OBJECTIVES: To assess the cost-effectiveness of EGb761^® for the treatment of mild dementia due to Alzheimer's disease (AD) and vascular dementia (VaD) in the Czech Republic in comparison to no treatment or acetylcholinesterase inhibitor (AChEI-donepezil; only AD).  METHODS: Developed ten-year Markov cohort model with half-year cycle length projects outcomes (Quality-Adjusted Life-Years-QALYs; Life-Years Gained-LYGs) and costs of treatment for patients with AD and VaD aged 65 years from payers' perspective. Model health states are defined by the severity of dementia according to Mini-Mental State Examination (MMSE), i.e. no&minimal/mild/moderate/moderately severe/severe dementia and by death. Treatment schemes of dementia, which reflect current management, differ depending on severity of disease and assessed interventions. Transition probabilities and utilities were taken from published literature. Drug costs (EGb761^®€63/half-year, donepezil €94/half-year) and costs of mild/moderately severe/severe dementia (€192/€318/€1,709 per half-year) were derived based on statement of KOLs and reimbursed lists. Costs and outcomes were discounted by 3%. Probability sensitivity analysis (PSA; 3,000 iteration) was performed with willingness-to-pay (WTP) threshold of 3 times GDP per capita in the Czech Republic (i.e. €44,000).  RESULTS: EGb761^® was dominant compared to no treatment in both mild AD and mild VaD while generating cost savings of €560 and €355 and gaining 0.2150QALYs/0.1287LYGs and 0.1841QALYs/0.11439LYGs over a 10-year horizon. In comparison to active therapy in mild AD, EGb761^® is slightly less efficient (loss of 0.0025QALYs/0.0001LYGs), but also cheaper (by €35) than AChEI in a 10-year horizon. PSA showed that probability of EGb761^®to be cost-effective varies from 50% to 84% at the WTP threshold. CONCLUSIONS: EGb761^® represents a cost-saving intervention with more QALY gained, i.e. dominant therapy compared to no pharmacotherapy in treatment of mild dementia in 10 years. EGb761^® shows very similar results (slightly cheaper and less efficient) in comparison to AchEI (e.g. donepezil) in the therapy of mild AD.