OBJECTIVES: In Nicaragua, 30% of current morbidities are associated with tobacco smoking. Tobacco control policy measures have been initiated in this Central American country, however the population doesn’t have full consciousness of the long-term consequences of tobacco use. The aim of this study was to compare the direct medical costs of smoking cessation therapies with varenicline, nicotine replacement therapy (NRT) and unaided cessation in Nicaragua over two time-horizons: 10 and 20 years. METHODS: The current annual costs of chronic obstructive pulmonary disease (COPD), lung cancer, coronary heart disease (CHD) and stroke were estimated based on the current annual incidence for each disease using one public hospital databases (Hospital Lenin Fonseca, 2010). The Benefits of Smoking Cessation on Outcomes (BENESCO) simulation model was used to obtain the projected direct costs for each strategy.  An adult cohort (n=3,639,948) from Nicaragua was used and the assessment was conducted using the healthcare payer’s perspective. Costs were discounted at 3% annually. Probabilistic sensitivity analyses were conducted using Monte Carlo second order approach. RESULTS: Varenicline is associated with the highest healthcare cost-savings compared with the other two alternatives at 10 and 20 years.  Results at 10 years, showed that varenicline would save US$126,599 and US$188,582 against NRT and unaided cessation, respectively.  In 20 years, savings would be US$3,609,463 and US$5,971,233 against NRT and unaided cessation. The results of probabilistic sensitivity analyses support these findings. CONCLUSIONS: The use of a smoking cessation therapy with varenicline would generate savings in the long-term in almost 6 million dollars to Nicaragua’s healthcare institutions.