Post-traumatic stress disorder (PTSD) is characterized by difficulty down-regulating emotional responses towards trauma-reminders. The neuropeptide oxytocin may enhance treatment response in PTSD, by dampening excessive fear and improving fear regulation. However, oxytocin effects on (neural correlates of) cognitive emotion regulation abilities have never been investigated in PTSD patients. Therefore, we investigated behavioral and neural effects of intranasal oxytocin administration (40IU) on distraction as emotion regulation strategy in male and female police officers with and without PTSD (n = 76), using a randomized placebo-controlled cross-over fMRI study. The distraction condition consisted of a working memory task while negative affective pictures were presented. Under placebo, male PTSD patients showed decreased right striatal activity during distraction compared to male trauma-exposed controls, which was unaffected by oxytocin. After oxytocin administration, left thalamus activity during distraction was enhanced in all participants, independent of PTSD status or sex. Although left thalamus activity during distraction did not differ between PTSD patients and controls under placebo, it was negatively correlated with error rates within PTSD patients. Furthermore, oxytocin administration increased functional connectivity between the left thalamus and amygdala in PTSD patients and male trauma-exposed controls. Upregulation of thalamus activity during distraction by oxytocin may enhance cognitive emotion regulation abilities during psychotherapy in PTSD, although this should still be investigated in a clinical setting. Our findings open an important research avenue into oxytocin effects on cognitive emotion regulation in PTSD and other psychiatric disorders characterized by deficient emotion regulation abilities. Registered in the Netherlands Trial Registry, registration number: NTR3516
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