OBJECTIVES: Mortality associated with the lung cancer is maximum among all forms of cancer in the US. Among all lung cancer patients, 85% have non-small cell lung cancer (NSCLC). Of these NSCLC patients, 5% are EML4-ALK gene positive patients. In these patients, standard therapy [platinum doublet (cisplatin and gemcitabine) as first-line therapy, pemetrexed as second-line therapy, and erlotinib as third-line therapy] has shown plateau effect.  In 2014, FDA has approved Ceritinib as a first line therapy based on the results from phase one study, under the orphan drug category for ALK+NSLCC. Study aims to evaluate the cost-effectiveness of EML4-ALK fusion targeted ceritinib treatment as compare to treatment by standard therapy among ALK+NSCLC patients in the US. METHODS: A decision analytic model with the embedded Markov model was developed to compare the lifetime benefits in terms of quality adjusted life years [QALYs] and direct medical costs of the treatment strategies for patients with advanced NSCLC. Progression free survival rate during each treatment alternatives, rates of adverse events, mortality rates, and utility values on standard therapy and ceritinib were obtained from published literature. Cost inputs were based on 2013 Medicare reimbursement rates. Primary outcome of incremental cost effectiveness ratio (ICER) was estimated as an incremental cost of treating with Ceritinib per QALY gained. USD 100,000 was considered as the willingness to pay threshold.  RESULTS: The use of EML4-ALK targeted ceritinib treatment for EML4-ALK–positive advanced NSCLC results in added benefits (0.09 QALYs) and extra costs ($1897.82) for the average patient with NSCLC. The ICER was $21,263 for per QALY gained.  CONCLUSIONS: Study suggests that the treatment by Ceritinib compared to the treatment by standard therapy alone is a cost-effective strategy based upon the decision analysis model. Study limitation includes non-inclusion of the cost of EML4-ALK gene testing, which could change the total treatment cost significantly.