OBJECTIVES: Determine the cost-effectiveness of becaplermin gel* on wound healing and amputation for the treatment of diabetic foot ulcers (DFUs).  METHODS: A 4-stage Markov model was used to predict the expected costs and outcomes of wound healing and amputation rates for becaplermin and non-becaplermin DFU cohorts over a 1-year time period. Outcome data used in the analysis were derived from a propensity score matched cohort of 24,898 subjects with DFU from the Curative Health Services database from 1998-2004 who were followed for 20 weeks. Primary outcomes of interest were ulcer-free weeks and rates of amputation. Costs for amputation and becaplermin gel^*were derived from standard cost references and medical supply wholesalers. Total weekly costs per episode of DFU care were estimated from a large retrospective claims database. Transition probabilities for healing and amputation were derived from the aforementioned propensity score matched cohorts. Ulcer recurrence was estimated from the medical literature. Utilization for becaplermin was calculated using the manufacturer’s recommended dosing algorithm. The economic perspective taken was that of the payer. Costs are reported in 2013 US dollars.  RESULTS:  Overall, 2,394 (9.6%) received becaplermin. Of those who received becaplermin, 33.5% healed at 20 weeks compared to 26.5% who did not receive becaplermin (p<0.0001). In addition, the percent of patients requiring amputation were significantly (p<0.0001) lower in the becaplermin cohort (4.9% versus 6.4%, respectively). Patients treated with becaplermin had substantially higher ulcer-free weeks compared to non-becaplermin patients (16.1 versus 12.5 weeks, respectively). Expected annual direct costs for DFU were $20,885 for becaplermin and $23,506 for non-becaplermin.   CONCLUSIONS: Becaplermin was economically dominant over standard therapy, providing better outcomes at a lower cost in patients with DFU.  In addition, becaplermin is more effective in wound healing and preventing amputation, thereby decreasing long-term costs for DFU.    *Regranex®, Smith & Nephew Biotherapeutics, Fort Worth, Texas