OBJECTIVES: Painful neuropathy is a common complication of diabetic patients. The purpose of this study is to compare the cost-effectiveness of duloxetine to routine treatment in the management of pain associated with diabetic neuropathy from a societal perspective. METHODS: The study sample includes patients enrolled in the 52-week, randomized, multi-center, open-label extended phase of a duloxetine versus routine treatment trial in the management of pain associated with diabetic neuropathy. The first patient was enrolled in the study on June 14, 2001 and the last patient completed the extended phase study on April 28, 2003. A sub-population of 233 U.S. patients with diabetic neuropathic pain was randomized to either duloxetine 60 mg BID or routine pain treatment. The primary efficacy measure was the Medical Outcomes Study Short Form 36 (SF-36) bodily pain domain (BP). Total costs (direct medical and indirect productivity loss cost), adjusted to 2002 dollars using Consumer Price Index, were analyzed from a societal perspective. Bootstrap method was applied to calculate statistical inference of incremental cost-effectiveness ratio (ICER). RESULTS: Duloxetine treatment was associated with a significant improvement in SF-36 BP score compared with routine treatment (p-value = 0.05). From societal perspective, duloxetine is both a more cost-effective (ICER = -$429/1 BP, p = 0.04) and dominant (p = 0.06) therapy compared to routine treatment in the management of pain associated with diabetic neuropathy. CONCLUSIONS: This study shows that duloxetine is more cost-effective and dominant treatment for painful diabetic neuropathy compared to routine care.