OBJECTIVES: Interferon beta-1a (Avonex(r)) is efficacious in delaying clinically definite multiple sclerosis (CDMS) following a single demyelinating event (SDE). The purpose of this study was to determine the cost-effectiveness of Avonex(r) compared to current treatment (CT) in delaying the onset of CDMS. METHODS: A cost effectiveness analysis (CEA) was performed. The outcome of interest was time spent in the pre-CDMS state, termed monosymptomatic life years (MLY) gained. A Markov model was developed with all transitional probabilities derived from the literature. Costs were reported in 2002 Canadian dollars. Costs and outcomes were discounted at 5%. A time horizon of 12 years was applied. All uncertainties were tested via univariate and multivariate sensitivity analyses. RESULTS: From the Ministry of Health (MoH) perspective, the total expected costs per patient were $173,000 and $108,000 for Avonex(r) and CT, respectively. From the SOC perspective, the total expected costs were $317,000 and $262,000, respectively. Expected MLYs gained were 4.69 for Avonex(r) and 3.48 for CT. The incremental cost of Avonex(r) per MLY gained was $53,110 from the MoH perspective and $44,789 from the SOC perspective. The model was sensitive to the probability of progressing to CDMS and the analytical time horizon. CONCLUSION: Our results suggest that Avonex(r) may be considered as a reasonably cost-effective approach to treatment of patients experiencing a SDE. In addition, the overall incremental cost-effectiveness profile of Avonex(r) improves if treatment is initiated in pre-CDMS rather than waiting until CDMS.