Subject The paper discusses the issues of current pricing for defense products under acute finance challenges to the public procurement system. Objectives The paper aims to develop certain theoretical positions in the field of State defense needs in conditions of the public contract system's development, and propose recommendations on the more effective use of State financial resources. Methods Works of domestic and foreign authors in studying the issues of theory and practice of military economy, military and economic policies are the methodological basis of the study. For the study, I used a system approach to substantiate and develop proposals to improve the contractual mechanism to fulfill State Defense order. Results The paper proves the profitability of price regulation for the supplier and the customer. It invites to move towards the expansion of the practice of price models, and make price agreement a centerpiece in the public contract. Price agreement shall be based on models of prices approved for use by the State. Relevance The proposed recommendations shall ensure the efficient use of the budget allocated to the development, procurement, maintenance and disposal of weapons and military equipment, as well as a closer coordination and the interests of all participants in the life cycle of defense products.
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