Prior to patent expiry of a drug, the manufacturer will generally increase marketing efforts in order to maintain market-share. The introduction of generics will lead to strong competition, forcing the original patent holder to change their marketing strategy. These effects, together with other factors, (e.g. governmental price legislation) may lead to increasing drug expenditures. In order to increase price competition the Dutch government plans to modernize the drug reimbursement system, which is conceived to inadequately control drug prices. In particular, drug prices may not relevantly decrease due to lack of incentives for price competition. OBJECTIVES: To investigate the magnitude of effects on market-share and drug prices, we evaluated trends in drug volume and costs after patent expiry for enalapril, fluoxetine and ranitidine in the Netherlands. METHODS: Governmental price, volume and reimbursement policies were evaluated in order to provide a framework for developments after patent expiry. Drug use was measured as Defined Daily Doses (DDD) per 1000 population, derived from the InterAction DataBase, comprising pharmacies in the North of the Netherlands. Drug costs were calculated per DDD. Estimated trendlines for drug costs and share of drugs in the different trade-channels (specialité, parallel, generic) were compared. RESULTS: After the patent expired, costs per DDD - for enalapril, fluoxetine and ranitidine - decreased with 61%, 51% and 69% respectively. For enalapril and fluoxetine statistical significant differences in trendlines were found. For all investigated drugs, generic products rapidly took over the majority of the market-share (over 75%). Nearly all new users received a generic drug after patent expiry. Further results will be presented on omeprazol and simvastatine, with very recent patent expiries. CONCLUSIONS: Our findings indicate that patent expiry may cause price competition leading to cost decreases. This is opposite the current opinion that the drug reimbursement system would inadequately control drug prices.