OBJECTIVES:  To assess the cost-effectiveness of roflumilast (ROF) added to triple inhaled therapy (ICS+LABA+LAMA) versus ICS+LABA+LAMA alone in UK patients with severe chronic obstructive pulmonary disease (COPD), chronic bronchitis and ≥2 moderate or severe COPD exacerbations in the past year. Data used were from the phase 3b/4 clinical trial REACT’s (NCT01329029) valid cases set, as a proportion of REACT patients did not meet the licence criteria for ROF. METHODS:  An Excel-based cohort state transition (Markov) model estimated total costs and outcomes over 40 years from a UK National Health Service and Personal Social Services perspective. The model has three GOLD-based states: severe COPD, very severe COPD, and death. All patients enter in the severe state and there is an irreversible transition from severe to very severe COPD. Background rates of moderate and severe exacerbations were estimated with negative binomial regressions adjusting for disease severity and treatment in the trial sub-population treated with triple therapy. Published health-related quality of life weights were applied to health states and exacerbations to generate quality-adjusted life years (QALYs). List prices for drugs were used. RESULTS:  ROF reduced the annual rate of exacerbations (moderate or severe) compared with ICS+LABA+LAMA alone (rate ratio [RR]: 0.80, p=0.0117). There was a greater reduction in rates of severe (RR: 0.66; p=0.003) than moderate (RR: 0.89; p=0.247) exacerbations. ROF treatment resulted in the avoidance of >1 severe and 0.6 moderate exacerbations per patient. Approximate incremental gains for ROF were 0.17 QALYs at £2996 per patient (probabilistic cost per QALY: £17,855/QALY), with a 70% probability of being cost-effective at a £20,000/QALY threshold. ROF remained cost-effective under several different sensitivity analyses, and also had favorable cost-effectiveness when evaluated in patients with very severe COPD. CONCLUSIONS:  ROF as add-on to ICS+LABA+LAMA is cost-effective for patients with severe COPD and frequent exacerbations.