OBJECTIVES New classes of anti-diabetes drugs may delay the onset of Insulin treatment. This study investigates the cost-effectiveness of a treatment pathway starting with dapagliflozin (Forxiga^®), followed by exenatide once weekly (Bydureon^®) - both as add-on to metformin - and insulin treatment, compared with a treatment pathway recommended in clinical guidelines that commences with SU add-on to metformin, followed by the addition of insulin regimens in patients inadequately controlled with metformin alone. METHODS The validated CARDIFF model was used for the analyses. Clinical inputs for dapagliflozin versus SU, both as add-on to metformin, and exenatide once weekly were derived from relevant head-to-head clinical trials and long-term follow up studies. Based on these and the United Kingdom Prospective Diabetes Study (UKPDS) equations, the model predicts disease progression and number of micro‑ and macro-vascular complications, along with diabetes-specific and all‑cause mortality. The perspective of the National Health Service in UK was adopted over a lifetime horizon. Local unit costs and utility data were assigned to the appropriate model parameters to calculate total Quality‑Adjusted‑Life-Years (QALYs) and costs. Deterministic and probabilistic sensitivity analyses (PSA) were conducted. RESULTS Long-term evidence showed that the durability of the treatment effects of dapagliflozin and exenatide can delay the onset of insulin treatment by 5-6 years. Compared to the traditional clinical practice, treatment with dapagliflozin+metformin followed by exenatide+metformin, was associated with an incremental benefit of 0.343 QALYs (95%CI: 0.239; 0.450) at an additional cost of £2,827 (95%CI: £2,352; £3,267), resulting in an incremental cost-effectiveness ratio of £8,233 per QALY gained. The PSA showed that at a willingness‑to-pay threshold of £20,000 per QALY, the proposed treatment pathway had a 100% probability to be cost-effective. CONCLUSIONS The proposed alternative treatment sequence was shown to be a cost-effective treatment option in patients inadequately controlled with metformin alone within established UK cost‑effectiveness thresholds.