Psoriasis is a common, chronic inflammatory disease that can cause as much disability as cancer, diabetes or other major medical illnesses. Traditional therapies for treating moderate-to-severe psoriasis include phototherapy, methotrexate, oral retinoids and ciclosporin. New biological treatments provide further therapeutic options, but add to the already considerable cost of managing psoriasis. Expert panels have published guidelines for the use of biological agents in managing moderate-to-severe psoriasis; however, few if any of these guidelines appropriately consider the cost-effectiveness of treatment options. When considering cost-effectiveness in addition to safety and efficacy, ultraviolet Type B phototherapy seems to be the best first-line agent for the control of moderate-to-severe psoriasis, despite a small potential for cumulative toxicity. The biologics should be considered as second-line agents alongside the traditional systemic treatments when phototherapy proves to be ineffective or is otherwise contraindicated, such as in patients with psoriatic arthritis.