I'm making a GM call that creatures and objects created by the hallucinations are Constructs, they are generated and given shape by James and his mind. As such, when James' attention shifts, they simply cease to exist. They exist in the physical world only for as long as they exist within his mind.

This also means that knocking out James, or killing him, would instantly destroy anything created by his delusions. Much in the way that water only maintains the shape of it's container, the container being formed from James' mind.

This can, of course, be debated if anyone has different opinions on this matter.