Targacept, Inc. (NASDAQ: TRGT), a clinical-stage biopharmaceutical company developing novel NNR Therapeutics™, today announced top-line results from two separate exploratory Phase 2 studies of its product candidate TC-6987 conducted in the United States, one in asthma and one in type 2 diabetes. In the asthma study, oral TC-6987 met protocol-defined success criteria (one-sided p < 0.1) on both co-primary outcome measures, change from baseline in forced expiratory volume for adjunct TC-6987 compared to adjunct placebo measured at two time points on day 28 (51ml and 58ml). In the type 2 diabetes study, the primary outcome measure, change in fasting plasma glucose, was not met, and Targacept will not pursue further development of TC-6987 as a treatment for diabetes. TC-6987 is a modulator of the alpha7 neuronal nicotinic receptor (NNR) discovered by Targacept scientists using Pentad™, the company’s proprietary drug discovery platform. “The exploratory asthma trial of TC-6987 as an adjunct to a low-dose inhaled corticosteroid showed a drug effect that was seen at the first assessment point, 30 minutes after initial dosing, and was sustained throughout the duration of the study, suggesting that TC-6987 has promise and may also have benefit in a monotherapy setting,” said James F. Donohue, M.D., Professor of Medicine at the University of North Carolina, School of Medicine, Department of Medicine in Chapel Hill. “With the positive outcome in our TC-6987 asthma study, we have accomplished our goal of detecting in patients a signal of the potential of NNR Therapeutics in the treatment of disorders outside of the CNS, while at the same time further establishing a favorable safety and tolerability profile for this alpha7-selective NNR Therapeutic,” said J. Donald deBethizy, Ph.D., Targacept’s President and Chief Executive Officer. TC-6987 was generally well tolerated in both studies reported today. There were no clinically meaningful changes in cardiovascular parameters in either study, an important finding that differentiates TC-6987 from many other alpha7 modulators. There were no treatment-emergent adverse events that led to discontinuation in the TC-6987 dose group in the asthma study and no clinically significant difference in the number of treatment-emergent adverse events that led to discontinuation between the TC-6987 and placebo dose groups in the type 2 diabetes study. Adverse events reported in at least five percent of patients in the TC-6987 dose group and at least twice as often as in the placebo dose group occurred only in the type 2 diabetes study and were hyperglycemia (5%) and dizziness (5%). There was one serious adverse event in each dose group in the asthma study, and one serious adverse event in the TC-6987 dose group in the type 2 diabetes study. All were deemed by the investigator to be not related to study drug.