ATC stands for Anatomical Therapeutic Chemical, a classification system maintained by the World Health Organization that assigns a unique code to every drug based on the organ it targets, how it works, and its chemical identity. The system has been the international standard for organizing medications since 1981, and it’s used by governments, researchers, pharmacies, and regulatory agencies worldwide to track and compare how drugs are used.
How the ATC System Works
The ATC system sorts drugs into groups across five levels, moving from broad to specific. Each level adds detail, and the result is an alphanumeric code that tells you exactly what a drug is and what it’s designed to treat.
The first level is the broadest: fourteen major groups based on which organ system or body area the drug acts on (the digestive system, the nervous system, the cardiovascular system, and so on). The second level narrows to a pharmacological or therapeutic subgroup, identifying what general category of treatment the drug falls into. The third and fourth levels get more specific, classifying drugs by their chemical or therapeutic properties. The fifth and final level identifies the individual chemical substance itself.
To see this in action, consider metformin, one of the most commonly prescribed diabetes medications. Its ATC code is A10BA02. The “A” at the first level tells you it targets the alimentary tract and metabolism (the digestive system). “A10” at the second level identifies it as a drug used in diabetes. The third and fourth levels (“BA”) place it among a specific chemical subgroup of blood glucose-lowering drugs. And “02” at the fifth level pinpoints metformin as the exact substance. Every metformin product in the world, regardless of brand name, carries that same code.
What Gets Included (and What Doesn’t)
Not every substance earns an ATC code. The system primarily covers drugs that have been proposed for licensing or already hold marketing authorization in at least one country. New chemical entities and biological drugs are typically added once an application for marketing authorization is ready for submission. Herbal products can qualify, but only if they’ve been formally assessed and approved by a regulatory authority based on efficacy, safety, and quality data. Cell and gene therapy products are included when they have an official recognized name.
Complementary medicines, homeopathic remedies, and traditional herbal products are generally not included. The system also isn’t fully comprehensive for a simpler reason: some substances haven’t been added because no one has submitted a request. The WHO Collaborating Centre considers other medicinal products on a case-by-case basis.
The Connection Between ATC Codes and Daily Doses
The ATC system is almost always paired with something called the Defined Daily Dose, or DDD. Together they form the ATC/DDD system. While the ATC code identifies what a drug is, the DDD provides a standardized measurement of how much of it is typically used per day for its main indication in adults. This pairing makes it possible to compare drug consumption across hospitals, regions, or entire countries, even when different brands, formulations, or packaging sizes are involved.
Without a common unit of measurement, comparing drug use between, say, Germany and Japan would be nearly impossible. One country might sell a drug in 500 mg tablets and another in 250 mg capsules, but by converting everything to DDDs, researchers can produce meaningful side-by-side statistics.
Why ATC Codes Matter in Practice
The ATC/DDD system serves as a shared language across the global pharmaceutical landscape. Producers, wholesalers, pharmacies, and regulatory authorities all use ATC codes to identify active substances consistently. Many countries have adopted the ATC classification as their national standard for categorizing medicinal products, which keeps everyone from drugmakers to insurers on the same page.
For public health agencies, drug utilization statistics built on ATC codes are essential tools for planning, monitoring, and evaluating national drug policies. If a country wants to know whether antibiotic prescribing is rising or falling, ATC codes and DDDs provide the data framework to answer that question year over year.
In pharmacovigilance (the monitoring of drug side effects), the system helps link adverse reactions to entire drug classes rather than just individual products. If several drugs in the same ATC group are producing similar side effects, that pattern becomes visible. And because DDDs provide volume-of-use data, researchers can calculate how frequently adverse reactions occur relative to how widely a drug is actually prescribed, giving a much clearer picture of real-world risk.
Pharmacoepidemiology researchers rely on ATC codes to follow trends and patterns in drug use over time. Applying a specific set of codes and DDDs to prescription data across years reveals shifts in treatment practices, helps evaluate whether clinical guidelines are being followed, and flags unexpected changes in prescribing behavior.
Who Manages the System
The ATC/DDD system is developed and maintained by the WHO Collaborating Centre for Drug Statistics Methodology, located at the Norwegian Institute of Public Health in Oslo. This center operates under an agreement between WHO headquarters and the Norwegian government, and it has held responsibility for coordinating the system since 1982.
The classification index is updated annually, with changes published in both electronic and print formats. A cumulative list of every ATC and DDD alteration made since 1982 is publicly available. The system uses International Non-proprietary Names (the generic, non-branded name of a drug) whenever possible, which keeps the classification independent of commercial interests.
The ATC system itself evolved from an earlier classification developed by the European Pharmaceutical Market Research Association. Norwegian researchers modified and expanded it into the version that WHO adopted as the international standard in 1981, and it has been the backbone of global drug utilization research ever since.