OBJECTIVES: Recently published data suggest that an acceptable threshold of around £30,000 per quality adjusted life year (QALY) gained is implicitly used in NICE appraisals on cost-effectiveness of medical interventions. The objective of this analysis was to investigate the sensitivity in drug prices during acute treatment of reflux oesophagitis with esomeprazole 40mg or omeprazole 20mg by applying a £30,000 threshold in a cost-utility analysis. METHODS: Results from a cost-effectiveness analysis based on clinical study data have previously been published using a decision analysis model that considered UK direct medical costs up to 8 weeks. In the current analysis, this model was modified to include utility values associated with having (0.69) or not having reflux oesophagitis (0.84). Utility values were derived from a recent study using the rating scale method in patients with gastro-oesophageal reflux disease. An additional analysis was made extending the model to a 16-week time-frame in order to assess further costs and effects of achieving treatment success or not during the initial 8 weeks. Patient management assumptions were based on a UK physician survey. RESULTS: When the price of omeprazole was set to zero, the 8-week and the 16-week analyses resulted in around £27,700 and £23,200 per QALY gained respectively by using esomeprazole treatment. A sensitivity analysis indicated results below the £30,000 threshold in most combinations of different assumptions and scenarios while holding the price of omeprazole constant at zero. In the 16-week analysis, esomeprazole treatment remained cost saving (i.e. esomeprazole provided better effectiveness at similar or lower costs) when the price of omeprazole was reduced by around 45%. CONCLUSIONS: Applying an acceptable threshold of £30,000 per QALY gained in a cost-utility analysis of esomeprazole versus omeprazole in the acute treatment of reflux oesophagitis indicates that esomeprazole will remain cost-effective irrespective of future generic omeprazole prices.