Used as a key intermediate in the synthesis of pharmaceuticals, particularly in the development of centrally acting agents and psychoactive drugs. Its structure allows for functionalization at the carbonyl and ring positions, making it valuable in medicinal chemistry for building constrained analogs of bioactive molecules. It is also employed in the preparation of selective receptor modulators due to the rigidity imparted by the cyclobutanone ring. Additionally, it serves as a building block in the creation of novel compounds for neurological research, including potential antidepressants and anticonvulsants.