OBJECTIVES Development of a cost effectiveness analysis to evaluate treatment options for haemophilia patients with inhibitors in Germany. METHODS Costs and outcomes of four different treatment regimens were compared by using an Excel-based Markov model with a three month cycle length. Comparators are low- and high dose protocols vs. strict on-demand treatment and to a mixture of both protocols after conducting a risk assessment. Time horizon: 18 years. Success rates of the different ITI-protocols, rates of anamnestic response, bleeding event rates and success rates for the treatment of bleeds were obtained from the literature. Costs included the costs for factor concentrates and hospitalization. Costs for one average patient were reported from a third party payers' perspective. Annually discounting rates were 3% for costs and 5% for benefits. RESULTS One average patient treated on-demand costs €1,558,962.54 and has 181.92 minor and 2.43 severe bleeds. The cost for the same patient treated with the high dose ITI-protocol is approximately double (€3,340,976.81), but the patient has 2/3 fewer bleeds. The incremental cost per additional avoided minor bleed compared to on-demand treatment is €14,816.77 for the high dose protocol, €9,716.50 for ITI after risk assessment and €8,938.84 for the low dose protocol. The incremental costs per avoided bleed is €12,810.19 more for ITI after risk assessment than for the low dose ITI protocol. When comparing the high dose ITI protocol vs. ITI after risk assessment, each avoided bleed costs an extra €313,417.11. CONCLUSIONS The results of the model suggest that use of risk assessment is the most cost effective approach to ITI. Although data on rare diseases are scarce and hard to compare, decision-analytic modelling is a valuable tool to weight the costs and consequences of different treatment regimens for patients with severe haemophilia complicated by inhibitors.