Reference-scaled average bioequivalence (RSABE) has been recommended by Food and Drug Administration (FDA), and in its closely related form by European Medicines Agency (EMA), for the determination of bioequivalence (BE) of highly variable (HV) and narrow therapeutic index (NTI) drug products. FDA suggested that RSABE be evaluated by an approximating procedure. Development of an alternative, numerically exact approach was sought. A new algorithm, called Exact, was derived for the assessment of RSABE. It is based upon the observation that the statistical model of RSABE follows a noncentral t distribution. The parameters of the distribution were derived for crossover and parallel-group study designs. Simulated BE studies of HV and NTI drugs compared the power and consumer risk of the proposed Exact method with those recommended by FDA and EMA. The Exact method had generally slightly higher power than the FDA approach. The consumer risks of the Exact and FDA procedures were generally below the nominal error risk with both methods except for the partial replicate design under certain heteroscedastic conditions. The estimator of RSABE was biased; simulations demonstrated the appropriateness of Hedges’ correction. The FDA approach had another, small but meaningful bias. The confidence intervals of RSABE, based on the derived exact, analytical formulas, are uniformly most powerful. Their computation requires in standard cases only a single-line program script. The algorithm assumes that the estimates of the within-subject variances of both formulations are available. With each algorithm, the consumer risk is higher than 5% when the partial replicate design is applied.