A list of those drugs available for prescription (by NHS Trusts in the UK), reimbursement under a health insurance plan or offered under a capitated or managed care programme, or preferred in a particular clinical setting. Usually drawn up as cost-containment measures and widely encouraged, the aims of a formulary are usually said to be to promote safe, rational and cost effective prescribing.

See also:
National Health Service (NHS)
Prescription only medicine (POM)
Health Care Financing Administration (HCFA) (US)
Cost-effectiveness threshold (health economics)