Objective: Insulin detemir represents a class of long-acting soluble insulin analogues intended to address basal insulin requirements for patients with diabetes. Because direct acquisition costs of newer medications are higher than older insulin treatments, payers are interested in their long-term value. This study was conducted to quantify the long-term cost-effectiveness of insulin detemir compared to intermediate-acting NPH insulin for the treatment of T1DM in Canada. Methods: The CORE Diabetes Model was used to project lifetime clinical and economic outcomes for T1DM patients on insulin detemir versus NPH insulin. A slight advantage for insulin detemir in HbA1c (-0.12%) and significant reductions in major (69%) and minor (25%) hypoglycemic events were modeled. These clinical assumptions, as well as cohort characteristics (baseline age and HbA1c of 27 and 8.9%, respectively), transition probabilities, utilities, dis-utilities, direct treatment and complication costs (from a Canadian provincial payer perspective) were derived from recent published literature and on-line sources. Both clinical and economic outcomes were discounted at 5% per annum. Results: Average total direct costs per patient were CAN$88,403 for insulin detemir and CAN$76,551 for NPH using a lifetime horizon. A 61% reduction in major hypoglycemic events costs for detemir (CAN$765) vs. NPH (CAN$1965) were observed. Quality-adjusted life years (QALYs) increased by 0.344 years (discounted) with detemir and were largely due to decreased hypoglycemic events. The resulting incremental cost-effectiveness ratio (ICER) for detemir vs. NPH was CAN$34,418/QALY. Conclusion: The ICER obtained in this analysis provides evidence for the long-term cost-effectiveness of insulin detemir compared to NPH in T1DM and is consistent with current Canadian standards. The overall value of detemir was driven primarily by its favorable impact upon hypoglycemic events as well as lower costs in treating major hypoglycemic events.