OBJECTIVES: The targeted B-cell therapy rituximab (RTX) is registered for patients with rheumatoid arthritis (RA) who have had inadequate response or intolerance to one or more TNF-alpha blocking agents. The only third payer in Hungary, the National Health Insurance Found required economic data about RTX treatment for reimbursement decision. The aim of our study was to estimate the cost-effectiveness of RTX in Hungarian context in RA patients who failed anti-TNF therapy. METHODS: We developed a Markov model to perform a cost-utility analysis. Cost per quality adjusted life year (QALY) gain was assessed. RTX was compared with traditional treatment (DMARDs) in the model. Model states were defined by ACR responses. Baseline characteristics of the patient population and clinical efficacy were based on international data, the REFLEX trial. Costs of rituximab (drug therapy, administration and monitoring) were calculated based on official Hungarian price list. RA related costs were taken from a previous Hungarian cost-of-illness study considering disease levels by HAQ. Utility was derived using the equation between HAQ and EQ-5D from a Hungarian survey of RA patients. The time horizon of the model was lifetime. Cost effectiveness analysis was performed for one year RTX treatment. The model used a societal perspective including all costs. RESULTS: One year long RTX treatment (9 month between courses) results in 0.228 QALY gain compared with traditional treatment in lifetime perspective. Incremental total costs were 6,224 Euros, cost-effectiveness ratio was 27,258 Euros/QALY. Cost-effectiveness of two years long RTX treatment is 23,182 Euros/QALY. Increasing the duration of treatment resulted better cost-effectiveness ratio. CONCLUSION: Cost-effectiveness of RTX is under the commonly used financing threshold (30,000 €/QALY), although RTX was compared with low cost traditional treatment. Hungarian cost-effectiveness ratio may be higher than the European average because drug costs are comparable but medical costs are lower in Hungary than in the EU.