Objective: To quantify the health economic impact of managing cow milk allergy (CMA) in South Africa, from the perspective of healthcare insurers in both the private and public sectors and parents/carers of CMA sufferers.Methods: A decision model depicting the management of CMA in South Africa was constructed, using information obtained from interviews with paediatric specialists in the private and public sectors with relevant clinical experience. The model was used to estimate the expected 12-monthly levels of healthcare resource use and corresponding costs (at 2007/08 prices) attributable to managing CMA sufferers following an initial consultation with a paediatrician.Results: The expected 12-monthly cost incurred by an insurer attributable to managing a CMA sufferer following an initial consultation with a paediatrician was estimated to be R2,430.4 (€202.0) and R1,073.7 (€89.0) in the private and public sector, respectively. The expected 12-monthly cost incurred by parents/carers following an initial consultation with a paediatrician was estimated to be R43,563.1 (€3,634.0) and R24,899.9 (€2,076.9) in the private and public sector, respectively. The time taken for a CMA sufferer to be put on an appropriate diet and achieve symptom resolution was estimated to be 24 days in the private sector and 18 days in the public sector. The total cost to manage an annual cohort of 18,270 newly diagnosed infants with CMA in South Africa in the first year following presentation to a paediatrician was estimated to be R22.1 (€1.8) million for healthcare insurers and R489.1 (€40.8) million for parents/carers. The expected costs to insurers were driven by visits to general paediatricians and prescriptions for dermatological drugs in both the private and public sectors. The expected costs to parents/carers were driven by over-the-counter (OTC) purchases of clinical nutrition preparations.Limitations: The intolerance rates were derived from a study among 1,000 infants with CMA in the UK, healthcare resource use was not collected prospectively and the study period was limited to 1 year following presentation to a paediatrician and does not consider the impact of CMA in subsequent years. However, most children outgrow this form of allergy by the time they reach 2 years of age.Conclusion: CMA imposes a substantial socio-economic burden in South Africa, especially on parents/carers of CMA sufferers. Any strategy that reduces this burden should potentially lead to higher compliance with clinicians’ recommendations, thereby improving health outcomes associated with treatment and should also release healthcare resource use for alternative use.