OBJECTIVES: Owing to rapid, persistent efficacy in reducing pain and preventing structural damage, tumor necrosis factor-alpha inhibitors (anti-TNFs) has revolutionized the treatment of ankylosing spondylitis (AS). However, the high price of anti-TNFs has limited their use. Recent studies suggest that increased medication costs by adopting anti-TNFs may be offset by decreased values of other cost categories. In most cost-effectiveness studies on AS-treatments, costs were estimated as a whole. Our objectives were to 1) develop a simulation model which can simulate QoL and different cost categories from a societal perspective as affected by AS treatments with sequential drugs using the ASAS recommendations at group level; 2) parameterize the model using Dutch data; and 3) analyze simulated cost-effectiveness of treatment strategies with and without anti-TNFs. METHODS: Discrete-event paradigm was selected for model development. Pathways in AS-treatments were simulated in conjunction with changes in AS-specific measures. Parameterization was realized using original data from an observational cohort of AS patients and literature where necessary. Frequencies of visits to rheumatologists and hospitals, and having paramedical treatments, informal/formal care, sick leave and work disability were estimated using logit and Poisson regression models. Health utility was estimated using a proportional-odds model. Demographic variables were also considered in model selections. Two compared strategies in the simulation were 1) three Cox-1 plus two Cox-2 selective non-steroidal anti-inflammatory drugs, and 2) same as strategy 1 plus Etanercept and Infliximab. The simulation was run for 1000 patients until death.  RESULTS: Simulated values of QALYs and different cost categories were in reasonable ranges. Productivity and hospital costs constituted largest shares of the total costs, and were significantly lower in strategy 2 (P <0.05).  The incremental cost per QALY gained of strategy 2 against strategy 1 was €25,165. CONCLUSIONS: The model is flexible and promising for assessing actual costs-effectiveness of different treatment strategies for different societies.