AstraZeneca plc AZN and Eli Lilly and Company LLY announced that a phase II/III study (AMARANTH) on their BACE inhibitor, AZD3293, will continue into phase III of the phase II/III seamless study. AZD3293 is being evaluated for the treatment of patients suffering from early Alzheimer’s disease – the most common form of dementia. The decision comes following recommendation from an independent data monitoring committee after a scheduled interim safety analysis was conducted. The committee suggested that the study should continue without any change. However, the analysis was not intended to review efficacy. Following the latest development, AstraZeneca and Eli Lilly announced the commencement of a new phase III study on AZD3293 – DAYBREAK. The study will evaluate the safety and efficacy of AZD3293 in patients with mild Alzheimer’s dementia. Enrollment of patients will begin in the third quarter of 2016. The advancement of AZD3293 into phase III development will trigger a milestone payment of $100 million to AstraZeneca from Eli Lilly. In Sep 2014, AstraZeneca and Eli Lilly had announced an agreement for the development and commercialization of AZD3293. Per the deal, Eli Lilly will lead the development path and will work alongside researchers from AstraZeneca, who will undertake manufacturing responsibilities. Both companies will share development and commercialization costs and net global revenues equally post-launch. Moreover, AstraZeneca informed that the payment will be reported as Externalisation Revenue in the company’s financial statements and is not expected to impact the financial guidance for 2016. We are encouraged by the companies’ progress with their Alzheimer’s disease candidate. Per data provided by AstraZeneca in its press release, an estimated 46 million people are living with dementia across the world. Alzheimer’s disease accounts for 60% to 80% of dementia cases. So, this market offers huge commercial potential and a successfully developed product could bring in billions of dollars in sales. We note that several companies are looking to enter this space including Biogen Inc. BIIB. However, we note that the successful development of therapies for the treatment of Alzheimer’s disease is challenging with quite a few companies having faced significant setbacks. AstraZeneca is a Zacks Rank #3 (Hold) stock. Anika Therapeutics Inc. ANIK is a better-ranked stock in the health care sector carrying a Zacks Rank #1 (Strong Buy). Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report ASTRAZENECA PLC (AZN): Free Stock Analysis Report LILLY ELI & CO (LLY): Free Stock Analysis Report BIOGEN INC (BIIB): Free Stock Analysis Report ANIKA THERAPEUT (ANIK): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research