OBJECTIVE: Pamidronate prevents skeletal-related events in breast cancer patients with skeletal metastasis, but it costs $175 per month and published cost-utility analyses have yielded conflicting results. The purpose of our study was to rigorously evaluate the cost-utility of pamidronate. METHODS: We considered two hypothetical cohorts of woman with metastatic breast cancer receiving or not pamidronate (90 mg every 28 days). We developed a 24-month-long Markov chain including 5 health states related to skeletal metastases (chronic bone pain, acute fracture, vertebral or non-vertebral, post-fracture, vertebral or non-vertebral) and death. Probabilities of clinical outcomes were obtained from two randomized clinical trials addressing chemotherapy-treated (CTPs) and hormone-treated (HTPs) patients. Cost estimates were derived from local hospital charges and market cost of drugs. Quality of life estimates were obtained with a structured time trade-off interview of 20 health care workers. Cost-effectiveness was calculated from the perspective of the National Health Care System. RESULTS: At baseline analysis, life expectancy of pamidronate was 13 quality-adjusted days in CTPs and 30 days in HTPs, while incremental cost was $1,469 in CTPs and $2,275 in HTPs. The incremental cost per QALY gained was $40, in CTPs and $27,857 in HTPs. Sensitivity analysis revealed that the results depended on: 1) the quality of life correlated with the primary disease, threshold values being 0.30 (baseline 0.33) in CTPs and 0.42 (baseline 0.73) in HTPs; 2) the quality of life on pamidronate, threshold being 0.27 (baseline 0.28) in CTPS and 0.58 in HTPs (baseline 0.62). and 0.83. CONCLUSIONS: Based upon the results of this analysis we can conclude that pamidronate is cost-effective in reducing skeletal events of patients with metastatic breast cancer undergoing chemo- or hormone-therapy. The variation of the estimates among the present and the two previous studies can be explained in terms of model and country differences.