This is a Phase 2, randomized, double-blinded, placebo-controlled, inpatient study to examine the efficacy, safety, and tolerability profile of KarXT in adult subjects diagnosed with DSM-5 schizophrenia who are in an acute exacerbation phase. The primary objective of the study is to assess the efficacy of KarXT (a fixed combination of xanomeline and trospium chloride) (xanomeline 125 mg/trospium 30 mg twice daily [BID]) versus placebo in reducing Positive and Negative Syndrome Scale (PANSS) total scores in adult inpatients with a Diagnostic and Statistical Manual-Fifth Edition (DSM-5) diagnosis of schizophrenia. The secondary objectives of the study are to assess overall safety and tolerability of KarXT in adult inpatients with a DSM-5 diagnosis of schizophrenia.

Inclusion Criteria:

1. Subject is aged 18-60 years, inclusive, at screening

2. Subject has a primary diagnosis of schizophrenia established by a comprehensive psychiatric evaluation based on the DSM-5 (American Psychiatric Association 2013) criteria and confirmed by Mini International Neuropsychiatric Interview for Schizophrenia and Psychotic Disorder Studies (MINI) version 7.0.2.

3. Subject is experiencing an acute exacerbation or relapse of symptoms, with onset less than 2 months before screening

4. Positive and Negative Syndrome Scale total score between 80 and 120, inclusive, at screening

   1. Score of ≥ 4 (moderate or greater) for ≥ 2 of the following Positive Scale (P) items at screening:
   2. Item 1 (P1; delusions)
   3. Item 2 (P2; conceptual disorganization)
   4. Item 3 (P3; hallucinatory behavior)
   5. Item 6 (P6; suspiciousness/persecution)

5. There should not be a change (improvement) in PANSS total score between screening and baseline of more than 20%

6. Subjects taking a depot antipsychotic could not have received a dose of medication for at least 1 and a half injection cycles before baseline (eg, 3 or more weeks off for a 2-week cycle)

7. Subject is capable of providing informed consent

   1. A signed ICF must be provided before any study assessments are performed
   2. Subject must be fluent (oral and written) in English in order to consent

8. Subject must have CGI-S score of ≥ 4 at screening and baseline visits

9. Body mass index must be ≥ 18 and ≤ 40 kg/m2

10. Both females of child bearing potential and males with partners of child bearing potential must be willing to use a double-barrier method of birth control (ie, any double combination of male or female condom with spermicidal gel, diaphragm, sponge, or cervical cap with spermicidal gel) during the study and for 7 days after the last dose of study drug.

11. Subject has an identified reliable informant

Exclusion Criteria:

1. Any primary DSM-5 disorder other than schizophrenia within 12 months before screening (confirmed using MINI version 7.0.2 at screening)
2. History or presence of clinically significant cardiovascular, pulmonary, hepatic, renal, hematologic, gastrointestinal, endocrine, immunologic, dermatologic, neurologic, or oncologic disease or any other condition that, in the opinion of the investigator, would jeopardize the safety of the subject or the validity of the study results, to exclude patients with human immunodeficiency virus (HIV), cirrhosis, biliary duct abnormalities, hepatobiliary carcinoma, and/or active hepatic viral infections based on the liver function test results.
3. History of or high risk of urinary retention, gastric retention, or narrow-angle glaucoma
4. History of irritable bowel syndrome (with or without constipation) or serious constipation requiring treatment within the last 6 months
5. Has a DSM-5 diagnosis of moderate to severe substance abuse disorder (except tobacco use disorder) within the 12 months before screening (confirmed using MINI version 7.0.2 at screening), or current abuse as determined by urine toxicology screen or alcohol test. A screening subject with mild substance abuse disorder within the 12 months before screening must be discussed and agreed upon with the medical monitor before he/she can be allowed into the study.
6. Clinically significant abnormal finding on the physical examination, medical history, ECG, or clinical laboratory results at screening
7. Pregnant, lactating, or less than 3 months postpartum. Sperm donation is not allowed for 90 days after the final dose of study drug
8. If, in the opinion of the investigator (and/or Sponsor), subject is unsuitable for enrollment in the study or subject has any finding that, in the view of the investigator (and/or Sponsor), may compromise the safety of the subject or affect their ability to adhere to the protocol visit schedule or fulfill visit requirements
9. Subject has had psychiatric hospitalization(s) for more than 30 days (cumulative) during the 90 days before screening
10. Subject has a history of treatment resistance to schizophrenia medications defined as failure to respond to 2 adequate courses of pharmacotherapy (a minimum of 4 weeks at an adequate dose per the label) or required clozapine within the last 12 months
11. Risk of violent or destructive behavior
12. Current involuntary hospitalization or incarceration
13. Participation in another clinical study in which the subject received an experimental or investigational drug agent within 3 months of screening