OBJECTIVES: Approximately 60% of breast cancer cases are a type sensitive to hormones. Tamoxifen is the most widely used treatment of hormone-dependent breast cancer. The pharmacological activity of tamoxifen is dependent on its conversion by the hepatic drug–metabolizing enzyme CYP2D6. Patients with reduced CYP2D6 activity derive inferior therapeutic benefit from tamoxifen, and may alternatively be treated with newer aromatase inhibitors (AIs). However, the high costs of AIs provide incentive for identifying patients who will benefit from tamoxifen prior to treatment. We estimated the cost-effectiveness of genetic testing in combination with hormone therapy for early breast cancer in Canada. METHODS: We performed a cost-effectiveness analysis using a Markov model from a societal perspective and a lifetime horizon. The base case assumed 40-year-old ER+ hormone sensitive women with early breast cancer. We evaluated: genetic testing with subsequent treatment based on genetic status (tamoxifen for CYP2D6 extensive metabolizers and AIs for decreased metabolizers) vs. no testing (tamoxifen for all patients). Probabilistic sensitivity analysis was used to incorporate parameter uncertainties. Expected value of perfect information was performed to identify future research directions. Outcomes were quality-adjusted life years (QALYs) and costs. RESULTS: The genetic testing and treatment combination strategy resulted in a 2.87 QALY gain when compared to no testing. The incremental cost was CAD $25,661 compared to standard care, and the incremental cost-effectiveness ratio (ICER) for the base case was $8,927 per QALY. The ICER was sensitive to disease progression among intermediate metabolizers, and costs of terminal care and aromatase inhibitors. CONCLUSIONS: CYP2D6 Genetic testing in combination with hormone treatment for early breast cancer patients may be economically attractive in the current setting. Future research is required to determine efficacy of extended tamoxifen (more than 5 years) treatment, the rate of progression to a more advanced cancer health state and adverse events by CYP2D6 polymorphism.