BACKGROUD Chronic hepatitis B (CHB), affects 350-400 million people worldwide, being associated with increased risk of liver failure and approximately 300,000 cases of hepatocellular carcinoma per year. Treatment with pegylated interferon (48 weeks) is associated with the possibility of sustained disease remission, with no need for maintenance with any other drug.  Furthermore, on-treatment monitoring of HBsAg can predict response to peginterferon–alfa-2a (Lau 2009). Currently, only entecavir is available for HBeAg-positive chronic hepatitis B cirrhotic patients under Brazilian Public Healthcare System.   OBJECTIVES: To compare costs and outcomes of on-treatment monitoring of HBsAG levels during  peginterferon–alfa-2a therapy versus standard entecavir treatment of CHB under Brazilian Public Healthcare System perspective. METHODS: To project disease progression, a Markov model was built based on clinical stages of CHB. A stopping rule was applied to peginterferon–alfa-2a scenario at week 12 based on efficacy results from Lau 2009: if HBsAg > 20000 UI/ml, treatment is switched to 2nd line treatment (tenofovir). Medical resources related to each stage were obtained from Castelo, 2007. Efficacy of entecavir was obtained from Veenstra, 2007 & 2008. Tenofovir was also available as 2nd line treatment for entecavir scenario. Discount rate for costs and outcomes was 5%, according to Brazilian guidelines for HTA. Costs were reported in 2010 Brazilian Reais (US$1≈$Brz1.8). RESULTS: Assuming a lifetime perspective, expected costs and outcomes for peginterferon-alfa-2a were: $Brz 38,605, 15.37 LYs and 13.64 QALYs. For entecavir: $Brz 39,630, 15.20 LYs and 13.41 QALYs. Cost-effectiveness analysis estimated an ICER of (-$Brz37,614/LYs) and (-$Brz15,556/QALYs) for peginterferon-alfa-2a, being the dominant therapy. CONCLUSIONS: Considering on treatment monitoring of HBsAg, findings suggest that peginterferon–alfa-2a shows higher clinical responses and is a cost saving therapy for the management of CHB patients in the Brazilian Public Healthcare System.