OBJECTIVES: To estimate the cost-utility of sitagliptin (Januvia®) in the treatment of type 2 diabetes and impact of Januvia® reimbursement on Polish National Health Fund (NFZ) budget. METHODS:Cost-utility Markov model from both payers’ perspective (NFZ and patient) was constructed with one year time horizon. Target population were patients with insufficient glycemic control with metformin monotherapy. One comparison: sitagliptin/metformin vs metformin/glipizide was performed in CUA. The measure of the effects was QALY. BIA was performed from public payers’ and both payers’ (NFZ and patient) perspective in 3-year time horizon. Two reimbursement levels were considered 30% and 100%. RESULTS:Average costs of the treatment of diabetes were 3 218.37 PLN for SIT/MET and 1 317.76 PLN for GLI/MET. Treatment effects were 0.715 QALY for SIT/MET and 0.687 QALY for GLI/MET. ICER value for SIT/MET vs GLI/MET was 67 027 PLN/QALY. Assuming 100%- reimbursement, annual expenses from National Health Fund budget would raise by 9.1 (year 2008), 15.9 (2009) and 20.5 mln PLN in year 2010. In case of 30%-reimbursement of sitagliptin, incremental expenditures for NFZ would be: 6.25, 10.94 and 14.07 mln PLN in years 2008, 2009 and 2010 respectively. Assuming both payers’ perspective annual expenses from NFZ  budget and patient would raise  by: 8.3 (year 2008), 14.5 (2009) and 18.6 mln PLN in year 2010. CONCLUSIONS: Results of the analysis indicate that sitagliptin/metformin treatment is more effective and more expensive than strategy with metformin/glipizide. ICER is below the acceptable threshold (83,239 PLN), therefore treatment with SIT can be considered as cost-effective.