We evaluated the cost-effectiveness of capsaicin 8% patch (QUTENZA™) versus pregabalin in patients with PNP from the perspective of the National Health Service (NHS) and Personal and Social Services in Scotland, UK. A decision-tree cost-effectiveness model was developed for non-diabetic patients with peripheral neuropathic pain (PNP) who were pregabalin-naïve and had not achieved adequate pain relief or tolerated conventional first- or second-line treatments. Patients entering the model received either a single application of capsaicin 8% patch or titrated daily dosing with pregabalin; after 8 weeks patients were classified as responders, non-responders, or were assumed to discontinue treatment due to intolerable adverse events. Responders continued to receive baseline treatment at intervals observed in clinical practice. Non-responders and those who discontinued treatment were assumed to receive last-line therapy (duloxetine). The base-case time horizon was 2 years. Model inputs for effectiveness, discontinuations and health-state utilities were taken from a head-to-head non-inferiority study (ELEVATE, NCT01713426). Other inputs were obtained from published sources or clinical expert opinion. Costs were expressed in GBP 2013/14. Results were presented as incremental cost-effectiveness ratios (ICER), i.e. cost per quality-adjusted life-year (QALY) gained. Model assumptions were tested with scenario analyses. Parameter uncertainty was tested using one-way and probabilistic sensitivity analyses. Compared with dose-optimized pregabalin, capsaicin 8% patch was the dominant treatment strategy (total cost difference, -£11; total QALY gain, 0.049). Capsaicin 8% patch was also the dominant treatment strategy versus pregabalin in 6 out of 7 scenario analyses. The model was most sensitive to variation in time to capsaicin 8% patch retreatment (maximum ICER, £7,951/QALY at lower-bound 95% confidence interval). At a willingness-to-pay threshold of £20,000/QALY, the probability of capsaicin 8% patch being cost-effective versus pregabalin was 97%. Capsaicin 8% patch is a cost-effective treatment option compared with dose-optimized pregabalin in patients with PNP who have failed one or more previous systemic treatments.