OBJECTIVES: To cut the escalating costs for pharmaceuticals the responsibility for costs of outpatient prescription drugs was decentralized from the government in Sweden to the county councils in 2002. The study aims to investigate if the introduction of decentralized responsibility had an impact on the pharmaceutical cost development in Sweden. METHODS: Monthly sales data, on the pharmaceutical benefits scheme, PBS, to each county council was obtained for the period January 2000 to May 2005. Interrupted time series analysis was used to investigate the effects of the introduction of decentralized responsibility on pharmaceutical costs in both total sales and sales of prescription drugs within total and within the PBS. This was investigated both on country level and with comparisons between county councils with different budget models for the decentralized responsibility. The investigation is continuing. RESULTS: Analyses show that there was no significant change in the cost trend associated with the introduction of decentralized responsibility for costs of outpatient prescription drugs. The county councils' costs of prescribed drugs covered by the PBS were on three levels; 19.5 EUR/inhabitant in 2000 and 23.9 EUR/inhabitant in May 2005, the second 15.7 EUR/inhabitant in 2000 and 19.5 EUR/inhabitant in May 2005 and the third 3.6 EUR/inhabitant in 2000 and 6.0 EUR/inhabitant in May 2005. All county councils remained on the same level throughout the study period. The budget model for outpatient prescription drugs had no impact on the level of costs. When considering total drug expenditures including inpatient drug costs the three segments diminish and all county councils are gathered between 21.7 - 26.0 EUR/inhabitant in 2000 and 28.2 - 34.7 EUR/inhabitant in May 2005. CONCLUSIONS: Pharmaceutical costs increased despite the introduction of decentralized cost responsibility for drugs in outpatient care. The budget models had no clear impact on the cost trend.