Corcept Therapeutics Incorporated (NASDAQ:CORT) Q4 2023 Earnings Call Transcript
Corcept Therapeutics Incorporated (NASDAQ:CORT) Q4 2023 Earnings Call Transcript February 15, 2024
Corcept Therapeutics Incorporated beats earnings expectations. Reported EPS is $0.28, expectations were $0.25. Corcept Therapeutics Incorporated isn’t one of the 30 most popular stocks among hedge funds at the end of the third quarter (see the details here).
Operator: Welcome to the Corcept Therapeutics Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised, today's conference is being recorded. I would like to turn the call over Atabak Mokari. Please go ahead.
Atabak Mokari: Hello, everyone. Good afternoon and thank you for joining us. Today, we issued a press release announcing our financial results for the fourth quarter and providing a corporate update. A copy is available at corcept.com. Our complete financial results will be available when we file our Form 10-Q with the SEC. Today's call is being recorded. A replay will be available at the Investors Past Events tab of our website. Statements during this call, other than statements of historical fact are forward-looking statements based on our plans and expectations that are subject to risks and uncertainties which may cause actual results to differ materially from those such statements expressed or implied. These forward-looking statements are described in today's press release and the risks and uncertainties that may affect them are described in the press release and in our annual report on Form 10-K or our quarterly reports on Form 10-Q.
Please refer to those documents for additional information. We disclaim any intention or duty to update forward-looking statements. Our revenue in the fourth quarter of 2023 was $135.4 million, an increase of 31% compared to the fourth quarter of the prior year. We expect our revenue growth to continue and are reiterating 2024 revenue guidance of $600 million to $630 million, compared to 2023 revenue of $482.4 million. Net income was $31.4 million in the fourth quarter and $106.1 million for the full year of 2023. Our cash and investments at December 31 was $425.4 million. I will now turn the call over to Charlie Robb, our Chief Business Officer, to provide a legal update. Charlie?
Charlie Robb: Thanks, Atabak. In March 2018, we sued Teva Pharmaceuticals to prevent it from marketing a generic version of Korlym in violation of our patents. The case went to trial in federal district court in September of last year. On December 29, the court found that Teva's generic product would not infringe the two patents we had asserted against it. We believe the court's verdict is wrong and is based on a misunderstanding of the law. Accordingly, we are seeking its reversal by the Federal Circuit Court of Appeals. It is impossible to predict exactly how long the appeal will take. Briefing will be complete no later than May. Our opening brief is due March 09. Teva will have up to 40 days after we file to respond. Our reply brief, closing the briefing cycle, will be due no later than 21 days after that.
These documents will all be publicly available on the internet at the PACER website. With briefing complete, the timing of oral argument and issuance of an opinion are entirely up to the court. Based on past practice, it's reasonable to expect oral argument in the fourth quarter of this year and a decision early in the first quarter of 2025. If we prevail, Teva would lose FDA approval of its product, at least until the expiration of our patents in 2037. We are eager to advance this appeal. As has always been the case, we strongly believe that our position is the correct one. We are confident that the Federal Circuit, with its deep expertise in this area of the law, will agree. I will now turn the call over to Joe Belanoff, our Chief Executive Officer.
Joe?
Joseph Belanoff: Thank you, Charlie. And thank you everyone for joining us this afternoon. Atabak highlighted our strong commercial performance and the revenue guidance we have set for 2024. A few weeks ago, I had the opportunity to meet with our endocrinology team at our National Field Meeting. The enthusiasm about our prospects in hypercortisolism was palpable. We have the opportunity to help many more patients with Cushing's syndrome. We are reaching a tipping point of sorts, with the medical field increasingly understanding that hypercortisolism is far more prevalent than was previously assumed. Our ongoing Phase 4 CATALYST study will reinforce this emerging understanding, and I believe this study will be a landmark in guiding the future screening and accurate diagnosis of patients with Cushing's syndrome.
Catalyst is the largest clinical trial ever conducted to examine the prevalence of hypercortisolism in patients with difficult-to-treat type 2 diabetes. Its investigators are unquestionably the country's top diabetologists. Today, we announced preliminary results from the first 700 patients enrolled. Those results showed a hypercortisolism prevalence rate of 24%, far higher than many in the medical community have believed to be the case in this population. This is a two-part study. The prevalence portion of catalyst continues to enrol patients. Those diagnosed with hypercortisolism can enrol in the treatment phase. The final results from the prevalence phase will be presented in a keynote session at the American Diabetes Association's Annual Meeting in June.
The results of the CATALYST study will undoubtedly stimulate physicians to screen patients for hypercortisolism, and many more than are currently identified will be found. Corcept is well-positioned to help them. For more than a decade, we have invested in patient advocacy and education and patient support services that are all based on understanding the journey and needs of an individual diagnosed with hypercortisolism. Our team is proud of these programs, and we are prepared to help what we know will be a growing number of patients in the years to come. As the awareness and diagnosis of Cushing's syndrome increases, we are working with a great sense of urgency to advance relacorilant. This sense of urgency comes from knowing that the compound has compelling efficacy without many of the significant side effects of Korlym.
All of our proprietary compounds, including relacorilant, modulate cortisol's effects by binding to the glucocorticoid receptor, a receptor which is activated when cortisol levels are high. They do not bind to the progesterone receptor and, therefore, don't cause some of Korlym 's most serious off-target effects. We are evaluating relacorilant for the treatment of hypercortisolism in two Phase 3 trials, GRACE and GRADIENT. We expect GRACE to serve as the basis for our NDA submission in Kuching syndrome and to build on relacorilant's positive Phase 2 efficacy and safety data. Patients experience meaningful improvements in hypertension and glucose control, as well as the other signs of symptoms of Cushing's syndrome in the Phase 2 study. Relacorilant did not cause progesterone-related side effects, including endometrial thickening or vaginal bleeding.
Relacorilant also did not cause drug-induced hypokalemia. Progesterone-related side effects and hypokalemia are leading causes of Korlym discontinuation. Relacorilant's Phase 2 trial results were published in frontiers in endocrinology in July 2021. Our second Phase 3 trial in hypercortisolism, GRADIENT, is studying relacorilant's effects in patients whose Cushing's syndrome is caused by an adrenal adenoma or adrenal hyperplasia. Patients with this etiology of Cushing syndrome often experience a less rapid decline, but their health outcomes are poor, including a significantly higher risk of premature death. While we do not expect our NDA and Cushing syndrome to depend on efficacy data from GRADIENT, we do expect the study to provide valuable information about the treatment of an etiology of Cushing syndrome that affects many patients.
It bears repeating that the first phase of our ongoing Phase 4 CATALYST study reinforces the findings from many smaller studies, indicating that hypercortisolism is far more prevalent than was previously assumed. The findings from CATALYST will be entirely relevant to relacorilant as it emerges. As I said, we are working with great urgency and we are on track to submit our relacorilant Cushing syndrome NDA in the second quarter. We are also studying relacorilant as a treatment for different types of cancer. Our most advanced oncology program is in platinum-resistant ovarian cancer, a lethal cancer with few useful treatment options. There is great enthusiasm among the investigators participating in our Phase 3 ROSELLA trial. Enrolment in the study will close shortly and data will be available by the end of this year.
The goal of ROSELLA is simply to replicate our positive Phase 2 ovarian cancer trial results. ROSELLA's study design closely tracks our Phase 2 study with a planned enrolment of 360 women. Women enrolled in the study are randomized one-to- one to receive either relacorilant plus nab-Paclitaxel or nab-Paclitaxel alone. The primary endpoint is progression-free survival with overall survival of key secondary endpoint. We are conducting the study in collaboration with leading clinicians from the Gynecological Oncology Group, GOG, in the United States and the European Network of Gynecological Oncology Trials, NGOT Group in Europe. In our successful controlled Phase 2 trial, Relacorilant produced meaningful benefit to many women. While these women's disease had progressed on two or more previous lines of treatment, including previous taxanes, Relacorilant appeared to resensitize their tumors to chemotherapy's beneficial effects.
Those who received relacorilant intermittently, the day before, the day of, and the day after they received nab-Paclitaxel exhibited statistically significant improvement in progression-free survival and duration of response compared to the group who received nab-Paclitaxel monotherapy. Women in the intermittent relacorilant group also lived longer than those in the comparator arm. 29% of the patients who took intermittent relacorilant were alive two years after study start, versus only 14% who took nab-Paclitaxel alone. The addition of relacorilant enhanced the effect of chemotherapy, likely by blunting cortisol's anti-apoptotic effect. Just as important, the women who received relacorilant plus nab-Paclitaxel, experienced no additional side effect burden compared to those who took nab-Paclitaxel alone.
The results from this study were published in the Journal of Clinical Oncology in June 2023 with an accompanying editorial. Results have been featured in podium presentations in the 2021 and 2022 European Society for Medical Oncology ESMO meetings and the 2022 American Society of Clinical Oncology, ASCO annual meeting. Leading gynaecological oncologists have told us that relacorilant's potential benefits, improved progression-free and overall survival without increased side effect burden, would constitute an important medical advance and that relacorilant plus nab-Paclitaxel has the potential to become a new standard of care in women with platinum-resistant ovarian cancer. A second mechanism by which cortisol modulation may prove useful is by blocking an important tumor growth pathway.
Cortisol stimulation is a major reason why patients with prostate cancer treated with the widely prescribed androgen receptor antagonist Enzalutamide eventually experience resurgent disease. Deprived of androgen stimulation, their tumor switched to cortisol activity to stimulate grip. Our hypothesis is that adding a cortisol modulator to androgen deprivation therapy will close this tumor escape route. Our collaborators at the University of Chicago are enrolling a randomized placebo-controlled Phase 2 trial of relacorilant plus Enzalutamide in patients with prostate cancer, before these patients have had an initial prostatectomy. A third cortisol modulation mechanism seeks to treat tumors by enhancing the body's immune response. Cortisol suppresses the immune system, which may blunt the effectiveness of cancer therapies intended to stimulate the immune system.
Our hypothesis is that adding a cortisol modulator to immunotherapies such as checkpoint inhibitors may enhance the effectiveness of these therapies. We are conducting a Phase 1b trial of relacorilant plus the PD-1 checkpoint inhibitor Pembrolizumab in patients with advanced adrenal cancer whose tumors produce excess cortisol. Pembrolizumab is rarely effective as monotherapy in treating this form of adrenal cancer. While each of our compounds being evaluated in clinical studies selectively modulates cortisol activity, they are not identical and they produce distinct clinical effects. Some cross the blood-brain barrier, others do not. Some perform best in models of solid tumors, others are more potent in models of metabolic disease. Some appear to be tissue-specific, others have more global effects.
These diverse qualities allow us to study a wide variety of disorders using the best matched compounds. One of these compounds, dazucorilant, has shown great promise in animal models of ALS, improving motor performance and reducing neuroinflammation and muscular atrophy. As you know, ALS is a devastating disease with a very poor prognosis and limited options to help slow its progression. Our DAZALS trial is a randomized double-blind placebo-controlled Phase 2 trial of dazucorilant in patients with ALS. The primary endpoint is based on the ALS functional rating scale. The speed of enrolment in DAZALS exceeded our expectations. Enrolment will close shortly with data available by the end of this year. Finally, I'll turn to our program in NASH, a serious liver disorder that afflicts millions of people in the United States.
Miricorilant has demonstrated compelling early evidence as a treatment for NASH. Our Phase 1b dose-finding study found that patients who received 100 milligrams of Miricorilant orally twice a week for 12 weeks experienced a 30% reduction in liver fat, with improvement in liver enzymes, markers of fibrosis and key metabolic and lipid measures, including Homa IR, serum triglycerides and LDL. Importantly, miricorilant was also very well tolerated with no apparent GI side effects. We look forward to building on these promising results in our MONARCH study, a randomized double-blind placebo-controlled Phase 2b trial, now actively enrolling patients with biopsy-confirmed NASH. The primary endpoint of the study is reduction of liver fat, with NASH resolution and fibrosis improvement as key secondary endpoints.
In conclusion, we are extremely optimistic about the future of Corcept. Our Cushing syndrome franchise is built on a solid foundation, a foundation that is supported by scientific, medical and commercial expertise that we have been strengthening and honing for over 20 years. Our strong commercial results reflect that physicians are more regularly screening for hypercortisolism and underscore our ability to support them as they manage this complex disease. We expect the findings from our CATALYST study to help physicians better identify and treat patients whose difficult-to-treat diabetes is caused by hypercortisolism, a population whose Cushing syndrome too frequently goes missed or undiagnosed. Relacorilant has demonstrated tremendous promise as a treatment for patients with Cushing Syndrome, and we are on track to submit our NDA in the second quarter.
Beyond Cushing Syndrome, our development programs are generating increasing evidence that cortisol modulation has the potential to treat a wide range of diseases. Ovarian cancer, prostate cancer, ALS, and NASH are current examples. We have a broad and active research portfolio of many proprietary selective cortisol modulators with potentially very different clinical attributes. We will continue to invest in understanding these attributes and their potential therapeutic applications, and we will advance the most promising compounds to the clinic. Over the course of this year, we expect data from our GRACE, GRADIENT and CATALYST studies in Cushing Syndrome, our pivotal RASELA trial in ovarian cancer, and our DASL study in ALS. This is an exciting time for Corcept.
I appreciate the efforts and dedication of our more than 350 employees who are working hard to achieve the ambitious goals we have set for ourselves. Before we take questions, I want to take a moment to introduce Roberto Vieira, who joined Corsept a few years ago. Roberto, as President of our oncology division, is responsible for the commercialization of relacorilant in platelet-resistant ovarian cancer and the expansion of our oncology footprint. You'll have an opportunity to hear more from him over the course of 2024. Operator, let's proceed now to questions.
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