On March 31, 2015 The Medical University of South Carolina (MUSC) and Aeterna Zentaris Inc. (NASDAQ: AEZS, TSX: AEZ) (the "Company") reported that the Company has agreed to transfer its discovery library of roughly 100,000 unique compounds to the South Carolina Center for Therapeutic Discovery & Development (SCCTDD) housed at MUSC, pursuant to a just-concluded material transfer agreement (Press release, AEterna Zentaris, MAR 31, 2015, View Source [SID:1234512461]). This agreement represents the beginning of a long-term relationship between the two entities that will result in the continued use of the library for the discovery of drug development candidates for Aeterna Zentaris in the areas of oncology, neurology, endocrinology and women’s health. SCCTDD may make the library available to all investigators in the MUSC system without restriction on its use and will own any therapeutic compounds discovered outside Aeterna Zentaris’ areas of therapeutic interest.

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"The ongoing research at MUSC is outstanding in basic, translational, and clinical sciences, focused on understanding disease processes. The transfer of this high quality collection of drug-like compounds will significantly increase our opportunities to find new medicines through sophisticated screening mechanisms," said Karen Lackey, MUSC Center for Drug Discovery director. "The SCCTDD’s mission is to discover and develop effective medicines in diseases that currently lack viable treatment options."

For a 10-year period beginning in 2018, SCCTDD has agreed to conduct screening and pre‑clinical activities with respect to the library with the goal of developing at least one drug candidate in the Company’s areas of therapeutic interest each year. Aeterna Zentaris receives the right of first refusal to license the drug candidates.

"This agreement with MUSC is another concrete step in our strategy of streamlining our internal drug discovery programs in order to focus our resources on our late-stage clinical programs, as well as on our commercial activities," said David Dodd, Aeterna Zentaris chairman, president and CEO. "This agreement will therefore make it possible to continue drug discovery activities without the costs and risks that they imply. More importantly, it is in line with our overall strategy of transitioning into a commercially operating specialty biopharmaceutical company. We look forward to working with the center and MUSC, with which we have already established a close collaboration for our ZoptEC Phase 3 trial in endometrial cancer."

Should Aeterna Zentaris decide to pursue a drug candidate submitted by SCCTDD, MUSC will license the compound candidate to the Company, and will receive a royalty on the net sales of all commercialized products developed from that drug compound. Conversely, if Aeterna Zentaris decides not to further develop the drug candidate submitted by SCCTDD, MUSC will pay the Company a royalty on net sales of all commercialized products developed from that drug candidate.