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This study aimed to assess the potential cost-effectiveness of testing patients with nephropathies for the I/D polymorphism before starting angiotensin-converting enzyme (ACE) inhibitor therapy, using a 3-year time horizon and a healthcare perspective.We used a combination of a decision analysis and Markov modeling technique to evaluate the potential economic value of this pharmacogenetic test by preventing unfavorable treatment in patients with nephropathies. The estimation of the predictive value of the I/D polymorphism is based on a systematic review showing that DD carriers tend to respond well to ACE inhibitors, while II carriers seem not to benefit adequately from this treatment. Data on the ACE inhibitor effectiveness in nephropathy were derived from the REIN (Ramipril Efficacy in Nephropathy) trial. We calculated the number of patients with end-stage renal disease (ESRD) prevented and the differences in the incremental costs and incremental effect expressed as life-years free of ESRD. A probabilistic sensitivity analysis was conducted to determine the robustness of the results.Compared with unselective treatment, testing patients for their ACE genotype could save 12 patients per 1000 from developing ESRD during the 3 years covered by the model. As the mean net cost savings was €356 000 per 1000 patient-years, and 9 life-years free of ESRD were gained, selective treatment seems to be dominant.The study suggests that genetic testing of the I/D polymorphism in patients with nephropathy before initiating ACE therapy will most likely be cost-effective, even if the risk for II carriers to develop ESRD when treated with ACE inhibitors is only 1.4% higher than for DD carriers. Further studies, however, are required to corroborate the difference in treatment response between ACE genotypes, before genetic testing can be justified in clinical practice.