OBJECTIVES: The analysis of the sub-group of patients who received one prior VEGF-TKI-based therapy in the RECORD-1 clinical trial reported a median progression-free survival of 5.42 months and 1.87 months for the everolimus and BSC-alone arms, respectively.  A Markov model was developed to assess the cost-effectiveness of treating mRCC patients whose disease had failed on one prior VEGF-TKI therapy with everolimus versus BSC alone from the Canadian societal perspective. METHODS: A Markov model simulated 2 hypothetical patient cohorts (everolimus versus BSC alone) from the time of initial treatment throughout the 6-year time horizon. The cost-effectiveness of everolimus was calculated in terms of cost per life-years gained (LYG) as well as cost per quality-adjusted life year (QALY) gained.  Health state transition probabilities were derived directly from the RECORD-1 subgroup analysis; costs and health state utility values were obtained from literature.  The analysis was performed from a societal perspective; as such, direct medical costs and indirect costs associated with productivity loss due to morbidity or future income loss attributed to early mortality were included.  A sensitivity analysis from the payer’s perspective was additionally performed.  Outcomes and costs were discounted at a 5% annual rate. RESULTS: Treatment with everolimus produced an estimated gain over BSC alone of 0.643 LYG (0.455 QALYs) at an incremental cost of $22,074.  The deterministic analysis resulted in incremental cost-effectiveness ratios (ICERs) of $34,326/LYG and $48,507/QALY.  The payer’s perspective sensitivity analysis resulted in ICERs of $48,670/LYG and $68,777/QALY. According to the probabilistic sensitivity analysis, given a threshold of $100,000/QALY, the probability that everolimus was cost-effective, from a societal perspective, was 100%. CONCLUSIONS: Results of this analysis suggest that, from a Canadian societal perspective, everolimus is a cost-effective alternative to BSC alone when treating mRCC patients whose disease fails on one prior VEGF-TKI treatment.