OBJECTIVES: Compare expected costs and health-outcomes in patients with Diabetes Mellitus Type 2 (DMT2) in the Public Sector in Mexico treated with glargine or 25%-insulin lispro, 75%-insulin lispro protamine suspension (LM25). METHODS: This analysis included a hypothetical cohort of insulin-naïve patients with T2DM, aged 30–80, years, with A1C>7.0% taking antihyperglycemic drugs for 90 days. Effectiveness measures included; (1) Percentage of patients with A1C<7.0% levels at 24 weeks, (2) frequency and type of micro and macrovascular complications (MMVC) and (3) hypoglycemic events per 1000 patients considering one-year timeframe. Costs evaluated were: (1) acquisition costs, (2) cost of hypoglycemic events (3) MMVC. Efficacy measures and mean-daily-dose was obtained from DURABLE, parallel, open-label and randomized study comparing directly LM25 and Glargine. Incidences of MMVC were estimated using data from UKPDS study group and data from Meta-analysis by Quayum following a similar process outlined by Grima. Acquisition costs were derived from the transparency portal of the Mexican Social Security Institute. Healthcare services utilization from hypoglycemic episodes were calculated according to international published literature and IMSS Unit Costs updated to 2013 following IMSS methodology, while other associated expenses with MMVC complications come from Mexican reports and Diagnostic Related Groups (DRG) published by IMSS this data was updated to January 2013 using the Bank of Mexico inflation calculator. Costs are expressed in 2013 USD (1USD=$12.70MXN) RESULTS: All results consider 1,000 patients treated in a 1-yeat timeframe. Acquisition costs for LM25 were lower compared to glargine ($291,395 vs $383,521, 24% lower), although costs per hypoglycemia events were higher for LM25 ($12,242 vs. $3,673). Direct medical costs for MMVC were higher for Glargine ($668,027 vs. $754,435) Total medical costs were higher for glargine compared to LM25 ($971,663 vs. 1,141,628). CONCLUSIONS: Results of the present study suggest that compared with LM25, healthcare costs are significantly higher for glargine.