OBJECTIVES: Pulmonary arterial hypertension (PAH) is a rare progressive and severe disease with short life expectancy. Bosentan has been shown to slow PAH progression and improve functional status, quality of life, and survival. The objective of the study is to assess cost effectiveness of bosentan for the treatment of PAH from a healthcare payer's perspective in South Korea. METHODS: A Markov model was used to estimate the expected life years, quality-adjusted life years (QALYs) and costs for a hypothetical cohort of 100 PAH patients treated for one year with bosentan compared to iloprost. The health states included in the model were WHO functional class I to IV and death. Transition probabilities were calculated based on observed transitions for bosentan and iloprost. Utility values were borrowed from an existing study, of which the utilities were calculated from estimated EuroQol health states. Costs were comprised of medication, hospitalization, and monitoring. Medication and monitoring costs were estimated from the National Health Insurance reimbursement data, with the latter based on expert opinion while hospitalization costs were estimated from a teaching hospital's claims data for 13 patients. RESULTS: The model predicted that the expected life years of 100 PAH patients would be 98.5 years with bosentan and 98.4 years with iloprost while the expected QALYs would be 51.1 QALYs and 33.1 QALYs, respectively. The estimated costs would be 3,395 million KRW with bosentan and 8,618 million KRW with iloprost. Treatment with bosentan compared to treatment with iloprost resulted in a greater gain in QALYs, though little gain in life years, with a significant cost saving. These findings were not substantially affected by adjustments of transition probabilities, utility values, or price of bosentan. CONCLUSION: Bosentan is more cost-effective or cost-saving than iloprost for the treatment of PAH in South Korea.