The Danish health care system provides partial reimbursement of most prescription medications in Denmark. The dispensation of prescription medications is registered in administrative databases. Each time a prescription is redeemed at a pharmacy, an electronic record is generated with information related to the user, prescriber, the pharmacy, and the dispensed drug. The National Health Service gathers this information for administration of the drug reimbursement plan. Recently, this information became the basis for the establishment of a new research database, the Danish National Database of Reimbursed Prescriptions (DNDRP). In this paper, we review the content, coverage, quality, linkage, access, and research possibilities of this new database. The database encompasses the reimbursement records of all reimbursed drugs sold in community pharmacies and hospital-based outpatient pharmacies in Denmark since 2004. On average, approximately 3.5 million users are recorded in the database each year. During the coverage period, the number of annual prescription redemptions increased by 15%. Most dispensed prescriptions are in the categories "alimentary tract and metabolism", "cardiovascular system", "nervous system", and "respiratory system". Individuals are identified by the unique central personal registration (CPR) number assigned to all persons born in or immigrating to Denmark. The new database fully complies with Denmark's Act on Processing of Personal Data, while avoiding additional restrictions imposed on data use at the Danish National Prescription Registry, administered by Statistics Denmark. Most importantly, CPR numbers are reversibly encrypted, which allows re-identification of drug users; furthermore, the data access is possible outside the servers of Statistics Denmark. These features open additional opportunities for international collaboration, validation studies, studies on adverse drug effects requiring review of medical records, studies involving contact to general practitioners, and linkage of prescription data to other clinical and research databases. The DNDRP thus is a valuable data source for pharmacoepidemiological research.