OBJECTIVES: To estimate the health economic impact of Sensor-Augmented Insulin Pump (SAP) Therapy among Insulin-Dependent Diabetes Mellitus (IDDM) patients in Colombia. METHODS: The Core Diabetes Model (CDM) is highly validated, computer simulation model to determine the long-term health outcomes and economic consequences of diabetes interventions. A recent real life clinical study in Colombia evaluating 217 IDDM patients (average baseline HbA1c of 8.97%, mean age 34 years, and average diabetes duration of 14 years) who initiated SAP therapy showed that SAP therapy led to a reduction of -1.47% HbA1c as well as a significant reduction in severe hypoglycaemic events.  The impact of the reduction in the fear of hypoglycaemic events on quality of life was also included. RESULTS: Life expectancy of patients with SAP was increased by 3.51 years and diabetes related complications were delayed on average by 1.74 years. The Incremental-Cost-Effectiveness-Ratio (ICER) for SAP was $44,889,916COP ($24,939USD) per Quality-Adjusted-Life-Year gained based on direct costs only. SAP related therapy costs were partially offset by the savings due to the reduction in long-term complications, including proliferative diabetic retinopathy (PDR), Severe Vision Loss (SVL), End Stage Renal Disease (ESRD), and Amputations (AMP). The relative reduction in incidence of these complications (PDR 42%, SVL 20%, ESRD 46%, AMP 12%) as well as the average delay in their onset (4.9 years, 4.0 years, 3.8 years, 3.7 years, respectively) due to SAP therapy is profound.  When including indirect costs, SAP demonstrated an even lower ICER.  Extensive sensitivity analyses showed the robustness of the results. CONCLUSIONS: Using a payer’s perspective, our analysis showed that SAP is cost-effective over a lifetime horizon in IDDM patients in the Colombian setting (using a WTP threshold of $60,771,600COP [3x GDP]) and can lead to an increase in life expectancy.  When using a societal perspective, SAP was even more cost-effective.