Targacept Inc. said today that it has received a $200 million upfront payment from AstraZeneca PLC regarding their partnership on a drug compound targeting major depressive disorder.
The companies said on Dec. 3 that they had signed a licensing agreement that could be worth up to $1.24 billion for Targacept.
The agreement covers Targacept's research breakthrough on treating depression with its TC-5214 drug compound. Targacept develops drugs based on its understanding of nicotinic receptors to treat diseases of the central nervous system.
The agreement consists of a three-tier package that starts with the cash payment. Targacept received the payment earlier than expected because of the early termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act.
AstraZeneca also has agreed to pay $540 million if specified development, regulatory and first commercial-sale milestones are achieved. Targacept is eligible for up to $500 million if specified sales-related milestones are reached, along with certain royalties reached on net sales worldwide.
Don deBethizy, the president and chief executive of Targacept, said that Targacept plans to use some of the $200 million to further develop "a pipeline that very few biotechnology companies have."
Targacept also has taken significant clinical steps with drug compounds for adult attention deficit hyperactivity disorder, Alzheimer's disease and cognitive dysfunction in schizophrenia.
Major depressive disorder affects about 42 million people worldwide. The global antidepressant market is valued at more than $20 billion.
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