PHILADELPHIA -- Bristol-Myers Squibb Co. finally has some good news, in the form of a promising antipsychotic called aripiprazole.

The drug is a candidate to treat schizophrenia, apparently without some of the serious side effects of other antipsychotics. That advantage could translate into more than $1 billion in sales in the hot market for antipsychotics -- sales the New York-based company desperately needs as it struggles with some of its biggest-selling drugs coming off patent.

Wednesday, Bristol-Myers presented five studies at the American Psychiatric Association meeting here highlighting the effectiveness and safe side-effect profile of aripiprazole. The company positioned it as a next-generation drug for schizophrenia and other psychoses because it works by modifying levels of a key chemical in the brain.

"It's a drug that's not too hot, it's not too cold. It's a Goldilocks-like drug," said Jeffrey Lieberman, a professor of psychiatry at the University of North Carolina in Chapel Hill who has worked on the studies.

Discovered by a Japanese scientist, aripiprazole in scientific parlance is a partial agonist. That means it binds to the brain's tiny receptors for the chemical dopamine; but instead of fully blocking or stimulating the receptors, as other drugs do, aripiprazole exerts a little of both actions. In patients with schizophrenia whose dopamine levels are too high in some parts of the brain and too low in others, this is an important advantage, Dr. Lieberman says.

Because aripiprazole doesn't block dopamine receptors altogether, the molecule doesn't appear to cause the stiffness and tremors that characterized the first generation of schizophrenia drugs and patients. And because it doesn't bind to some other receptors in the brain, it doesn't seem to cause the troubling side effects including weight gain, sexual dysfunction and an increased risk of diabetes common in some second-generation antipsychotics that are big sellers today.

About two million Americans suffer from schizophrenia, a disease that causes hallucinations and delusions and that is frequently progressive. Drugs to treat the disease have been blockbusters, and companies such as Eli Lilly & Co. and Johnson & Johnson have depended on their profits to fuel corporate growth for years.

Still, the reality is most patients don't recover fully and struggle with the significant side effects of the drugs. At the psychiatric association's meeting this week, many sessions have focused on the health risks associated with these side effects that include substantial weight gain, higher cholesterol levels and an increased risk of diabetes. Depending on the drug, side effects also include stiffness and tremors, a slightly slower heartbeat and sexual dysfunction.

"We're realizing the health of the mentally ill is terrible and we need to give it much more attention," said Philip Muskin, the Columbia University psychiatrist who is chairman of the meeting.

Bristol-Myers submitted its application to the U.S. Food and Drug Administration for aripiprazole late last year and hopes for approval to market the drug sometime this year. The company is co-developing the drug with the Japanese firm Otsuka Pharmaceutical Co.

Among the presentations from Bristol-Myers Wednesday was a 26-week study of 310 patients with schizophrenia showing aripiprazole was effective in controlling symptoms compared with a placebo. Fewer patients, or 34% of those taking the drug, had a recurrence of symptoms while taking the drug, compared with 57% on the placebo, the company said. A study in 311 patients suggested they could be switched from other drugs to aripiprazole without difficulty.

The company also put together an analysis of the results of several trials involving more than 3,000 patients to show aripiprazole didn't cause any significant weight gain compared with the leading antipsychotics. In one of the trials of 26 weeks, Bristol-Myers reported patients on Zyprexa gained an average of 4.4 kilograms (9.7 pounds) while those on aripiprazole lost 2.2 kilograms (4.9 pounds).

Mary Kujawa, a psychiatrist who works for Bristol-Myers, says the most common side effects from aripiprazole in clinical trials are nausea and sedation in a small fraction of the patients that decrease as they adjust to the drug.

Overall, the results indicate the drug works about as well as those on the market in controlling the symptoms of schizophrenia, says Dr. Lieberman. "There's no indication yet that it works better -- the key advantage appears to be fewer side effects." But he added that all of the side effects of a drug are never really known until it gets to market and hundreds of thousands of people take it.

Samuel Isaly, managing partner of OrbiMed Advisers LLC, which runs biotechnology and pharmaceutical funds, notes the importance of aripiprazole to Bristol-Myers. With its promising cancer drug Erbitux delayed, and data for the hypertension drug Vanlev looking mediocre, aripiprazole is "their biggest remaining candidate in the near term," he says.

"The drug has a multibillion-dollar potential," he says, but it's no sure bet. Bristol-Myers's rivals "are not going to roll over and play dead," he says.

Write to Geeta Anand at geeta.anand@wsj.com¹

Updated May 23, 2002