Alexza Pharmaceuticals (NASDAQ:ALXA) has scheduled phase 3 testing of its lead drug to begin in the first quarter of 2008.

With two trials each enrolling some 300 patients, the company estimates the trials will be concluded in about 18 months, so that puts the next set of data available in the latter half of 2009.

Alexza is focused on producing aerosolized versions of injectable or oral drugs that are already on the market and facing generic competition. It's best known for being founded by entrepreneur extraordinaire Alejandro Zaffaroni.

Alexza's lead drug is an aerosolized version of the genericized antipsychotic agent loxapine. Loxapine is an injectable drug, and Alexza theorizes that its inhalable version, named AZ-004, will provide schizophrenic patients faster relief and more convenient dosing.

In phase 2 testing, Alexza proved that AZ-004 was effective versus placebo in treating schizophrenics' symptoms. The phase 3 trials will enroll twice as many people as the phase 2 trials.

The question surrounding Alexza's drugs in development is whether there really will be a market for them if they can get approved. As even Alexza notes, injectable antipsychotic medications often are given to uncooperative patients. An inhaled version of loxapine would be harder to give to an unwilling patient, such as a schizophrenic in a panic attack, which is what the drug is being tested for. With phase 3 testing just around the corner, we may find out soon enough whether the drug can compete with injectable drugs such as Pfizer's (NYSE:PFE) Geodon and Eli Lilly's (NYSE:LLY) Zyprexa.

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Fool contributor Brian Lawler does not own shares of any company mentioned in this article. The Fool's disclosure policy has a bad case of tellitlikeitis-itus.