Used primarily as a pharmaceutical intermediate in the synthesis of antipsychotic drugs, particularly in the production of risperidone and its active metabolite paliperidone. It serves as a key building block due to its structural similarity to the core benzisoxazole moiety found in these medications. Its amine group allows for further chemical modifications, enabling the formation of amide or substituted amine derivatives critical in drug development. It is also explored in research for novel CNS-active compounds owing to its ability to cross the blood-brain barrier and interact with dopamine and serotonin receptors.