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Preclinical studies with metabotropic glutamate (mGlu) type 2 receptor agonists have shown promising results in the treatment of anxiety. The mGlu receptor agonist LY354740 has shown anxiolytic properties in animal models of anxiety. We present the results obtained with LY354740, in a placebo-controlled double-blind randomized study with paroxetine as an active comperator in outpatients with panic disorder. This study was part of a multicentre phase II efficacy study. Patients were randomly assigned to receive LY354740 (100 or 200 mg), paroxetine (60 mg) or placebo for 9 weeks. The primary outcome parameter was the percentage of patients having no panic attacks during the final 3 weeks of treatment. Secondary outcome measures were the Panic Disorder Severity Scale (PDSS) and the clinical global impression (CGI). Patients treated on paroxetine improved on the PDSS and CGI but, due to small sample size, these effects just failed to reach statistical significance. LY354740 was well tolerated (with gastrointestinal complaints as the most common side-effects) but failed to show treatment effects that were different from placebo. Because preclinical data collectively indicate anxiolytic properties of mGlu type 2 receptor agonists, clinical studies with other agents are warranted.