The Saudi Food and Drug Authority (SFDA) has released a comprehensive guideline for Economic Evaluation Studies (EES), introducing a standardized framework for evaluating the economic and therapeutic value of pharmaceutical products in Saudi Arabia. As healthcare budgets expand and the demand for cost-effective solutions increases, this new framework supports more informed decision-making for manufacturers and healthcare providers.

The SFDA now requires an EES submission as part of the drug registration application. This also applies to other types of submissions that require drug pricing, such as renewals, price appeals, and re-pricing requests.

Understanding Economic Evaluation Studies

Economic Evaluation Studies are essential for assessing the costs and benefits of healthcare interventions. According to the SFDA guideline, EES compares various treatment options based on their financial impact and outcomes to evaluate a new product’s added value against current standards. The SFDA categorizes EES into two main types:

Partial Economic Studies – Focuses on independent cost or consequence analyses, such as Budget Impact Analysis (BIA), which evaluates the financial feasibility of a new intervention.
Full Economic Studies – Known as Pharmacoeconomic Evaluation Studies (PES), this category assesses both costs and outcomes, including:
- Cost-Effectiveness Analysis (CEA)
- Cost-Minimization Analysis (CMA)
- Cost-Utility Analysis (CUA)
- Cost-Benefit Analysis (CBA)

Mandatory Requirements

The requirement for submission of EES applies to all human pharmaceutical products undergoing pricing procedures, including registration, price re-evaluation, and renewals in SFDA. SFDA implemented these requirements in July 2025, requiring all manufacturers and Marketing Authorization Holders (MAH) to submit EES for innovative pharmaceutical products by July 2025. To facilitate evaluation, submissions must include detailed documentation on various factors, such as:

Epidemiological Data: Information about disease prevalence, incidence, targeted populations, and the number of patients globally and in Saudi Arabia.
Market Share Projections: Market share is the percentage of a pharmaceutical product’s sales (by volume and value) compared with all alternative products used to treat the same condition. The current market share in Saudi Arabia must be included in the submission to the SFDA. For a new product, estimated market share for the next five years must be provided.
Drug Marketing Plan: Detailed strategies for product distribution within the Saudi healthcare sector. It should include the distribution segment and/or prescription type.
Access Agreements: Agreements that ensure accessibility of medications, such as entry agreements, localization initiatives, incentives, breakthrough designation, and Patient Support Programs (PSP). If any changes in the access agreement occur later, the applicant must notify the SFDA. Entry agreements are considered when there are any pricing decisions, and in such case the company must state the type of agreement planned for Saudi Arabia and submit it to the SFDA during product registration.
Health Technology Assessment (HTA): Information on comparable HTA decisions from agencies like the National Institute for Health and Care Excellence (NICE), Canadian Agency for Drugs and Technologies in Health (CADTH), Institute for Clinical and Economic Review (ICER), Pharmaceutical Benefits Advisory Committee (PBAC) and others.
For each product type such as New Chemical Entity (NCE), generic, biological or biosimilar, it is mandatory to submit one of the best-suited EES.

Economic Evaluation Methodology

The SFDA emphasizes the use of validated models tailored to the Saudi healthcare landscape to achieve accurate economic assessments. Cost assessments must reflect direct and indirect healthcare costs, including long-term care and productivity loss. When reporting results, SFDA recommends using sensitivity analysis to address uncertainties in economic models, with graphical representations such as cost-effectiveness acceptability curves and scatter plots enhancing clarity.

Implications for Manufacturers and Healthcare Providers

The SFDA guideline empowers manufacturers to present the economic value of their products transparently, helping the SFDA make informed pricing and reimbursement decisions. Healthcare providers will benefit from a clearer understanding of the cost-effectiveness of available treatments, promoting a more sustainable healthcare system that balances innovation with economic responsibility.

EES Implementation Phases

The EES general requirements were implemented in two phases: voluntary implementation from July 2024 to June 2025, followed by mandatory implementation from July 2025 onward.

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