CARY, N.C., Aug. 3 /PRNewswire-FirstCall/ -- Cornerstone Therapeutics Inc. (Nasdaq: CRTX) ("Cornerstone" or the "Company"), a specialty pharmaceutical company focused on acquiring, developing and commercializing significant products primarily for the respiratory and related markets, today announced that the Company has licensed to Targacept, Inc. ("Targacept") the worldwide rights to its nicotinic-receptor based patents and library of preclinical compounds that target the alpha-7 or other nicotinic receptors originally licensed to Cornerstone from the Feinstein Institute for Medical Research.
Under the terms of the agreement, Cornerstone will receive an upfront payment of $1.5 million and is eligible for success-based milestone payments ranging from up to $45.6 million to up to $74.9 million, depending on which of two specified lead compounds is progressed by Targacept. The potential milestone payments are comprised of $1.1 million to $1.4 million through Phase 2 clinical proof of concept, $9.5 million to $18.5 million in later-stage pre-commercialization milestones and $35.0 million to $55.0 million in sales-based milestones. If Targacept develops other compounds covered by the licensed patents, Cornerstone is also eligible for lower success-based milestone payments for each other compound. Cornerstone will receive low single digit royalties based on any future net sales of licensed products.
"We are excited to enter this agreement with Targacept for the development of our alpha-7 program, which we believe has considerable commercial potential," said Craig A. Collard, Cornerstone's President and Chief Executive Officer. "The licensing of this technology is a major step for Cornerstone, enabling us to continue to focus on our core business of developing and commercializing products in the respiratory and hospital spaces. We expect to use the proceeds from this and other transactions to fund additional product acquisitions to enhance our continued growth."
This agreement follows the announcement last month that the company has reacquired rights, in a cashless transaction, to its high-mobility group box protein 1 (HMGB1) protein-related technology, for which it also intends to seek a development and commercial partner.