Cornerstone Therapeutics Licenses Alpha-7 Technology to Targacept
Potential Payments for a Lead Compound May Exceed $75 Million
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.
About Cornerstone Therapeutics
Cornerstone Therapeutics Inc. (Nasdaq: CRTX), headquartered in Cary, N.C., is a specialty pharmaceutical company focused on acquiring, developing and commercializing significant products primarily for the respiratory and related markets. The Company currently promotes multiple marketed products in the United States to respiratory-focused physicians, key retail pharmacies and hospitals with its specialty sales forces. The Company also has a late-stage clinical pipeline with a recent regulatory submission filing and four additional regulatory approval submissions targeted within the next three years. Key elements of the Company's strategy are to in-license or acquire rights to underpromoted, patent-protected, branded respiratory or related pharmaceutical products, or late-stage product candidates; implement life cycle management strategies to maximize the potential value and competitive position of the Company's currently marketed products, newly acquired products and product candidates that are currently in development; grow product revenue through the Company's specialty sales forces; and maintain and strengthen the intellectual property position of the Company's currently marketed products, newly acquired products and product candidates.
Safe Harbor Statement
This press release includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. For this purpose, any statements contained herein, other than statements of historical fact, including statements regarding the progress and timing of our licensing transactions, our product development programs and related trials, our strategy and our future operations and opportunities, constitute forward-looking statements. Actual results may differ materially from those indicated by such forward-looking statements as a result of various important factors, including the results of preclinical studies and clinical trials with respect to our products under development, our ability to enter into collaboration or other license arrangements with respect to our technology on commercially reasonable terms or at all, our ability to satisfy FDA and other regulatory requirements and the other factors described in Item 1A (Risk Factors) of our Annual Report on Form 10-K filed with the Securities and Exchange Commission (the SEC) on March 4, 2010 and in our subsequent filings with the SEC. In addition, the statements in this press release reflect our expectations and beliefs as of the date of this release, should not be relied upon as representing our views as of any other date and do not reflect the potential impact of any acquisitions, mergers, dispositions, business development transactions, joint ventures or investments that we may make or enter into. We anticipate that subsequent events and developments will cause our expectations and beliefs to change. However, while we may elect to update these forward-looking statements publicly at some point in the future, we specifically disclaim any obligation to do so, whether as a result of new information, future events or otherwise.