Abstract
Two approaches can be used to estimate the cost of schizophrenia. Prevalence-based cost provides an estimate of the direct and indirect economic burden incurred in a period of time as a result of the prevalence of schizophrenia during the same base period, most often a year. Incidence-based cost represents the lifetime cost resulting from the illness. Different examples of studies applying the 2 methods are illustrated, by stressing the advantages and the pitfalls of both. The incidence-based approach is the most appropriate for the purpose of making decisions about which treatment to implement. Cost analysis of lifetime schizophrenia requires reliable data on service use and treatments and particular methodological instruments. In particular, since schizophrenia is in many cases a chronic disease, pharmaco-economic evaluation should also be applied using an incidence-based approach rather than a short period of treatment.