OBJECTIVES: To conduct a cost-benefit analysis (CBA) for inhaled drug delivery system for insulin (INI). METHODS: Previously, we reported the average monthly willingness-to-pay (WTP) for INI from diabetic patient (Cdn$153.70±$99.90) and general population (Cdn$68.59±$44.65) perspective in Canada. This study estimates the net benefit and cost-benefit ratio for INH from both patient and general population perspective. The average cost of insulin therapy using subcutaneous insulin injection (SCI) was calculated equal to Cdn$32.40 per month based on average 40 units daily usage of rapid acting insulin for bolus insulin supplement. The cost of self-injection was approximately Cdn$8.40. One form of INI is available using powder form of insulin and a liquid inhaler is under development. The average daily cost of inhaled delivery system for insulin is approximately 40% higher than SCI. Using the same price premium ratio we estimated the average monthly cost of INI in Canada equal to Cdn$45.36 (when being available). The cost of basal insulin and self blood-glucose monitoring was considered equal. RESULTS: In the base-case scenario, the net benefit of INI when compared to SCI was Cdn$90.74 per month from the diabetic patient perspective and Cdn$5.63 from the general population perspective. The cost-benefit ratio (CBR - calculated as ÄCost/ÄWTP) from the patient (0.12) and the general population (0.69) perspective were <1, suggestive of a positive CBR for INI. Extensive sensitivity analysis was performed by changing variables (set apriori) including INI price (+10%,20%) and daily usage of insulin units (±10%,20%). Results of the analysis were robust to the changes in variables. CONCLUSION: This analysis demonstrated that the benefits of inhaled delivery system for insulin for control of blood glucose levels in diabetic patients are greater than the costs, therefore the therapy provide a positive net benefit from both patient and general population perspective and is a good investment for money.