Targacept to Retain Full Rights for TC-5619

Targacept to Retain Full Rights for TC-5619

WINSTON-SALEM, N.C.--(BUSINESS WIRE)--Targacept, Inc. (NASDAQ: TRGT), a clinical-stage biopharmaceutical company developing novel NNR TherapeuticsTM, today announced that AstraZeneca will not exercise its option to license Targacept's product candidate TC-5619. As a result, Targacept retains full rights to the compound, a highly selective alpha7 neuronal nicotinic receptor modulator.

This outcome presents an opportunity to balance our portfolio between partnered and wholly owned assets and build additional value for Targacept. Our clinical results indicate the unique potential of TC-5619 to treat negative and cognitive symptoms of schizophrenia, a critical need not met by currently available treatments, and we are unwavering in our enthusiasm for the compound. We look forward to announcing our development plans soon," said J. Donald deBethizy, Ph.D., Targacept's President and Chief Executive Officer. "Notwithstanding this decision, AstraZeneca has been and remains a valued collaborator of ours in the development of NNR Therapeutics."

"While we have made the difficult decision to decline our right to license TC-5619, we nevertheless look forward to continuing our longstanding and productive relationship with Targacept," said Christer Köhler, Vice President and Head of the Innovative Medicines Unit for Central Nervous System and Pain at AstraZeneca.

Targacept recently completed two Phase 2 clinical trials of TC-5619, one in patients with schizophrenia and one in adults with attention deficit/hyperactivity disorder. The company is currently conducting additional clinical and non-clinical studies to enable potential additional Phase 2 development in Alzheimer's disease.

Company Presentation Today

As previously announced, J. Donald deBethizy, Ph.D., Targacept's President and Chief Executive Officer, is scheduled to present at 2:50 p.m. Eastern Time today at The Deutsche Bank Securities 36th Annual Health Care Conference at the InterContinental in Boston. Dr. deBethizy's presentation will be webcast and accessible from the Investor Relations page of Targacept's website, www.targacept.com. To ensure a timely connection to the webcast, it is recommended that users register at least 15 minutes prior to the scheduled start time. An archived version of the webcast will be available for replay on the Investor Calendar section of the Investor Relations page of Targacept's website for at least two weeks following the event.

About Targacept

Targacept is developing a diverse pipeline of innovative NNR TherapeuticsTM for difficult-to-treat diseases and disorders of the nervous system. NNR Therapeutics selectively modulate the activity of specific neuronal nicotinic receptors, a unique class of proteins that regulate vital biological functions that are impaired in various disease states. Targacept's lead program, TC-5214, is being co-developed with AstraZeneca and is in Phase 3 clinical studies as an adjunct treatment for major depressive disorder. Targacept leverages its scientific leadership and proprietary drug discovery platform PentadTM to generate novel small molecule product candidates to fuel its pipeline and attract significant collaborations with global pharmaceutical companies. For more information, please visit www.targacept.com.

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Forward-Looking Statements

This press release includes "forward-looking statements" made under the provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements other than statements of historical fact regarding, without limitation: the progress or scope of development of TC-5619, such as the target indication(s) for development; the medical benefits that may be derived from TC-5619; the competitive position of TC-5619 or the commercial opportunity in any target indication; Targacept's collaborations with AstraZeneca; or Targacept's plans, expectations or future operations, financial position, revenues, costs or expenses. Actual results, performance or experience may differ materially from those expressed or implied by any forward-looking statement as a result of various important factors, including without limitation risks and uncertainties relating to: the conduct and results of clinical trials and non-clinical studies and assessments of TC-5619, including the performance of third parties engaged to execute such trials, studies and assessments, delays resulting from any changes to the applicable protocols and difficulties or delays in the completion of subject enrollment or data analysis; whether the positive findings from Targacept's completed Phase 2 trial of TC-5619 in schizophrenia patients will be replicated in any future clinical trials of TC-5619 that may be conducted; and whether FDA or foreign regulatory authorities will determine the design and endpoints of any future clinical trials of TC-5619 in cognitive dysfunction in schizophrenia or residual phase schizophrenia to be sufficient to support approval for such indication. These and other risks and uncertainties are described in greater detail under the heading "Risk Factors" in Targacept's most recent Annual Report on Form 10-K and in other filings that it makes with the Securities and Exchange Commission. As a result of the risks and uncertainties, the results or events indicated by the forward-looking statements may not occur. Targacept cautions you not to place undue reliance on any forward-looking statement.

In addition, any forward-looking statement in this press release represents Targacept's views only as of the date of this press release and should not be relied upon as representing its views as of any subsequent date. Targacept disclaims any obligation to update any forward-looking statement, except as required by applicable law.

NNR TherapeuticsTM, PentadTM and Building Health, Restoring IndependenceSM are trademarks or service marks of Targacept, Inc. Any other service marks, trademarks and trade names appearing in this press release are the properties of their respective owners.