PHD

Effects

Identifies all pills upon pickup.
Spawns a pill.
Replenishes 2 Red Hearts.
Increases the payout of Blood Donation Machines to 2-3 coins on Normal mode and 2 on Hard mode.
Increases the payout of IV Bag to 2-3 coins.
Increases the payout of IV Bag to 2-3 coins on Normal mode and 2 on Hard mode.
Converts some "bad" pills into their "good" counterparts or removes their bad effects:

Pill	Changes Into
Stat down pill	Stat up pill
Amnesia	I can see forever!
???	Telepills
Addicted	Percs!
I'm Excited!!!	I'm Drowsy...
Paralysis	Pheromones
Retro Vision	I can see forever!
R U A Wizard?	Power Pill!
X-Lax	Something's wrong...
Bad Trip	Full Health
Bad Trip	Balls of Steel
Experimental Pill	Only grants a stat up
Gold Pill	Only has positive effects
Unchanged
48 Hour Energy
Bad Gas
Bombs are Key
Explosive Diarrhea
Hematemesis
I can see forever!
I Found Pills
Lemon Party
Pheromones
Pretty Fly
Puberty
Telepills
Friends Till the End!
Infested!
Infested?
One makes you larger
One makes you small
Percs!
Power Pill!
Re-Lax
???
Addicted!
Retro Vision
Feels Like I'm Walking on Sunshine!
Gulp!
Horf!
Something's Wrong...
Vurp!
Paralysis
R U A Wizard?

Bad pills already obtained/dropped will be converted to their "good" counterparts.
If PHD is lost in any way, such as rerolling by the D4 or a Dice Room, or dropping it as Tainted Isaac, pills will remain fully identified, but negative pills will not be converted.
Performing a RERUN with a character that held PHD will still prevent negative pills from spawning, but will no longer identify pills until used.
As bad pills will turn into good pills, it is possible for two different colored pills to have the same effect.
Multiple copies of PHD will not yield more coins when using a Blood Donation Machine or IV Bag.
This item can be crafted from Bag of Crafting with eight pills.

False PHD: Pills can both be good or bad again. Taking a bad pill still applies the benefits from False PHD.
Keeper / Tainted Keeper: Blood Donation Machines will not produce more coins and they will still have a chance to fail.

PHD stands for Doctor of Philosophy (Ph.D.) and it's the most common degree at the highest academic level awarded following a course of study. Doctorates can be in any study, in Isaac's case, medicine.
MEAT!, YO LISTEN!, PHD, G FUEL!, and TMTRAINER are the only ALL CAPS items in the game.