Japan's Astellas Pharma has linked up with California’s CoMentis to develop Alzheimer's drugs in a deal that could be worth up to $760 million.

The agreement will see the two firms develop and commercialise products from CoMentis' beta-secretase inhibitor programme, notably its lead compound CTS-21166, which is in Phase I as a disease-modifying treatment for Alzheimer's disease. In cash terms, Astellas will pay the South San Francisco-based company $80 million upfront and make an equity investment of $20 million.

CoMentis could also receive up to $660 million in development milestones, and while Astellas will fund 100% of the pre-Phase III global development costs, expenses will be shared after that. CoMentis retains the right to co-promote in the USA, where profits will be shared, and will receive royalties on sales elsewhere.

CTS-21166 is the first of “several highly selective, potent and orally active beta-secretase inhibitors” said the firms, claiming that inhibition of the enzyme reduces amyloid beta production which could slow the progression of Alzheimer's. Hirofumi Onosaka, Astellas' senior corporate executive, said that CoMentis “is very sophisticated in small-molecule drug discovery and development in CNS”, which is “one of our prioritised therapeutic areas.” The US firm’s chief executive Scott Harkonen said that Astellas “has the expertise and commitment necessary” to bring these compounds on and his company is pleased that it is “retaining substantial economic participation in the commercialisation of beta-secretase inhibitors."

The deal with CoMentis is the latest example of Astellas’ desire to expand in the USA and comes just a few months after it snapped up cancer antibody specialist Agensys for $387 million last November.