OBJECTIVES: A pharmacoeconomic analysis was undertaken to determine costs, consequences and cost-effectiveness of a brand of partially hydrolyzed 100% whey formula manufactured by Nestlé (PHF-W), in the prevention of atopic dermatitis (AD) in “at risk” children when compared to extensively hydrolyzed formula (EHF-Whey or Casein) in Denmark. METHODS: Based on a 6-month time horizon for formula consumption, an economic model was developed synthesizing treatment pathways, resource utilization and costs associated with the treatment of AD in healthy “at risk” Danish newborns who were not exclusively breastfed.  The cost of formula was retrieved from market surveys while other model inputs were obtained from the literature.  A meta-analysis of 6 studies that compared the efficacy of PHF-W (557 patients) and EHF (559 and 580 patients for EHF-Whey and EHF-Casein) yielded RR of 0.75[0.54,1.05] at 0-12 months and 0.80[0.63,1.02] at 0-36 months for PHF-W vs. EHF-Whey and RR of 1.06[0.74,1.53] at 0-12 months and 1.13[0.87,1.47] at 0-36 months for PHF-W vs. EHF-Casein.   Given the evidence for non-significant differences between PHF-W and EHF, the analytic approach amounted to a cost-minimization analysis reporting the difference in formula acquisition costs. In the base case, it was assumed that infants consumed the formula of choice for the full 6 months.  In a sensitivity analysis, subjects consuming PHF, EHF-Whey or EHF-Casein who developed AD symptoms were switched to EHF-Whey, EHF-Casein or EHF-Whey, respectively.  RESULTS: Savings per child receiving formula of DKK 17,033 were generated for PHF-W vs. EHF-Whey while savings of DKK 16,974 were observed for PHF-W vs. EHF-Casein. The sensitivity analysis yielded a cost saving of DKK 16,800 with PHF-W.  CONCLUSIONS: Under a range of assumptions, this analysis demonstrated the cost-saving nature of PHF-W vs. both types of EHF in the prevention of AD among Danish infants.  Further sensitivity analyses, including multivariate, are planned for confirmation of results.