OBJECTIVES The anticoagulant effect of warfarin is subject to wide dose variability that may lead to hemorrhagic and thrombotic events. Variations in the CYP2C9 and VKORC1 genes together with clinical factors explain approximately 50% of this variability. The aim was to estimate the health care resource use, and overall costs associated with therapy from the perspective of the UK NHS. METHODS As part of a 6-month prospective cohort study evaluating pharmacogenetic and clinical factors associated with warfarin therapy, patients' use of resources were recorded and costs valued (UK≤ for 2006/7). Resource use was compared among patient sub-groups (defined by age; gender; CYP2C9 genotype; VKORC1 genotype; adverse events; co-medication; co-morbidities; and smoking status). Mean costs were calculated with 95%CI estimated using non-parametric bootstrap sampling. RESULTS Complete data were available for 254 patients. During the study period a total of 930 anticoagulation visits (median 3 per patient, IQR 1, 5) and 4059 INR measurements (median 15, IQR 10, 20) were recorded. Of the 70 patients who had experienced an adverse event, 16 (6.3%) required hospitalisation. Controlling for age, gender, and co-morbidities in patients who experienced an adverse event, the OR for hospitalization was 8.35 (95%CI 1.44, 48.35) for patients with the VKORC1 TT (rs9923231) genotype compared with other genotypes. The mean cost of healthcare attributable to warfarin therapy was ≤392. The management of warfarin-related adverse events contributed to 53% of the overall cost. The mean costs for those who experienced an adverse event was ≤884 (95%CI, 554, 1837) compared with ≤178 (95%CI, 164, 192) for the 179 patients who did not. CONCLUSIONS Our analysis is the first to demonstrate a significant association between VKORC1 variant genotype and hospitalization. Although no independent effect on total cost was evident, carriers of VKORC1 TT were eight times more likely to be hospitalized due to adverse events.