This study examines the organisational structure of pharmacoeconomics departments in major pharmaceutical and biotechnology companies, the impediments to optimal use of pharmacoeconomic evaluations by companies and the integration of pharmacoeconomic analysis with research and development decision making. The heads of the pharmacoeconomics departments of 40 companies were surveyed on the structure of pharmacoeconomics departments in their companies, the roles that pharmacoeconomic analyses are playing in the new drug development decision-making process, and the initiation of pharmacoeconomic studies during the development process for a random sample of their companies' investigational new drugs. 45 department heads from 31 parent companies responded to the survey. The pharmacoeconomics function in pharmaceutical and biotechnology companies is relatively new and growing rapidly. Most pharmacoeconomics department heads preferred a different reporting structure than what they currently have and indicated that the strategic role that pharmacoeconomics can play is not well understood within the organisation. Pharmacoeconomic analyses have been increasingly initiated early in clinical development and have been a factor in clinical trial design and in key decisions made during the development process. Given the continued emphasis on containing healthcare costs worldwide, demand will increase for evidence that drugs provide good value for the money spent on them. Companies will likely respond not only with more economic evaluations for purchasers, but also with greater use of pharmacoeconomics early in the development process to aid in rationalising key research and development decisions, and in guiding final pricing decisions and reimbursement planning, thereby improving resource allocations.