Therapeutic innovations are generating increasing pressure on health care budgets particularly for hospitals. Health care professionals are confronted with budgetary, ethical and equity issues when no explicit criteria for choice have been set by the community. Reviews of cost-advantage profile for costly innovations are rare. OBJECTIVE: This work seeks to analyse propensity and capacity of health systems to finance therapeutic innovations according to their cost/advantages profile. METHODS: A literature review was carried out. A series of therapeutic innovations addressing life-threatening conditions were identified between 1988 and 2003. They were selected according to: whether they were considered as innovations at time of their introduction into the market and their cost high. 44 publications in peer-reviewed journals were selected. Innovations were classified according to severity of the condition and the treatment impact on vital prognosis and survival. Reported costs were actualised to 2002 values. Common indicators across studies were identified. RESULTS: The cost per year of life saved (YLS) for breast cancer treated for combinations including paclitaxel in Europe varies between 7800 and €14000; at five years, the cost for trastuzumab/paclitaxel association is €23000 in UK. This is between €7000 and €14000 for ovarian cancer. Cost per YLS for myocardial infarctus treated by alteplase in France is €12000. It varies between €45000 and €79000 for implantable cardiac defibrillators. This cost varies between €10000 to 1€2000 in Europe and around €12000 in France for drotrecogin alfa (activated) (recombinant human activated protein C) for treatment of severe sepsis with multiple organ failure, recently launched in France. CONCLUSIONS: Pharmaco-economic indicators such as cost per YLS can assist payors in decision-making process when confronted with costly innovations in chronic and acute disease. A further step is to consider the budget impact, taking into account criteria such as incidence, prevalence, severity, and mortality.