Government is the largest provider of health services in Bihar, but it has a long history of non-performance. With the change of government, the state decided to provide medicines free of cost for most common ailments to outdoor and indoor patients in all government health facilities. The purpose was to improve the health standard of deprived people of the state and to rejuvenate the public health system. Efforts to streamline drug procurement and distribution were made though rate contracting and ?cash & carry system'. The result of the improved free drug distribution system is very encouraging but there is scope for further improvement.