In Thimphu, the capital, there is Bhutan's Institute of Traditional Medicine Services sprawled on a hilltop, with the Traditional Arts Center and National Library just below. The Institute provides medical services, trains traditional doctors, and conducts research on Bhutan's medicinal plants to identify the ingredients in centuries-old remedies and help develop new health products. The Institute has a library of recipes dating back to the introduction of Tibetan Buddhism around 1616, collected from monasteries, which is where most of the medical lore has been retained by educated monks. Bhutan's medical institute is similar to the Mentsekhang (Tibetan Medical Institute), which is based in Lhasa and has a refugee branch in Dharamsala (India). Pema Dorji, the director of Bhutan's Institute, was originally trained at the Mentsekhang in Lhasa , prior to the Chinese take over.

As with Tibetan medicine, the main methods of diagnosis are feeling the pulse, checking urine, and examining the eyes and tongue, as well as interviewing the patient. Therapeutically, the Bhutanese rely on herbal combinations, limited acupuncture therapy (including use of the golden needle), applications of heat (usually with metal rods), and minor surgical interventions, all done in the context of Buddhist ritual. There is a hospital for modern medicine relied upon mainly for treatment of acute and severe diseases. Bhutanese herbal medicine is also similar to that of Tibet . Originally, herbal powders were swallowed down with warm water, but with the introduction of modern equipment, the herb mixtures are now produced as pills. The specific formulas used in Bhutan differ somewhat from their Tibetan counterparts in that there are local influences on the selection of herbs, but most of the key herbs are the same, as the altitude and climate conditions are similar to that of Tibet . A substantial amount of herbal materials-perhaps 30% of the total used-are imported from India and Nepal .

A European Union (EU) project to support traditional medicine in Bhutan was initiated in the year 2000. According to data collected as part of this project, there are about 600 medicinal plants used in Bhutanese traditional medicines, out of Bhutan's 5,600 identified species (a comprehensive Flora of Bhutan has been written recently, as part of another project that was started in 1975). About 300 of these herbs are used routinely and are at risk for ecological loss due to clearance of trees and over-collection of herbs. The EU has invested in having these herbs raised as cash crops to create jobs, provide a new medicine factory with raw materials, and protect the environment. The Bhutanese are producing 35 tons of herbal materials each year, partly as a result of these efforts.

It has been suggested that as many as 3,000 species of plant are used in Bhutanese medicines, but this figure no doubt includes substitutions (several species of the same genus, or plants having similar appearances, substituted for one another); local folk remedies; and double-counting of the species, as commonly occurs in plant surveys based on medicine samples. Neither Tibetan nor Bhutanese medicines have been subjected to strict studies, in part due to: their complexity (some remedies contain dozens of ingredients); variability (the content of the finished formulas vary both in terms of ingredients used and the natural variability of constituent levels within plants); and the unique traditional medical applications that are not well suited to modern testing. A few of the medicinal materials are toxic, limiting interest in further investigation.

A view of the traditional medicine situation in Bhutan can be gained by examining several news reports on the subject, presented below. All materials are quoted from the sources mentioned, with slight editing.

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