Omeprazole regulates gastric acid secretion and is an effective treatment of acute duodenal ulcer and reflux oesophagitis, achieving more rapid healing and symptomatic relief than histamine H 2-receptor antagonists. When administered as maintenance therapy, omeprazole reduces the incidence of relapse. The drug is also highly effective in patients poorly responsive to histamine H 2-receptor antagonists. The daily acquisition cost of omeprazole is higher than that of histamine H 2-receptor antagonists in many countries, and thus it is important to evaluate the pharmacoeconomic impact of omeprazole in the short and long term treatment of duodenal ulcer and reflux oesophagitis. Pharmacoeconomic analyses have been performed in several clinical settings using pooled data from clinical trials or simulated models of clinical practice. In a single analysis using Finnish cost data, omeprazole was more cost effective than ranitidine in the treatment of duodenal ulcer disease over a 6-month period. The cost effectiveness of omeprazole was comparable to that of sucralfate-containing regimens, with patients receiving omeprazole being healed more quickly and experiencing a greater number of healthy days. Using a computer-model simulation and Swedish cost data, omeprazole was more cost effective than ranitidine when administered as intermittent treatment of duodenal ulcer over 5 years. Preliminary reports indicate that regimens which eradicate Helicobacter pylori are more cost effective than those which do not. As short term treatment of reflux oesophagitis, omeprazole 20 to 40 mg/day was the dominating treatment strategy, being less costly and more effective than ranitidine 300 to 1200 mg/day. Omeprazole 20 mg/day produced symptom-free days more cost effectively than either cimetidine 1.6 g/day or ranitidine 300 mg/day. More importantly, as long term (maintenance or intermittent) treatment of reflux oesophagitis, omeprazole 20 mg/day was more cost effective than both ranitidine 150 mg twice daily and 'phase 1' therapy (diet and antacids) over 6 and 12 months. Thus, based on analyses evaluated, omeprazole appears to be more cost effective than ranitidine in the short term treatment of duodenal ulcer. Results for long term treatment are less clear cut, but full details from some studies are not yet available. For the short term treatment of reflux oesophagitis omeprazole is more cost effective than ranitidine or cimetidine and for long term treatment omeprazole is more cost effective than ranitidine. As treatment for reflux oesophagitis, omeprazole is considered to be the dominating treatment strategy.