OBJECTIVES:  To estimate the cost-effectiveness of pembrolizumab compared to ipilimumab in the management of metastatic melanoma patients previously untreated with ipilimumab in the French settings. METHODS:  A 20-year cost-effectiveness analysis was developed to assess the cost per QALY and cost per Life Year Gained (LYG) of pembrolizumab versus the trial comparator, ipilimumab, as a first line treatment in the perspective of the French health care system. A partitioned survival model including 3 health states was used. Inputs related to efficacy, including OS and PFS, were derived from the phase III clinical trial Keynote 006. EQ-5D was collected in the trial and utilities were derived using the French algorithm. Mean weekly pre-progression and post-progression costs were estimated from a chart review study performed between 2012 and 2014 in France (264 patients). Costs of drugs were defined according to public prices. A discount rate of 4% was applied to both efficacy and costs. Scenario sensitivity analysis also compares pembrolizumab with other relevant comparators. RESULTS:  Pembrolizumab was associated to 0.83 QALY and 1.06 LY gained versus ipilimumab over the time horizon. The ICER of pembrolizumab versus ipilimumab was below 100,000€/QALY. Deterministic sensitivity analysis shows that the key drivers were discount rate, timing horizon, relative efficacy and post-progression cost. Scenario sensitivity analysis results show that pembrolizumab is cost effective compared to other relevant comparators. CONCLUSIONS:  This health economic analysis shows that pembrolizumab is a cost-effective strategy, bringing substantial health benefit to the patients at an acceptable additional cost for the payer.