OBJECTIVES: To evaluate the budget impact on the Italian NHS of rosiglitazone based treatment strategies, compared to current therapy. METHODS: Estimated target population for alternative treatments were based on algorithms previously reported*. Three groups of patients were identified to compare alternative treatment strategies:1)Rosiglitazone monotherapy vs SU monotherapy; 2)Rosiglitazone+metformin vs SU+metformin; and 3)Siglitazone+SU vs insulin alone or in association with SU. The perspective used was that of the Italian NHS. Time horizon was one year. Costs/patient/year considered were: drug acquisition costs; glycaemia self-monitoring costs; severe hypoglycaemias costs; and clinical tests costs (according to therapy).Glycaemia self-monitoring assumptions were based on AMD (Italian Association of Diabetologists) guidelines. Sensitivity analysis was performed to test the robustness of the assumptions made and their influence on the results. RESULTS: The epidemiological algorithms assigned 19.84% of patients to group 1, 37.8% to group 2 and 42.36% to group 3. Treatment costs/patient/year were: group 1 - €459,91 for rosiglitazone vs €469,06 for SU; group 2 - €531,06 for rosiglitazone+metformin vs €540,20 for SU+metformin; group 3 - €749,44 for rosiglitazone+SU vs. €1.258,11 for insulin+SU and €1.832,97 for insulin alone. For a hypothetical cohort of 10.000 patients, total costs were: group 1 - rosiglitazone €912,460.31 vs. SU €930,581.45; group 2 - rosiglitazone+metformin €2,007,419.76 vs. SU+metformin €2,041,944.92; group 3 - rosiglitazone+SU €3,174,623.90, insulin+SU €1,862,082.89 and insulin alone €5,051,558.94. Total costs of Rosiglitazone based therapy were €6,094,503.97 vs. €9,886,168.20 of current treatments. CONCLUSIONS: Rosiglitazone, when compared to alternative treatment, may offer potential savings to the Italian NHS estimated by our model in €3,791,664 every 10,000 diabetics per year. Savings were mainly related to a reduction in costs of glucose self-monitoring and insulin administration.* Drug utilization of glitazones in Italy. ISPOR, 7th Annual European Congress.