OBJECTIVE: The objective of this study was to develop a pharmacoeconomic model which compared the difference in cost-effectiveness (CE) between a Multiple-daily-dosing (MDD) protocol of aminoglycosides (AG) managed by a Clinical Pharmacokinetic Dosing Service (CPS) and a protocol for Once-daily-dosing (ODD), from the perspective of a Managed Care Organization. METHOD: Event rates for both clinical effectiveness and aminoglycoside-associated-nephrotoxicity (ANN) for MDD were determined by a retrospective chart review of 262 randomly sampled patients who received gentamicin for the treatment of serious gram-negative bacterial infections between January 1, 1990 and March 30, 1998. The incidence of ANN was 3.1%. Event rates for ODD protocol for both clinical effectiveness and ANN were determined to be 82.2% and 5.8%, respectively based on an extensive review of the current literature. Time-in-motion studies were performed to determine personnel costs for all nursing and pharmacy activities. Decision analysis was used to determine the CE of the two protocols. RESULTS: The results were unexpected based on reports in the literature predicting substantial cost savings with the use of ODD programs. In the base case analysis the expected per patient cost value for MDD with CPS and ODD protocols was $241 and $237 respectively. However, MDD with CPS was determined to be more cost-effective than ODD due to slightly increased rate of clinical effectiveness and a decrease in the rate of ANN (average CE ratios=$281 versus $287, respectively). Both one-way and two-way sensitivity analyses were performed by varying the two key parameters of clinical effectiveness and ANN. The model was robust to alterations in these key parameters. CONCLUSION: This CE analysis questions the benefit of implementing an ODD program when compared to a more traditional MDD protocol managed by a CPS for aminoglycoside dosing.