Doctors will be able to personally tailor treatments using a DNA test which shows which drugs will work best.
Genetic information can show how well people process drugs
Its makers Roche say the chip will cut out the need for patients to try out a series of drugs, risking side effects or reactions, before finding the right one for them.
The chip will be able to analyse drugs used to treat conditions including heart disease and psychiatric disorders.
The test will be used in high-tech laboratories in the US from May, and the company is also seeking European approval for the chip.
Factors such as age, what other drugs a patient is taking, diet and how ill a person is affects how well a drug works.
Most harmful drug reactions will not be solved by this technology
Dr Helen Wallace, Genewatch
But variations in genes controlling how drugs are metabolised, transported around and used by the body also have an influence.
The Roche test focuses on a drug-metabolising enzyme called CYP2D6.
Around 7% of Caucasians are known to lack the enzyme, making them poor metabolisers of drugs.
Another 2 to 4% have enzymes which either function inefficiently or too well, causing problems in how the body processing drugs.
The test takes blood cells, or cells from the inside of the mouth and amplifies the area of the genes which control how the enzyme works.
Scientists can see read the genetic pattern they to see to identify the problem.
Everyone has two copies of each gene.
If the test shows defects in each copy, the person will metabolise drugs poorly.
The chip tests for the presence of a key enzyme
If the person has one normal and one duplicated version, they will be "ultrarapid" metabolisers.
Walter Koch, director of the pharmacogenetics department at
Roche Molecular Systems where the test was developed, said knowing a patient's genetic make-up would help doctors tailor the treatment.
"Knowledge of the intrinsic genetically-determined metabolic activity will allow physicians to adjust doses accordingly to reduce the potential for adverse reactions and to improve drugs' efficiency."
Dr Helen Wallace of the UK campaign group GeneWatch said genetic make-up could not be relied upon as an accurate predictor of how people will respond to drugs.
She told BBC News Online: "There are potential dangers as well as benefits in using genetic test results to decide who gets which medicine.
"Poor predictions, or wrong test results, could mean people are wrongly denied a medicine they need, or given one which could be harmful.
"Most harmful drug reactions will not be solved by this technology - we need much better management of medicines, so side-effects are quickly found and tackled."