Targacept Inc,. has announced that AstraZeneca plans to continue development of AZD3480 (TC-1734) in Alzheimer's disease and cognitive deficits in schizophrenia.

AstraZeneca's determination to continue development triggers a $20 million milestone payment to Targacept under the parties' collaboration agreement.

"AstraZeneca is committed to developing innovative therapies in the areas of unmet need of Alzheimer's disease, schizophrenia and other cognitive disorders. Our decision to continue clinical development of AZD3480 demonstrates our belief in the cognitive-enhancing potential of NNR-targeted therapeutics," said Bob Holland, vice president and head of the neuroscience therapy area, AstraZeneca. "In addition to the promise of AZD3480, we are very pleased with our research collaboration with Targacept. We entered into the collaboration excited about the prospects of combining Targacept's longstanding leadership position in NNR research with our existing strengths, and the progress made in a relatively short time has been impressive."

"We are delighted with AstraZeneca's plans to move forward with development of AZD3480 in these two areas where a significant medical need is clear. We believe that the effects on cognition that we observed in our previous nine clinical trials of this product candidate in approximately 400 subjects show its potential as a treatment for cognitive disorders," said J Donald deBethizy, PhD, president and CEO of Targacept. "We are very pleased that AstraZeneca made the determination to conduct further development of AZD3480 ahead of schedule, demonstrating a strong commitment to the NNR mechanism and an extraordinary ability to execute against aggressive timelines. We look forward to a long and productive collaboration."

Alzheimer's disease represents an area of great medical need in the developed and developing world, causing great distress to patients and their caregivers and imposing a major financial burden. Current treatments have limited efficacy and significant side effects in many patients.

Schizophrenia is a chronic, severe and disabling form of psychosis that, in addition to symptoms such as delusions and hallucinations, is often marked by impairments in cognitive functions such as attention, vigilance, memory and reasoning. These cognitive impairments play a primary role in the inability of schizophrenic patients to function normally. There is currently no product approved for the treatment of cognitive deficits in schizophrenia.