A hot-melt extruded composition having finely divided drug-containing particles dispersed within a polymeric and/or lipophyllic carrier matrix is provided. The carrier softens or melts during hot-melt extrusion but it does not dissolve the drug-containing particles during extrusion. As a result, a majority or at least 90% wt. of the drug-containing particles in the extrudate are deaggregated during extrusion into essentially primary crystalline and/or amorphous particles. PEO is a suitable carrier material for drugs insoluble in the solid state in this carrier. Various functional excipients can be included in the carrier system to stabilize the particle size and physical state of the drug substance in either a crystalline and/or amorphous state. The carrier system is comprised of at least one thermal binder, and may also contain various functional excipients, such as: super-disintegrants, antioxidants, surfactants, wetting agents, stabilizing agents, retardants, or similar functional excipients. A hydrophilic polymer, such as hydroxypropyl methylcellulose (HPMC E15), polyvinyl alcohol (PVA), or poloxamer, and/or a surfactant, such as sodium lauryl sulfate (SLS), can be included in the composition. A process for preparing the extrudate is conducted at a temperature approximating or above the softening or melting temperature of the matrix and below the point of solubilization of drug-containing particles in the carrier system, and below the recrystallization point in the case of amorphous fine drug particles.