Cephalon ( CEPH) announced positive results from a phase II studies of its drug Nuvigil in patients with bipolar depression, sending the company's stock price higher Tuesday.

The Frazer, Penn.-based drugmaker is preparing to launch Nuvigil in the third quarter as a treatment for excessive sleepiness due to a variety of conditions, including sleep apnea and shift work sleep disorder. Nuvigil is a follow-on version of Cephalon's Provigil, the company's top-selling drug with 2008 sales of $988 million. Provigil is scheduled to lose patent protection in 2012.

In Tuesday's phase II study, patients with bipolar depression treated with Nuvigil showed improvement in depressive symptoms compared to patients treated with placebo, Cephalon said. Patients in the study were treated with Nuvigil or placebo in combination with other mood-stabilizing drugs.

Nuvigil was generally well-tolerated in the study, Cephalon reported. The incidence of mania, hypomania, depression and suicidal ideation were comparable between the Nuvigil and placebo groups. There were two serious adverse events of mania in the placebo group but none in the Nuvigil group.

An estimated two million American adults are affected by bipolar I disorder, which is characterized by fluctuations between extreme highs (manic) and lows (depressed) in mood. People with bipolar disorders cycle between periods of manic or depressive mood and typically spend more time in the depressed phase of the illness.

Cephalon said it plans to conduct phase III trials of Nuvigil as a treatment for bipolar depression.

Cephalon shares were up 5.7% to $66.80 in recent trading.

Other companies with drugs for bipolar disorder include Bristol-Myers Squibb ( BMY), Johnson & Johnson ( JNJ) and Pfizer ( PFE).

Adam Feuerstein writes regularly for TheStreet.com. In keeping with TSC's editorial policy, he doesn't own or short individual stocks, although he owns stock in TheStreet.com. He also doesn't invest in hedge funds or other private investment partnerships. Feuerstein appreciates your feedback; click here to send him an email.

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