The Top 14 side have reportedly become frustrated with Leicester's valuation of the player, but Cohen has insisted that the deal is still on.
"We met with Mourad Boudjellal and we agreed a fee at that meeting," Cohen told the Leicester Mercury.
"Toulon have been unable to complete the agreement but our position remains exactly the same. We have identified a replacement and, if Toulon are able to complete the agreement and the replacement player becomes available, we would still be able to release Castro.
"But at the point in time at which the replacement we have identified signs elsewhere, we will then not be in a position to release Castro. If he does end up staying at Tigers, we will be happy because he is a great player and an icon of the club."
The two sides will clash in the Heineken Cup quarter-finals this weekend.