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BACKGROUND: The Disease Recovery Evaluation and Modification study (DREaM; NCT02431702) assessed the benefit of initiating paliperidone palmitate (PP), a long-acting injectable antipsychotic, in patients with recent-onset schizophrenia or schizophreniform disorder. OBJECTIVE: To determine whether reductions in psychiatric hospitalizations with early initiation of PP vs oral antipsychotic (OAP) therapy observed in a DREaM post hoc analysis are transportable to a real-world population of patients with recent-onset schizophrenia. METHODS: Patients enrolled in DREaM were randomized to receive OAP or PP for 9 months, after which OAP recipients were re-randomized to receive OAP or PP for another 9 months. We used this design to form treatment arms: OAP-OAP, OAP-PP, and PP-PP. Inclusion/exclusion criteria were used to identify a Medicaid Managed Care (MMC) OAP-treated cohort of 1,000 patients diagnosed with schizophrenia using IBM Truven databases from 2015 to 2019. The MMC cohort was combined with the subset of patients diagnosed with schizophrenia enrolled in DREaM from US sites (N = 45, 43, and 44 for OAP-OAP, OAP-PP, and PP-PP, respectively). Propensity scores for the MMC cohort were estimated using baseline variables identified via double-lasso regression. Estimated propensity scores were used to weight psychiatric hospitalizations in the DREaM OAP-OAP group and compared with observed MMC OAP cohort psychiatric hospitalizations. After the successful calibration of the DREaM OAP-OAP group, similar approaches were taken for the OAP-PP and PP-PP groups to transport DREaM effects to MMC data. RESULTS: Standardized mean differences in baseline covariates between DREaM treatment arms and MMC groups were substantially reduced after calibration. The 18-month cumulative numbers of psychiatric hospitalizations per patient (SE) were 0.83 (0.14) for the MMC cohort, 0.43 (0.14) for the unweighted OAP-OAP, and 0.80 (0.37) for the calibrated OAP-OAP. The difference between the calibrated OAP-OAP and MMC was not statistically significant (difference, 0.03 [95% CI = -0.67 to 0.81]), indicating successful calibration. The mean difference in 18-month cumulative psychiatric hospitalizations relative to the MMC cohort was -0.77 (95% CI = -1.08 to -0.47) for OAP-PP and -0.83 (95% CI = -1.15 to -0.60) for PP-PP. CONCLUSIONS: Our study demonstrates that results from the DREaM OAP-OAP group reflect psychiatric hospitalizations in a real-world population when calibrated using specific baseline characteristics. Transporting the DREaM effects, we find that using OAP-PP and PP-PP treatment strategies for patients with recent-onset schizophrenia in the MMC population could reduce psychiatric hospitalizations compared with the use of OAP. These findings, along with the potential reduction in associated costs, should be considered when assessing the value of PP formulations. DISCLOSURES: Dr Basu reports consulting fees through Salutis Consulting LLC related to this work. Dr Mavros is a former employee of the Janssen Pharmaceutical Companies of Johnson & Johnson, Inc, and holds stock in the company. Ms Benson, Dr Fu, Ms Patel, and Dr Brown are employees of Janssen Scientific Affairs, LLC, and hold stock in Johnson & Johnson. This research was funded by Janssen Scientific Affairs, LLC. The sponsor was involved in the study design; collection, analysis, and interpretation of data; and development and review of the manuscript. All authors had full access to the study data and take responsibility for data integrity and the accuracy of the analyses. All authors provided direction and comments on the manuscript, reviewed and approved the final version prior to submission, made the final decision about where to publish these data, and approved submission to this journal.