Objective: The purpose of this study was to estimate the cost-effectiveness of memantine relative to standard care in patients with moderate-to-severe Alzheimer's disease in the Netherlands. Methods: A country-adapted five-year Markov model simulated disease progression through a series of states, defined by dependency and disease severity. Transition probabilities were derived from trials, with utility and epidemiological data obtained from a longitudinal Dutch cohort. Cost-effectiveness was described in terms of quality-adjusted life years and time spent in a nondependent state or in a moderate severity state. Results: Memantine monotherapy versus standard care led to 0.058 quality-adjusted life years gained (1.207 versus 1.265), longer time in a nondependent state (from 1.602 to 1.751 years) and in a moderate state (from 2.051 to 2.141 years), and no additional costs (€ 113,927 versus € 110,097). Robustness of results was confirmed through sensitivity analyses. Conclusion: Memantine is dominant compared with standard care in the Netherlands. Results are consistent with similar economic evaluations in other countries.