OBJECTIVES: Hepatic encephalopathy (HE) is associated with high morbidity and mortality. Rifaximin-α 550mg is effective in reducing the recurrence of overt HE episodes, and hospital utilisation. We characterised the cost effectiveness including societal impact of rifaximin-α 550mg plus a standard of care (SOC) versus SOC alone (lactulose) in patients with liver cirrhosis in The Netherlands. METHODS: A Markov state transition model was used. Outcome metrics were incremental cost effectiveness ratios (ICERs), derived from cost/quality adjusted life years (QALYs) estimates and estimates of impact of work productivity loss upon patient/carer using a friction cost method reflecting patient and societal considerations in the model. Outcomes data were from two trials of rifaximin-α 550mg. Dutch costs data were derived from published sources and societal cost estimates were from the Dutch costing manual (2010) inflated to 2015 prices. Health-related utility was estimated indirectly from disease-specific quality of life RCT data. The time horizon was lifetime. Costs and benefits were discounted at 4% and 1.5%, respectively. RESULTS: Lifetime discounted average costs of included care/societal elements was €67,018 in the rifaximin-α 550mg + SOC arm and €37,365 in the SOC arm, a €29,653 difference. Corresponding values for discounted incremental health benefits are equal to 1.24 life years or 0.93 QALYS. This translated into a cost effective base-case ICER of €31,897 at a lifetime horizon. CONCLUSIONS: Use of rifaximin-α 550 mg + SOC in patients with recurrent HE in the context of liver cirrhosis represented good use of economic resource and was cost-effective compared with SOC alone, by reducing overt HE episodes, the likelihood of hospital admission and hospital length of stay.