OBJECTIVES: To estimate the cost-effectiveness of quetiapine in combination therapy compared to current combination therapies in the treatment of acute mania in bipolar I disorder using a discrete event model. METHODS: A discrete event simulation model was used. In this model a cohort of 10.000 bipolar I disorder patients was created using Dutch data on relevant patient characteristics. This cohort was then used for the comparison of the different treatment options. The treatment options compared in the model were: 1). quetiapine & lithium; 2). olanzapine & lithium; and 3). risperidon & lithium. For effectiveness four trials on quetiapine were used. The effect measure was the number of serious side effects. Serious side effects were: extra pyramidal symptoms and/or more than 7% weight gain. Included costs were: drug costs, hospital costs, hospital visits and laboratory tests (2003 price levels). RESULTS: For the combination therapy of quetiapine & lithium, the incremental net costs per serious side effect averted were € 1203 compared to risperdon & lithium and € 3481 compared to olanzapine & lithium. The effectiveness on hospital stay is comparable over the three combination therapies compared. CONCLUSIONS: Serious side effects may be averted with quetiapine & lithium therapy at incremental costs. Whether these costs are acceptable requires further research into the ‘willingness to pay' to avert one serious side effect.