austria). RESULTS: Although total health expenditure in Croatia, as percentage of GDP is at EU level (7.8%), total pharmaceutical spend per capita is very low, 128€, with more than 80% coming from public funding. Pharmaceutical expenditure is not driving the overall health cost growth; in fact, pharmaceutical spend as a % of total health expenditure has been declining since 2003. The complex set of cost containment measures, including limitation of GP’s prescriptions, imposed by Croatian Health Insurance Institute is the likely cause of this trend. The most relevant finding of this study is that Croatia has been historically very low in drug use in terms of ‘volume per capita’ compared to benchmark countries. In 2010 Croatian patients consumed approx. 20-25% less prescription medicines per capita than the average of peer and aspirational countries. CONCLUSIONS: If the observed trends are allowed to continue, it will be difficult for Croatia to keep pace with its peers in providing adequate pharmaceutical health care standards and outcomes. Without close monitoring of key health care indicators and outcomes, volume (prescription) limitations introduced by the recent Healthcare Reform can have adverse and inevitable long term impact.