OBJECTIVES In patients with type 2 diabetes (T2D) receiving basal insulin therapy, the addition of bolus insulin is a common therapeutic strategy once glycated hemoglobin (HbA1c) becomes uncontrolled. However, this strategy is associated with weight gain and increased risk of hypoglycemia. The objective was to assess the cost-effectiveness of exenatide twice daily (BID) (‘ExBID’) versus insulin lispro three times daily (TID) (‘LisTID’) as add-on therapy to titrated insulin glargine in patients with T2D, from the Swedish healthcare perspective. METHODS This analysis utilized the Cardiff Model, a previously published T2D disease model. Treatment effects were taken from the 4B Study, where ExBID and LisTID resulted in similar glycemic control with less hypoglycemia with ExBID. Furthermore, ExBID was associated with a weight loss of 2.6kg and LisTID with a weight gain of 1.9kg. An assumption made in this analysis is that once the HbA1c level returned to its baseline value, patients escalated to intensified basal-bolus therapy based on published treatment effects. Quality-adjusted life years (QALYs) were calculated, with health-state utilities applied to weight changes, hypoglycemia, and T2D-related complications. Costs (Swedish kronor, SEK) included medication and T2D-related complications. The model was run over a 40-year time horizon. Costs and QALYs were discounted at 3% annually. RESULTS Cost/patient with ExBID and LisTID was SEK 381,177 and SEK 364,381, respectively. ExBID was associated with a QALY gain of 0.64 per patient versus LisTID (11.51 and 10.86 QALYs, respectively). This result was driven by the difference in weight between ExBID and LisTID. The cost/QALY gained with ExBID versus LisTID was SEK 26,292. CONCLUSIONS With a cost/QALY gained of SEK 26,292 (3,039 Euros, 2,582 British pounds, 4,033 US dollars), evaluated against commonly used cost-effectiveness threshold values, ExBID represents a cost-effective treatment alternative to LisTID as add-on therapy to titrated insulin glargine in patients with T2D in Sweden.