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Background. In view of the increasing cost of general practice of drug prescribing, it is important to look at ways of reducing drug wastage and thereby improve the cost-effectiveness of prescribing. Objective. To determine the costs and cost savings to the NHS of instalment dispensing for newly prescribed medicines and to quantify the extra costs incurred by patients. Methods. Patients were randomized to receive either a normal (n = 103) or an instalment (n = 101) prescription. Results. The difference between prescribed and dispensed drug costs in the intervention group was £0.98 per patient (95% confidence interval £0.14–£1.82), giving a 7% reduction in drug costs. The costs of the additional pharmacy time required to implement the intervention was calculated to be £5.02 per patient. Conclusions. Introduction of a system of instalment dispensing produced savings in the general practice of drugs bill, but these were not large enough to offset additional costs for pharmacists. [ABSTRACT FROM AUTHOR]