OBJECTIVES: To determine the average cost of treatment incurred, to perform pharmacoeconomic analysis of drug therapy and to study changes in patient economic burden with disease activity for RA patients. METHODS: The study design was observational. Patient’s bill and insurance status was collected from the finance department for 250 RA patients. Inclusion and exclusion criteria were followed as per the ACR Guidelines (1987and 2010). Patient drug therapy and disease activity were recorded from individual CRF& hospital records. RESULTS: Of 250RA patients female to male ratio was found to be 3:1. 67% of patients admitted were ages b/w 40–60years. The average days of hospitalization was found to be 7 days with average bed charges of INR 649 per patient. The total cost of therapy incurred per patient was INR 8961. The highest contribution was made by medications (INR 1920/patient), biochemical investigation charges (INR1561), doctor fees (INR1006), X-ray charges (INR385), physiotherapy procedures(INR320).These charges were found to vary within the patient population group based on the stage of the disease &presence/absence of co–morbid conditions. CONCLUSIONS: Medication costs along with investigation charges are the highest contributors to the total expenses incurred by RA patients &has direct impact on HRQOL. These costs seem to vary from patient to patient based on Disease Activity Score and also presence of co–morbid conditions. Hence it becomes vital to diagnose and control the disease at an early stage to control the economic burden on the patient.