OBJECTIVES: To determine the cost effectiveness of a new reuptake inhibitor, when compared with -XR in treating major depressive disorder. METHODS: A cost effectiveness analysis, using a decision tree modeled outpatient treatment over six months.  Analytic perspectives were those of society (all direct and indirect costs) and the Ministry of Health of as payer for all direct costs.  Rates of success and dropouts were obtained from a meta-analysis of placebo-controlled trials.  Costs were taken from standard lists, adjusted to 2005 Canadian dollars; discounting was not applied.  One-way sensitivity analyses were performed on monthly acquisition costs and success rates; Monte-Carlo analysis examined all parameters over 10,000 iterations. RESULTS: From both perspectives, outcomes all numerically -XR (Expected success=53% and 57%, Symptom-free days 52.72 and 57.03 for uloxetine and venlafaxine-XR, respectively).  Total expected costs/patient treated were $7,081 and $6,551, $20,987 and $19,997 (societal perspective), respectively. Expected costs/SFD were $134 and $115 and $398 and $351 (societal viewpoint), respectively.  Although results were sensitive to changes in success rate within the 95% CI, Monte-Carlo analyses using the ICER (incremental cost effectiveness ratio) as outcome found -XR was dominant in approximately 78% of scenarios in both perspectives. CONCLUSIONS: Differences in pharmacoeconomic outcomes found were modest, but in all cases, favored venlafaxine-XR over duloxetine. Therefore, a possible advantage may exist at the population level in the treatment of major depressive disorder in Canada. Ultimately, a head to head study of the two drugs would be needed to confirm these findings.