The cost of unintended pregnancies (UP) to the US government were $21 billion in 2010. Drug-drug interactions (DDIs) with hormonal contraceptives (HCs) can lead to contraception failure. The cost implications of UP and adverse events (AE) resulting from these DDIs to the payer have not been quantified. To date, pharmacoeconomic evaluations have not accounted for variability in the dose-concentration-effect relationship of drugs on patient outcomes and societal costs. We propose a conceptual framework using linked pharmacokinetic-pharmacodynamic-pharmacoeconomic (PK-PD-PE) models to provide a realistic estimate of the cost-effectiveness of various HC (pills, IUDs, implants and injectables) in women using interacting co-medications. Mechanistic models using physiology and clinical pharmacology parameters of various HC-drug combinations can predict changes in HC concentration. The relationship of dose to outcomes- UP and AE (breakthrough bleeding, thromboembolic disorders), can be determined using aggregate summary-level data from clinical trials (model based meta-analysis). The resultant exposure-response relationships, can generate probabilities of outcomes which can then be input into a pharmacoeconomic model. Direct costs from a payer perspective can be assigned to each downstream outcome (birth, ectopic pregnancy, induced and spontaneous abortion, AE) over a time horizon of total childbearing age in women. Incremental cost-effectiveness ratios (ICERs) can then be calculated between subsets of women taking co-medications (base case) and those not (comparator group). The input probabilities with associated variability can provide a range of possible ICERs. This process can be validated using pharmacoeconomic modeling in real world data situations. Considering the variability in the clinical pharmacology of drugs, linking PK-PD-PE models can provide accurate estimates of the cost-effectiveness of HCs in special scenarios (e.g. Impact of numerous DDIs) where clinical trials are infeasible. The results can be used to guide choice of contraception, clinical guidelines and payer reimbursements to the subset of women on long term therapy with interacting co-medications.