Respiratory syncytial virus is the most common cause of bronchiolitis, a lower respiratory tract infection occurring in infancy. It is responsible for several rehospitalizations, substantial morbidity and occasional deaths in the UK every year. Palivizumab is a recombinant monoclonal antibody that has been shown to reduce hospitalizations in infected infants. It is licensed for high-risk infants, primarily those born pre-term or with chronic pulmonary or cardiac conditions. Palivizumab is expensive, but several economic analyses have determined highly discrepant costs. This article reviews the limitations of the available efficacy and economic data, and highlights problems in interpretation and extrapolation. We also present the results of a cost-effectiveness analysis relevant to populations of high-risk infants in the UK.