The purpose of this study was to discriminate the release behavior from three differently formulated racecadotril (BCS II) granules and to establish an in vitro-in vivo correlation. Three granule formulations of the lipophilic drug were prepared with equivalent composition but prepared with different manufacturing processes (dry granulation, wet granulation with or without binder). In vitro release of the three granules was investigated using a biphasic dissolution system (phosphate buffer pH 6.8 and octanol) and compared to the conventional single phase USP II dissolution test performed under sink and non-sink conditions. In vivo studies with each granule formulation were performed in rats. Interestingly, the granule formulations exhibited pronouncedly different behavior in the different dissolution systems depending on different wetting and dissolution conditions. Single phase USP II dissolution tests lacked discrimination. In contrast, remarkable discrimination between the granule formulations was observed in the octanol phase of biphasic dissolution system with a rank order of release from granules prepared by wet granulation with binder > wet granulation without binder > dry granulation. This release order correlated well with the wettability of these granules. An excellent correlation was also established between in vitro release in the octanol phase of the biphasic test and in vivo data (R2 = 0.999). Compared to conventional dissolution methods, the biphasic method provides great potential to discriminate between only minor formulation and process changes within the same dosage form for poorly soluble drugs.