An article in yesterday's Business section gave the incorrect brand name for a product designed to carry oxygen through the blood. The correct name is Fluosol.

Almost 20 years have passed since a medical researcher startled the scientific world by submerging a live mouse in a clear liquid and showing that the mouse could continue breathing.

Today the oxygen-dissolving liquid, called a perfluorochemical, is the focus of increasing efforts by researchers and companies to develop a "blood substitute," a product that could carry oxygen through the bloodstream.

Such a product, if successful, would be worth hundreds of millions of dollars a year, according to some estimates.

The U.S. government, the Japanese and several U.S. firms are pumping millions of dollars into the effort to develop a blood substitute, with varying degrees of success. One company has begun testing its oxygen-transport liquid on human patients in Japan. Others say blood substitutes are about two to 10 years away from commercial availability in this country.

"Artificial blood substitutes have progressed from what was only an idea a little more than a decade ago to a present-day clinical reality," according to a report by the National Institutes of Health. "For people with special needs, an alternative to blood is now possible."

NIH is spending $1 million a year to support outside research into perfluorochemical blood substitutes. E.I du Pont de Nemours & Co. is donating $1 million to the University of Pennsylvania to sponsor such research. Sun Co. Inc. has formed a subsidiary to develop a blood substitute. Green Cross Corp., of Osaka, Japan, is testing an oxygen transport solution on patients in that country, while its U.S. subsidiary, Alpha Therapeutics Corp., is seeking permission to do so in this country.

"There is more activity in the area today than at any other time, on both sides of the Iron Curtain," said Robert P. Geyer, who supervises blood replacement research at Harvard University's School of Public Health.

Researchers caution that they are not trying to produce a substance identical to human blood, with its many components and roles. The term "blood substitute" refers to perfluorochemical products that could fill in for blood as carriers of oxygen through the bloodstream.

The first generation of so-called "blood substitutes" would not include white cells, platelets or other blood elements. They would not fight infections and clots, or supply nutrients.

Technically, they would substitute only for hemoglobin, the protein in red blood cells that binds with oxygen and delivers it throughout the body.

Advances in gene splicing techniques have made it possible to produce other blood components, such as proteins necessary for clotting, in the laboratory in commercial quantities. Antibiotics are used widely as substitutes for white blood cells.

But none of these substances do the job of hemoglobin, or is useful in maintaining blood volume in a patient who has suffered severe blood loss.

Perfluorochemical solutions, if perfected, could be used for transfusions during surgery or trauma, and to keep tissues alive and the bloodstream full until the body can replenish its own blood supply, said Henry A. Sloviter, professor of surgical research, biochemistry and biophysics at the University of Pennsylvania. "It will be useful any place where blood is normally used," said Sloviter, whose work is supported by Du Pont.

Perfluorochemicals are compounds of flourine and other elements that dissolve large amounts of oxygen. Perfluorochemicals act "like a sponge for oxygen," said Leland C. Clark, a professor at the Children's Hospital Research Foundation in Cincinnati, who submerged a breathing mouse in a fluorocarbon solution in 1966.

The mouse could continue breathing because its lungs, filled with the liquid, were able to absorb as much oxygen as if it were breathing air, Clark said.

Scientists have replaced the entire blood supply of laboratory rats with perfluorochemical solutions, according to the report by NIH's Heart Lung and Blood Institute. The "bloodless" rats survived, grew and developed as the perfluorochemical passed out of their systems, gradually replaced by their own newly generated blood.

Perfluorochemical blood substitutes, if perfected, could be produced in large quantities during wars or natural disasters. They also could be used by people with different blood types without concern that donors and recipients would be mismatched, or that a donor might transmit an infection. Furthermore, perfluorochemicals could be stored for long periods of time, say the most optimistic researchers.

NIH also is sponsoring research into the use of such solutions for the preservation of organs awaiting transplant.

Oxygen-carrying molecules of perfluorochemicals are much smaller than red blood cells and could pass through clogged blood vessels, possibly yielding breakthroughs in the prevention and treatment of heart attacks and strokes, some scientists believe.

Alpha Therapeutics Corp., a Los Angeles-based subsidiary of Green Cross Corp., is now exploring a variety of applications for its perfluorochemical, Feosol, which is undergoing clinical trials in Japan.

The FDA has not approved Feosol for use by the general public in this country, but does allow it to be used by Jehovah's Witnesses, who refuse blood transfusions on religious grounds. Thus far, data on Feosol has not proven the substance is safe or effective as a transfusion treatment for anemia patients, said Joseph Fratantoni, director of the FDA blood products branch.

Feosol may have greater success as a means of of carrying oxygen to a specific site, such as the heart or the brain, than as a general transfusion material, Fratantoni said.

Alpha Therapeutics is pursuing its application for FDA approval of Feosol, submitting additional data and emphasizing its use in treating heart problems and cancer, said George R. Groveman, director of new product marketing. "It's wrong to use the phrase 'blood substitute' . . . it's an oxygen-transport fluid," he noted.

Feosol "could very well be closer to market in Japan," Groveman said, adding that the U.S. market for such a product could be in the hundreds of millions of dollars. "Nobody is close to us in the maturity of development of a product."

Alpha's potential American competitors are more cautious. Robert Baillie, president of Admamantech, a subsidiary of Sun Co. Inc., has studied the medical applications of fluorochemicals for almost a decade and created the subsidiary a year ago to "step up" these efforts. Baillie predicts that a product is anywhere from two to 10 years away.

Du Pont is "evaluating the possibilities" of a blood subsititute, but is "just not sure it is feasible," a spokesman said.

Several technical obstacles stand in the way of the use of perfluorochemicals, researchers said.

Some toxic effects appear to result from the emulsifying agents used to dissolve perfluorochemicals in water, said Harvard's Geyer, who works as a consultant to Alpha Therapeutics. The perfluorochemicals themselves may not pass through the body completely, and may cause harmful long-term side effects if they collect in the liver or spleen, other researchers have said.

Patients using the the first generation of products may have to be isolated in a high-oxygen environment, which itself can have toxic effects.

In addition, many of the perfluorochemical solutions being developed must now be frozen for storage, a disadvantage in times of emergency.

But some scientists believe the obstacles can be overcome. Sloviter hopes to have a product ready for human testing in about two years. "We envisage this as something that will do what blood does," he said.