In an unusually extensive collaboration between an academic institution and a drug maker, Vanderbilt University will partner with Janssen Pharmaceutica NV, a unit of drugmaker Johnson & Johnson to develop new drugs to treat schizophrenia.

The University in Tennessee will receive about $10 million from J&J over the next three years, plus as much as $100 million in additional payments if it meets certain research objectives, and through royalties in product sales.

This would not be the first time when a university would work on a research project with a pharmaceutical company. Usually, a drug maker funds a university's basic scientific research in exchange for first rights to buy any commercially promising compounds that result.

But outside researchers said the Vanderbilt-J&J partnership appears to be more extensive than historical university-industry alliances. Under the agreement, Vanderbilt's researchers won't just identify promising molecules. Instead, they will develop drugs to the stage where they are ready for human testing, working, for example, to make a prospective medicine less toxic. This process is known as "drug optimization", and is usually performed by the biotechnology or pharmaceutical companies themselves.

The partnership, which represents a small outlay for J&J, comes amid growing interest among drug companies and some universities in working together more closely. The pharmaceutical industry is being battered by generic competition as it struggles to develop new drugs, while academic researchers have been competing for stagnant federal research funding.

In the opinion of the supporters, the academic world and the drug industry can both benefit from working together. As Big Pharmaceuticals struggle to refill their product pipeline and biotech companies face financing challenges, fostering more extensive collaboration with universities may be a more efficient way for drug makers to usher new medicines to market.

A government-funded "molecule library" established in 2004 has allowed academic researchers to comb through thousands of potential compounds -- much as drug companies search through proprietary libraries -- to discover research leads, says Thomas Insel, director of the federal National Institute of Mental Health.

The Belgium-based company will organize clinical trials to test discovered drugs on patients with schizophrenia.