OBJECTIVES: To project long-term clinical and cost outcomes associated with biphasic insulin aspart 30 (BIAsp 30) and oral hypoglycemic agents (OHAs) in a Swedish setting based on the findings of a randomized clinical trial. METHODS: A published, validated and peer-reviewed model of diabetes was used to simulate the progression of diabetes-related complications based on clinical trial data which showed that switching to BIAsp 30 significantly reduced HbA1c compared to continuation of OHAs in insulin-naïve patients with type 2 diabetes over 16 weeks (difference in HbA1c reduction 0.648%; p<0.001). Direct medical costs were accounted from a third party payer perspective in Sweden and expressed in 2004 Swedish Kroner (SEK). Costs and clinical benefits were discounted at 3% annually and sensitivity analyses were performed on treatment effect, time horizon and discount rates. RESULTS: BIAsp 30 was projected to extend life expectancy (mean [standard deviation]) by 0.47 [0.22] compared to OHAs (11.38 vs. 10.90 years). Quality-adjusted life expectancy was improved with BIAsp 30 by 0.42 [0.15] quality-adjusted life years (QALYs) versus OHAs (7.94 vs. 7.52 QALYs). BIAsp 30 was associated with a lower cumulative incidence of diabetes-related complications, particularly retinopathy and nephropathy. Mean direct lifetime costs were higher in the BIAsp 30 group (SEK 286,467 [11,745]) than in patients receiving OHAs (SEK 272,752 [12,885]), a difference of SEK 13,716 [17,030], leading to an incremental cost-effectiveness ratio of SEK 32,736 per QALY gained. Sensitivity analysis showed that these findings were robust under variation in a range of assumptions. CONCLUSIONS: Switching to BIAsp 30 was projected to reduce the incidence of diabetes-related complications, and improve life expectancy and quality-adjusted life expectancy, compared to continuation of OHAs in type 2 diabetes patients. Switching to BIAsp 30 was projected to represent good value for money by internationally accepted standards in the Swedish setting.