The promise of profit in neurobiology is exciting the neurons of venture capitalists all over the country (see accompanying story). It’s also stimulating gray matter at the stoic nerve centers of the pharmaceutical giants. Although they may be loathe to admit it, beneath the traditionally calm exterior at these companies, synapses—and scientists—are jumping.

Some of the large companies, of course, have been searching for drugs that affect the central nervous system for years. Hoffman-LaRoche’s efforts date back to the 1950s, for example, and count among their notable successes such synthetic compounds as Valium and Librium. Another company, Warner-Lambert, joined the fray in the early 1970s.

But now the competition is heating up. The big pharmaceuticals are serving up bigger slices of their R&D pies to their brain researchers—and are even joining forces with the entrepreneur. The region is simple: Like their younger siblings, the major drug companies recognize that new...

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