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Anti-seizure medications (ASMs) are commonly used to prevent recurring epileptic seizures, but around a third of people with epilepsy fail to achieve an adequate response. Vagus nerve stimulation (VNS) is clinically recommended for people with drug-resistant epilepsy (DRE) who are not suitable for surgery, but the cost-effectiveness of the intervention has not recently been evaluated. The study objective is to estimate costs and quality-adjusted life-years (QALYs) associated with using VNS as an adjunct to ongoing ASM therapy, compared to the strategy of using only ASMs in the treatment of people with DRE, from an English National Health Service perspective.A cohort state transition model was developed in Microsoft Excel to simulate costs and QALYs of the VNS + ASM and ASM only strategies. Patients could transition between five health states, using a 3-month cycle length. Health states were defined by an expected percentage reduction in seizure frequency, derived from randomized control trial data. Costs included the VNS device as well as its installation, setup, and removal; ASM therapy; adverse events associated with VNS (dyspnea, hoarseness, and cough); and health-state costs associated with epilepsy including hospitalizations, emergency department visits, neurologist visits, and primary care visits. A range of sensitivity analyses, including probabilistic sensitivity analysis, were run to assess the impact of parameter and structural uncertainty.In the base case, VNS + ASM had an estimated incremental cost-effectiveness ratio (ICER) of £17,771 per QALY gained compared to ASMs alone. The cost-effective ICER was driven by relative reductions in expected seizure frequency and the differences in health care resource use associated therewith. Sensitivity analyses found that the amount of resource use per epilepsy-related health state was a key driver of the cost component.VNS is expected to be a cost-effective intervention in the treatment of DRE in the English National Health Service.PLAIN LANGUAGE SUMMARYPeople with epilepsy are usually given anti-seizure medications (called ASMs) to help prevent their seizures from reoccurring. However, around a third of them will keep having seizures even with the medication; this is called drug-resistant epilepsy (DRE). Treatment options for DRE include, but are not limited to, surgical or therapeutic device-related interventions or trying alternative ASM combinations.In the English National Health Service (NHS), vagus nerve stimulation (VNS) therapy is recommended by the National Institute for Health and Care Excellence (NICE) for DRE patients who are still having seizures despite trying several different ASMs, and who cannot have brain surgery. Following NICE technical standards, we developed an economic model to test whether VNS would be a cost-effective add-on to ASM therapy. The model uses current costs for VNS therapy and takes a more nuanced approach to the longevity of the VNS device than previous research did.Results showed that adding VNS to ASMs can be a cost-effective way to treat DRE in today’s NHS in England. VNS reduces the number of seizures, which is expected to improve patients’ quality of life and cut NHS costs that would otherwise have been needed to look after patients who had a seizure (for example, emergency visits or inpatient hospital stays). Sensitivity analyses tested aspects of uncertainty in our model. These highlighted the need to further understand the relationship between seizures, their severity, and health care usage if we want to make improved cost-effectiveness analyses about DRE in the future.