Background: Spinal muscular atrophy type 1 (SMA1) is a devastating genetic disease for which gene-replacement therapy may bring substantial survival and quality of life benefits. Objective: This study investigated the cost-effectiveness of onasemnogene abeparvovec (AVXS-101) gene-replacement therapy for SMA1. Study design: A Markov model was used to estimate the incremental cost-effectiveness ratio (ICER), expressed as cost/quality-adjusted life year ($/QALY), of AVXS-101 versus nusinersen over a lifetime. Survival, healthcare costs and QALYs were estimated using natural history data for SMA patients who achieved motor milestones (sitting/walking). Health utility weights were obtained from the CHERISH trial. Setting: USA; commercial payer perspective Participants: SMA1 infants Interventions: AVXS-101 was compared to nusinersen. Main outcome measure: The primary outcome was the ICER. Results: Expected survival (undiscounted) over a lifetime predicted by the model was 37.20 life years for AVXS-101 and 9.68 for nusinersen (discounted QALYs, 15.65 and 5.29, respectively). Using a potential AVXS-101 price range ($2.5-5.0M/treatment), the average lifetime cost/patient was $4.2-6.6M for AVXS-101 and $6.3M for nusinersen. The ICER range was (-$203,072) to $31,379 per QALY gained for AVXS-101 versus nusinersen, indicating that AVXS-101 was cost-effective with prices of ≤$5M. Conclusion: Single-dose AVXS-101 was cost-effective compared to chronic nusinersen for SMA1 patients.