BACKGROUND: Given relapse frequency early in the course of schizophrenia, recently diagnosed patients may benefit from longacting injectable antipsychotics, which are associated with reduced risk of relapse and hospitalization compared with oral antipsychotics (OAPs). OBJECTIVE: To compare health care resource utilization (HCRU) and costs in patients with recent-onset schizophrenia treated with continuous paliperidone palmitate (PP) or continuous OAP or who switched from OAP to PP. METHODS: In this analysis, we combined the 2 randomized phases of the prospective, open-label Disease Recovery Evaluation and Modification (DREaM) clinical study using the principal stratification method to generate 3 treatment strategies: continuous PP for 18 months (PP-PP), continuous OAP for 18 months (OAP-OAP), and initial OAP switched to PP after 9 months (OAP-PP). HCRU metrics included psychiatric hospitalizations, psychiatric and nonpsychiatric emergency department visits, and ambulatory visits. Costs were analyzed using generalized linear models with inverse-probability weighting based on time-varying probabilities of exposure. Robust SEs were estimated using individual-level clustered bootstrapping. Subgroup analyses were performed by region and prior antipsychotic use (< 6 vs ≥ 6 months). RESULTS: A total of 181 patients were included in the PP-PP (n = 61), OAP-OAP (n = 61), and OAP-PP (n = 59) groups. The majority of patients (73%) were enrolled at study sites in the United States, and 48% had received an antipsychotic for less than 6 months prior to study entry. Baseline characteristics were well balanced, and no significant differences in discontinuation rates were observed across treatment strategies. Compared with OAP-OAP, significantly lower cumulative HCRU and costs were apparent before 9 months in the PP-PP group and after 9 months in the OAP-PP group. The cumulative 18-month effects of PP-PP and OAP-PP vs OAP-OAP on the number of psychiatric hospitalizations were ‒0.28 (95% CI = ‒0.51 to ‒0.08) and ‒0.27 (95% CI = ‒0.50 to 0.04), respectively, and those on cumulative mean per-patient total health care costs (in 2020 USD) were -$2,867 (95% CI = ‒$5,133 to ‒$750) and ‒$2,789 (95% CI = ‒$5,155 to ‒$701), respectively. Subgroup analyses indicated a greater reduction in psychiatric hospitalizations and costs with PP-PP or OAP-PP relative to OAP-OAP in patients with less than 6 vs 6 or more months of prior antipsychotic therapy. CONCLUSIONS: Continuous early use of PP in adults with recentonset schizophrenia significantly reduced psychiatric hospitalizations and associated estimated costs compared with OAP; these effects were particularly notable for patients with a shorter duration of prior antipsychotic use. As this was a post hoc analysis of a study that was not powered for HCRU assessments, future studies calibrating these effects to larger real-world populations will be useful. DISCLOSURES: Dr Basu reports consulting fees through Salutis Consulting LLC related to this work. Ms Benson, Dr Turkoz, Ms Patel, Dr Baker, and Dr Brown are employees of Janssen Scientific Affairs, LLC, and stockholders of Johnson & Johnson, Inc. This research was funded by Janssen Scientific Affairs, LLC. The sponsor was involved in the study design; collection, analysis, and interpretation of data; development and review of the manuscript; and decision to submit the manuscript for publication.