BMS-299897 is a gamma-secretase inhibitor that has the potential for treatment of Alzheimer's disease. The metabolism of [(14)C]BMS-299897 was investigated in human liver microsomes, in rat, dog, monkey and human hepatocytes and in bile duct cannulated rats. Seven metabolites (M1-M7) were identified from in vitro and in vivo studies. LC-MS/MS analysis showed that M1 and M2 were regioisomeric acylglucuronide conjugates of BMS-299897. Metabolites M3, M4 and M6 were identified as monohydroxylated metabolites of BMS-299897 and M5 was identified as the dehydrogenated product of monooxygenated BMS-299897. In vivo, 52% of the radioactive dose was excreted in bile within 0-6 h from bile duct cannulated rats following a single oral dose of 15 mg/kg of [(14)C]BMS-299897. Glucuronide conjugates, M1 and M2 accounted for 80% of the total radioactivity in rat bile. In addition to M1 and M2, M7 was observed in rat bile which was identified as a glucuronide conjugate of an oxidative metabolite M5. For structure elucidation and pharmacological activity testing of the metabolites, ten microbial cultures were screened for their ability to metabolize BMS-299897 to form these metabolites. Among them, the fungus Cunninghamella elegans produced two major oxidative metabolites M3 and M4 that had the same HPLC retention time and mass spectral properties as those found in in vitro incubations. NMR analysis indicated that M3 and M4 were stereoisomers, with the hydroxyl group on the benzylic position. However, M3 and M4 were unstable and converted to their corresponding lactones readily. Based on x-ray analysis of the synthetically prepared lactone of M3, the stereochemistry of benzylic hydroxyl group was assigned as the R configuration. Both the hydroxy metabolites (M3 and M4) and the lactone of M3 showed gamma-secretase inhibition with IC(50) values similar to that of the parent compound. This study demonstrates the usefulness of microbial systems as bioreactors to generate metabolites of BMS-299897 in large quantities for structure elucidation and activity testing. This study also demonstrates the biotransformation profile of BMS-299897 is qualitatively similar across the species including rat, dog, monkey and human which provides a basis to support rat, dog and monkey as preclinical models for toxicological testing.