The National Health Insurance (NHI) Program in Taiwan is a mandatory government-run social insurance system cover 99% of the population. Since its inception in 1995, NHI has been facing the challenges of rapid increase on health care costs, particularly in 1998; nominal growth rate of NHI costs reached 11.4% per year. So many strategies have been introduced in controlling costs and in improving quality of care, and the Second-Generation NHI was implemented in January 1, 2013. Among them the pharmaceutical benefits and expenditures strategies were the most important reforms. The drug cost of NHI was about 4.4 billion USD in 2012, nearly 25% of total health insurance expenditure, and drug cost per capita was 204 USD. Over 18,000 drugs were listed in the Drug Price List, and average new drugs listed time was 144 days. The average growth rate on drug fees was 4.8% for recent 10 years. Many strategies had been introduced to control drug costs, such that : (1) Drug Price List was revised continuously based on setting reference prices for the drugs with same ingredients .The price was adjusted 9 times from 2000 to 2011.  (2) “Drug Expenditure Target” policy into practice in January 1, 2013. It control unreasonable drug fees rising, and make drug policy predictable to the pharmaceutical industrial in Taiwan. (3) other reform such as focused on efficient pharmaceutical benefits and payment systems, equity in pharmaceutical transactions, public participation and information transparency. However, these biggest reform are now high hopes that the launch of the NHI system. To improve the system even further, future challenge will be our motive to reform and also lead us to a new stage in health care.