There has been a resurgence of controversy about the usefulness of observational data to study the efficacy of drugs. Nearly every week a researcher makes some criticism of clinical trials or justifies observational research into intended effects, with other researchers offering a contradictory viewpoint. Literature reviews are not useful in this regard because the contradictory studies will not usually be carried out. Some methods are discussed which may have potential utility in the study of intended effects. There may be a marginal role for statistical techniques such as propensity scores and confounder scores. More promising techniques may include ecological analyses, restriction of subjects and blinded prospective review. Because it is currently unknown when the observational study of drug efficacy is possible, we should arguably always carry out a study of the determinants of prescribing first, and possibly consider using the various techniques that are outlined in this article. Copyright © 2003 John Wiley & Sons, Ltd.