It is in doubt about whether response of government hospitals to prescription cost savings can be evaluated through hospital formularies. The objective was to determine a measure refl ecting such response and methods to increase it. An observation on products in a government hospital formulary included their numbers; prices; classes; category, essential medicine (EM) or non-EM; EM sub-lists, List A (basic) to List E; type, generic or brand; and hospital availability, single or dual. The numbers and prices of products were associated with the topics observed. A dominant character of EMs was to increase the numbers, but that of generics was to decrease the prices of products. Single availability expanded the prices of generic and brand products but dual availability narrowed them. For generic products, the numbers decreased but the prices increased from basic to upper EM sub-lists. A hospital formulary could refl ect trend of prescription and cost, therefore it is clear that response to prescription cost savings could be determined through it. Proportion of products that are both EM and generic has been considered as measures indicating such response. Including more EMs and generics and delisting unnecessary brands in the basic EM sub-list and major classes could enhance the response.