WINSTON-SALEM, N.C. (
delivered Thursday on its promise to bag a lucrative, "Big Pharma" partnership for its experimental depression drug TC-5214.
The company and
have entered into a global collaboration for TC-5214 in depression, the companies announced jointly. The agreement comes about six weeks after Targacept presented jaw dropping, positive results from a phase II study of TC-5214 as an
The data presented in mid-October positioned TC-5214 as a potential blockbuster anti-depression drug, which is why AstraZeneca is paying a ton of cash to secure the drug's rights.
Under the agreement, AstraZeneca will make an upfront payment to Targacept of $200 million and up to an additional $540 million if specified development, regulatory and initial sale milestones are met.
Targacept will receive stepped double-digit royalties on net worldwide sales of TC-5214 and is eligible for another $500 million in milestone payments if the drug meets certain sales levels.
AstraZeneca and Targacept plan to jointly design a phase III clinical program for TC-5214 as an add-on therapy in depression to begin in the middle of 2010. The goal is to seek regulatory approval for the drug in 2012. AstraZeneca is responsible for 80% of the development costs with Targacept picking up the tab for the remaining 20%.
The two companies are also planning a phase II study to develop TC-5214 as a standalone anti-depression therapy.
Targacept shares closed Wednesday at $23.51.
TC-5214 made its
when Targacept announced top-line results from a phase II study, stating that TC-5214 was able to improve the symptoms of depression in patients who don't respond well to Celexa, a currently prescribed antidepressant marketed by
. That initial announcement sent Targacept shares soaring more than 600%.
The huge potential of TC-5214 was
when details from this phase II study were presented at a medical meeting. Depression patients treated with the combination of TC-5214 plus Celexa demonstrated a
improvement on the Hamilton Rating Scale for Depression, or HAM-D, compared to patients treated with Celexa alone.
To put the data in perspective, expectations going into the data presentation were for TC-5214 to boost HAM-D scores by two or three points.
The stellar efficacy data, coupled with a relatively clean safety profile, positioned TC-5214 as potentially superior to Abilify, a blockbuster drug from
which was recently approved as an add-on, anti-depression therapy.
In an interview after the TC-5214 data were presented in October, Targacept CEO Don DeBethizy told
that "two-thirds of depressed people do not achieve relief from an SSRI alone -- that's more than 9 million people. We believe that a well-tolerated drug like TC-5214 as add-on therapy will be a major breakthrough for these patients."
SSRIs are the most common class of anti-depressant drugs prescribed by doctors today.
DeBethizy said at that time that interest from Big Pharma for TC-5214 was strong and the company planned on landing a deal for the drug soon. TC-5214 was definitely high, if not tops, on the list of drugs with the
on lucrative terms in the near future.
Thursday, Targacept brought that big deal home.
-- Reported by Adam Feuerstein in Boston
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