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Recent press speculation has suggested that Viagra could cost as much as £10 a tablet.
That prompted some doctors to warn it could bankrupt the NHS with the cost topping £1bn a year - one quarter of the entire NHS drugs budget.
But Viagra's manufacturer, pharmaceutical giant Pfizer, says it will charge the NHS £4.84 a tablet.
Pfizer says Viagra will cost the NHS about £50m after five years.
The move follows reports that the UK Government might impose a temporary ban on the pills until it can draw up guidelines on the treatment in December.
The Department of Health has consistently said that Viagra would only be prescribed according to clinical need and not be freely available on the NHS.
Dr Ian Bogle, chairman of the British Medical Association, warned that the cost of the drug could cause the NHS serious problems.
Dr Bogle said: "I do not want to see patients with a clinical condition who would benefit from the drug being denied it, but on the other hand if it was made freely available on prescription, the country, I believe, could not afford it."
Pfizer will learn in the next few days whether it has got approval to market the drug in Europe.
Pills sold in nightclubs
Earlier this week, advertising watchdogs have launched a clampdown on companies which have been using the hype around Viagra to push their own impotence "cures".
The huge interest in Viagra has already seen the drug being sold illegally in nightclubs and on the Internet.
Viagra works by relaxing the tissue around the penis, so that blood can flow more easily to the area.
Over 100 men around the world are said to have died after taking the drug. Pfizer warns that it should not be taken in combination with nitrate-based drugs.
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Viagra information for Europe (EMEA)
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