OBJECTIVES: We aim to present the empirical experience of new drug listing and reimbursement under Taiwan’s National Health Insurance (NHI), and to analyze the performance of such mechanism. We also attempt to assess its impact to the research-based pharmaceutical company and the public access to pharmaceutical innovations. METHODS: The materials are based on the documentation of Taiwan’s NHI Drug Review Committee (DRC) over 11 years period (1996~2006). We defined the criteria of pricing methods into 9 categories: International Price Comparison, Comparison with Similar Products with Equivalent Therapeutic Effects, Price Proportion Method, Price Addition, Orphan Drugs, The Lowest Available International Price, Cost Analysis, Grouping and Others. RESULTS: The total number of new drugs that applied for NHI listing and reimbursement during 1996~2006 was 787, and the number of petition cases was 325(41%). The total number of new drugs with final pricing decisions in this study was 566. Among them, 298 items were issued with reimbursement price without petition, and the remaining 268 new drugs received their reimbursement prices after petition on initial pricing decisions. The approved price was averaged 74% of the international median prices, and was only 65% of international median prices among petition cases. The top three methods of pricing are Price Proportion Method (37.1%), Equivalent Therapeutic Effect with Similar Product (23.5%), and International Price Comparison (14.7%). Although NHI continues to facing financial crisis in the past 10 years, the price of reimbursement remained approximately 71% of their respective application prices during all the period. CONCLUSIONS: The policy direction of NHI pricing and reimbursement is to ensure that resources serve the highest priorities of the population’s health needs in an efficient way. It is worthwhile to evaluate whether the pricing and reimbursement decision of new drugs in Taiwan’s NHI to fulfill the transparency and the expectation of public benefits.