Known as Dimebon, the drug was first discovered in 1983 and sold in Russia as an antihistamine, but was dropped when better treatments came on the market.
A few years ago, interest in the drug picked up when lab tests by researchers at the Russian Academy of Sciences showed it to have a protective effect on brain cells.
The news was picked up by an entrepreneurial company in San Francisco, which funded further work.
After further experiments on lab animals and a small-scale trial on humans, scientists have now carried out a trial on a relatively large group of people diagnosed with mild-to-moderate Alzheimer's.
In this neurodegenerative disease, brain cells are killed by a build up of toxic plaques and tangled proteins, leading to forgetfulness, mood swings, dementia and death.
The team enrolled 155 patients at 11 sites in Russia, who were given a dose of Dimebon three times a day or a harmless lookalike pill called a placebo.
They were assessed according to a scale to measure cognitive abilities and memory.
After the six months on this regime, the patients were assessed again. After that, 134 of them took part in a 26-week extension, and were assessed once more.
At both phases of the experiment, the Dimebon group "significantly improved" compared to the start of the experiment, while the placebo group showed clear deterioration, the researchers say.
Dimebon "was well tolerated," with dry mouth or depressed mood the most frequent adverse events.
Around 25 million people around the world have Alzheimer's, for which there is no cure, only an array of treatments that are considered moderately effective and likely to have side effects.
On its website, Medivation, which is also testing Dimebon for people with Huntington's disease, said a wider, Phase III trial in testing the drug for Alzheimer's is underway.
Lead researcher in the trial is Rachelle Doody, of the Alzheimer's Disease and Memory Disorders Center at the Baylor College of Medicine in Houston, Texas.
The project was vetted to ensure it met US and Russian standards of ethics and objectivity, and the study, presented at a conference last year, was peer-assessed before appearing in the latest issue of The Lancet.
Doody has had to fight skepticism within the medical community about Dimebon given the unusual way in which the drug was rediscovered, according to the medical media.
Researchers are also cautious about the drug's effectiveness until they see how it performs against existing treatment in clinical trials. They stress that, like other drugs, Dimebon appears to treat symptoms of the disease but not the underlying causes and thus is not a cure.