OBJECTIVE: To draft the guidelines for economic evaluation of pharmaceuticals which are intended to be listed on the benefit schedule. METHODS: MOHW of Korea decided to amend Official Notification to stipulate the use of economic evidence in the reimbursement decision in 2001. Health Insurance Review Agency (HIRA) has been in charge of developing draft guidelines for economic evaluation of pharmaceuticals. At the outset of drafting the guidelines, HIRA reviewed the existing international guidelines and other research papers to screen the key issues. Then, named individuals were invited to discuss the theoretically and practically controversial issues of this area and determine the direction of guidelines. After five consultation meetings, HIRA drafted the guidelines and asked advice from academia and industry. A Second draft was openly discussed at the workshop which was hosted by HIRA and the Korean Association of Health Economics and Policy. RESULTS: The guidelines comprise two parts, guidance and explanatory notes. According to the guidelines, all the pharmacoeconomic studies submitted to the HIRA should be done with social perspectives. With regard to the productivity cost, HIRA recommends excluding it in a base case analysis, and doing a sensitivity analysis or presenting the results including the productivity cost separately. CEA and CUA are the recommended approaches, and the final outcomes such as LYs or QALYs are welcomed. Uncertainty and generalizability are also important issues in HIRA guidelines. CONCLUSIONS: HIRA guidelines will be the first official pharmacoecnomic guidelines in Asia. For the upcoming two or three years, it will be voluntary for the companies to submit the economic evidence and practicability of the guidelines will be tested. With growing experience and theoretical development in this area, HIRA guidelines will be revised periodically.