We examined the inhibitory effect of AG-17, a potent inhibitor of protein tyrosine kinase activity on injury-induced vascular SMC proliferation by polymeric-based, periadventitial controlled release implant in the balloon catheter carotid injury model in rats. The AG-17 delivery system was formulated from ethylenevinyl acetate copolymer and the release kinetics as well as drug stability were determined. Polymeric matrices containing 2 or 10% AG-17 were implanted perivascularly in rats following balloon catheter injury. Western blot analysis of explanted arterial segments revealed enhanced tyrosine phosphorylation in injured arteries that was essentially reduced to normal levels in treated arteries. The mean neointima to media ratios were significantly reduced in both 2% (0.79 +/- 0.17, n = 9, P < 0.02) and 10% AG-17 (0.59 +/- 0.09, n = 12, P < 0.001) groups in comparison to the control group (1.38 +/- 0.18, n = 16). The mean areas of the media in the control and the 2% AG-17 group did not differ significantly but a significant reduction of the mean area of the media was observed in 10% AG-17 group. Embedding of the unstable tyrphostin compound, AG-17, in a hydrophobic matrix stabilizes the drug both in vitro and in vivo, and allows delivery-rate modulation as well as protracted site-specific therapy. Perivascular controlled release delivery of the tyrphostin AG-17 inhibits neointimal formation in the rat carotid injury model.