A population dynamic model of schistosome transmission was used to investigate the interaction between drug efficacy and drug price of different brands of praziquantel in determining the cost-effectiveness of school-targeted treatment for Schistosoma mansoni. In this analysis, costs were affected by coverage, drug price and distance travelled, and effectiveness by coverage and drug efficacy. Four effectiveness measures were assessed: the number of infection case-years prevented, heavy infection case-years prevented, hepatomegaly case-years prevented and fibrosis case-years prevented. The interactions between drug efficacy and drug price were complex. In particular, there was a highly nonlinear relationship between drug efficacy and cost-effectiveness, with drugs of low efficacy producing high and variable cost-effectiveness ratios, particularly when other programme costs related to distance travelled were high. The results suggest that given the current price range of praziquantel, a drug with less than a 50% chance of killing the worms is not to be recommended. This has important practical implications for the widespread use of praziquantel, since most international agencies procure praziquantel purely on the basis of price. There is clearly a need for studies which evaluate the efficacy of new brands of praziquantel, and more credence should be given to the use of high efficacy brands, not only in terms of maximizing the cost-effectiveness of the intervention programme, but also in delaying the onset of drug resistance.