OBJECTIVES: To estimate the long-term health and economic impact of managing CHB with entecavir instead of adefovir treatment in the US, based upon projected clinical benefits from HBV DNA reduction observed in trials. METHODS: We took the perspective of a comprehensive payer responsible for all direct health care expenditures. A decision simulation model was developed to consider a hypothetical cohort of 1000 lamivudine refractory CHB patients. Multivariate-adjusted relative risks for five HBV DNA categories were derived from the published R.E.V.E.A.L.-HBV study. These results were applied to the patients with simulation of their HBV DNA data derived from summary statistics reported in separate entecavir and adefovir clinical trials. Entecavir and Adefovir daily costs were assumed $20.52 and $19.11 based on the wholesale acquisition prices. Life expectancy estimates, direct medical cost of and utility scores for different phases of CHB were estimated from published US specific data. Viral resistance due to treatment was included. RESULTS: Entecavir was superior to adefovir for the mean reduction in serum HBV DNA by PCR assay (log10 copies/mL) adjusted for lamivudine effect, with reductions of 4.97 versus 4.00, respectively. More patients reached undetectable viral load level with entecavir than adefovir treatment at Week 48 (19.5% vs 9.6%). In the reference case, for 1000 patients aged 40 years, compared with adefovir, ten years of entecavir treatment avoided 25 compensated cirrhosis, 3 decompensated cirrhosis, and 15 HCC, resulting in 0.235 quality-adjusted life year (QALY) gain at an incremental cost of $2563 per patient (3% discounted). The incremental cost of using entecavir was $10,899 per QALY gained (in 2006). These results were robust to sensitivity analyses. CONCLUSION: Entecavir was projected to be clinically and economically attractive in treating lamivudine refractory CHB patients. Further economic modeling upon the availability of head-to-head clinical trials will be helpful to confirm these findings.