Corcept Therapeutics Incorporated (NASDAQ: CORT), a pharmaceutical
company engaged in the discovery, development and commercialization
of drugs for the treatment of severe metabolic and psychiatric
disorders, today reported its financial results for the quarter
ended June 30, 2013.
Second Quarter Financial Results
- Recognized GAAP net revenue of $1.9 million. During the quarter
we transitioned to a new specialty pharmacy and our prior specialty
pharmacy reduced its inventory of Korlym® tablets by (i) purchasing
fewer tablets than it dispensed in the quarter, which resulted in
$100,000 less revenue than if inventory levels had not changed and
(ii) returning the tablets it did not dispense, which reduced
revenue by an additional $300,000. Without these reductions, our
net revenue would have been $2.3 million on a non-GAAP basis.
- Recorded a GAAP net loss of $11.9 million, or $0.12 per share.
After adjusting for significant non-cash expenses, net loss on a
non-GAAP basis was $0.10 per share. A reconciliation of non-GAAP
net loss to GAAP net loss is included in this press release.
- As of June 30, 2013, we held cash and cash equivalents of $72.2
million.
Recent Operational Highlights
- Continued to enroll patients in our phase 3 study of the use of
mifepristone, Korlym's active ingredient, in the treatment of
psychotic depression. We expect to perform an interim analysis of
data from this study and report results of that analysis in the
third quarter of 2014.
- Transitioned our specialty pharmacy and patient services
provider to Centric Health Services, Inc., a company that focuses
on the needs of orphan drug companies and the patients they serve.
Centric became our sole provider of such services beginning July 1,
2013.
- Made Korlym available to patients in countries outside of the
United States through a named-patient program with IDIS Limited. A
named-patient program provides access to unapproved drugs in a
particular country. IDIS's rights are restricted to named-patient
programs and will terminate with respect to a particular country
upon Korlym's regulatory approval and commercial availability
there.
"In the second quarter, we made substantial progress toward our
goal of providing Korlym to every Cushing's syndrome patient who
might benefit from it," said Joseph K. Belanoff, M.D., Corcept's
Chief Executive Officer. "We believe our new specialty pharmacy
will provide patients with careful attention and quality service.
We're looking forward to working with IDIS to make Korlym available
on a named-patient basis worldwide."
Financial Results
For the second quarter of 2013, we recognized net product
revenue of $1.9 million after deducting a product return reserve of
$300,000 incurred in connection with the company's transition to a
new specialty pharmacy, as well as government rebates, chargebacks
and other allowances. Cost of sales for the second quarter of 2013
was $23,000. Because we expensed product manufacturing costs
incurred prior to FDA approval in February 2012, our cost of sales
in the second quarter of 2013 consisted primarily of stability
testing and distribution costs.
We reported a net loss of $11.9 million, or $0.12 per share, for
the second quarter of 2013, compared to a net loss of $7.6 million,
or $0.09 per share, for the same period in 2012.
The net loss for the second quarter of 2013 and the
corresponding period in 2012 included significant non-cash
stock-based compensation expenses of $1.3 million and $0.9 million,
respectively. In addition, we recorded non-cash accreted interest
expense related to our capped royalty financing transaction of $1.1
million in the second quarter of 2013. After adjusting for these
non-cash expenses, the company's net loss on a non-GAAP basis was
$9.5 million, or $0.10 per share, for the second quarter of 2013,
compared to $6.7 million, or $0.08 per share, for the same period
in 2012. A reconciliation of GAAP net loss to non-GAAP net loss is
included below.
Operating expenses for the second quarter of 2013 were $12.7
million, compared to $8.5 million for the second quarter of
2012.
- Selling, general and administrative expenses in the second
quarter of 2013 were $8.2 million, compared to $5.8 million for the
comparable period in 2012. The increase was primarily due to
increased staffing, consultancy, contracted sales force and other
professional services costs related to the commercialization of
Korlym.
- Research and development expenses in the second quarter of 2013
were $4.5 million, compared to $2.7 million for the comparable
period in 2012. The increase was primarily due to increased
clinical trials costs, staffing and consultancy to support the
expansion of our phase 3 trial of mifepristone for the treatment of
psychotic depression and the development of our next-generation
selective GR-II antagonists.
Our cash balance as of June 30, 2013 was $72.2 million, as
compared to $93.0 million at December 31, 2012, and reflects
approximately $20.8 million spent on operations during the first
half of 2013.
Conference Call
Corcept will hold a conference call on August 8, 2013, at 5:00
p.m. Eastern Time (2:00 p.m. Pacific Time) to discuss this
announcement. To participate, dial 1-888-771-4371 in the United
States or +1-847-585-4405 internationally approximately ten minutes
before the start of the call. The pass code is 35403018.
A replay of the call will be available through August 22, 2013
at 1-888-843-7419 from the United States and +1-630-652-3042
internationally. The pass code is 35403018.
About Cushing's Syndrome
Endogenous Cushing's syndrome is caused by prolonged exposure of
the body's tissues to high levels of the hormone cortisol and is
generated by tumors that produce cortisol or ACTH. Cushing's
syndrome is an orphan indication that most commonly affects adults
aged 20 to 50. An estimated 10-15 of every one million people are
newly diagnosed with this syndrome each year, resulting in over
3,000 new patients annually in the United States. An estimated
20,000 patients in the United States have Cushing's syndrome,
approximately half of whom are cured by surgery. Symptoms vary, but
most people have one or more of the following manifestations: high
blood sugar, diabetes, high blood pressure, upper body obesity,
rounded face, increased fat around the neck, thinning arms and
legs, severe fatigue and weak muscles. Irritability, anxiety,
cognitive disturbances and depression are also common. Cushing's
syndrome can affect every organ system in the body and can be
lethal if not treated effectively.
About Korlym®
Korlym competitively blocks the glucocorticoid receptor type II
(GR-II), one of the two receptors to which cortisol normally binds,
thereby inhibiting the effects of excess cortisol in Cushing's
syndrome patients. In April 2012, Corcept made Korlym available as
a once-daily oral treatment of hyperglycemia secondary to
endogenous Cushing's syndrome in adult patients with glucose
intolerance or diabetes mellitus type 2 who have failed surgery or
are not candidates for surgery. Korlym was the first FDA-approved
treatment for that illness and the FDA has designated it as an
Orphan Drug for that indication. Orphan Drug designation is a
special status designed to encourage the development of medicines
for rare diseases and conditions. Because Korlym is an Orphan Drug,
Corcept will have marketing exclusivity for the approved indication
in the United States until February 2019.
About Psychotic Depression
Psychotic depression is a serious psychiatric disorder that
affects approximately three million people annually in the United
States. It is more prevalent than either schizophrenia or bipolar I
disorder. The disorder is characterized by severe depression
accompanied by delusions, hallucinations or both. People with
psychotic depression are approximately 70 times more likely to
commit suicide than the general population and often require
lengthy and expensive hospital stays. There is no FDA-approved
treatment for psychotic depression.
About Corcept Therapeutics
Incorporated
Corcept is a pharmaceutical company engaged in the discovery,
development and commercialization of drugs for the treatment of
severe metabolic and psychiatric disorders. Korlym, a first
generation competitive GR-II antagonist, is the company's first
FDA-approved medication. The company has a phase 3 trial underway
for mifepristone for treatment of the psychotic features of
psychotic depression and a portfolio of selective GR-II antagonists
that competitively block the effects of cortisol but not
progesterone. It owns extensive intellectual property covering the
use of GR-II antagonists, including mifepristone, in the treatment
of a wide variety of metabolic, psychiatric and other disorders. It
also holds composition of matter patents for its selective GR-II
antagonists.
Non-GAAP Measures
To supplement Corcept's financial results presented on a GAAP
basis, we use non-GAAP measures of net loss that exclude
significant non-cash expenses related to stock-based compensation
expense and the accretion of interest expense under our capped
royalty financing transaction. We also use a non-GAAP measure of
net revenue that adds back to GAAP net revenue expenses associated
with our specialty pharmacy's elimination of its entire Korlym
inventory through reduced purchases from us and the return of
product it had not yet sold. We believe that these non-GAAP
measures of net revenue and net loss help investors better evaluate
the company's past financial performance and potential future
results. Non-GAAP measures should not be considered in isolation or
as a substitute for comparable GAAP accounting and investors should
read them in conjunction with the company's financial statements
prepared in accordance with GAAP. The non-GAAP measures of net
revenue and net loss we use may be different from, and not directly
comparable to, similarly titled measures used by other
companies.
"Safe Harbor" Statement under the Private
Securities Litigation Reform Act of 1995
Statements made in this news release, other than statements of
historical fact, are forward-looking statements. Forward-looking
statements are subject to a number of known and unknown risks and
uncertainties that might cause actual results to differ materially
from those expressed or implied by such statements. Forward-looking
statements include those regarding the pace of Korlym's acceptance
by physicians and patients, the pace of enrollment in or the
outcome of the company's phase 3 trial of mifepristone for the
treatment of psychotic depression, the effects of rapid
technological change and competition, the protections afforded by
Korlym's Orphan Drug Designation, by Corcept's patent portfolio, or
by the company's other intellectual property rights, or the cost,
pace and success of Corcept's product development efforts,
including its ability to advance its next-generation selective
GR-II antagonists towards human use. These and other risks are set
forth in the company's SEC filings, all of which are available from
the company's website (http://www.corcept.com) or from the SEC's website
(http://www.sec.gov). Corcept disclaims any
intention or duty to update any forward-looking statement made in
this news release.
CORCEPT THERAPEUTICS INCORPORATED
CONDENSED BALANCE SHEETS
(in thousands)
June 30, December 31,
2013 2012
------------- -------------
(Unaudited) (Note)
ASSETS:
Cash and cash equivalents $ 72,220 $ 93,032
Trade receivables, net 855 557
Inventory 5,544 4,663
Other assets 1,068 914
------------- -------------
Total assets $ 79,687 $ 99,166
============= =============
LIABILITIES AND STOCKHOLDERS' EQUITY:
Accounts payable $ 3,033 $ 3,804
Deferred revenue 37 16
Long-term obligation 33,887 31,680
Other liabilities 2,359 1,889
Stockholders' equity 40,371 61,777
------------- -------------
Total liabilities and stockholders' equity $ 79,687 $ 99,166
============= =============
Note: Derived from audited financial statements at that
date.
CORCEPT THERAPEUTICS INCORPORATED
CONDENSED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)
(Unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
-------------------- --------------------
2013 2012 2013 2012
--------- --------- --------- ---------
Revenues:
Product sales, net $ 1,891 $ 875 $ 3,608 $ 875
Operating expenses:
Cost of sales 23 48 43 48
Research and development 4,491 2,668 8,748 6,210
Selling, general and
administrative 8,160 5,751 16,544 13,238
--------- --------- --------- ---------
Total operating expenses 12,674 8,467 25,335 19,496
--------- --------- --------- ---------
Loss from operations (10,783) (7,592) (21,727) (18,621)
Interest and other expense (1,114) (5) (2,254) (9)
--------- --------- --------- ---------
Net loss and comprehensive
loss $ (11,897) $ (7,597) $ (23,981) $ (18,630)
========= ========= ========= =========
Basic and diluted net loss per
share $ (0.12) $ (0.09) $ (0.24) $ (0.22)
========= ========= ========= =========
Shares used in computing basic
and diluted net loss per share 99,814 88,621 99,814 86,521
========= ========= ========= =========
CORCEPT THERAPEUTICS INCORPORATED
RECONCILIATION OF GAAP TO NON-GAAP NET LOSS
(in thousands, except per share amounts)
(Unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
-------------------- --------------------
2013 2012 2013 2012
--------- --------- --------- ---------
GAAP net loss $ (11,897) $ (7,597) $ (23,981) $ (18,630)
Significant non-cash expenses:
Stock-based compensation
Research and development 157 138 305 256
Selling, general and
administrative 1,108 744 2,270 3,015
--------- --------- --------- ---------
Total stock-based
compensation 1,265 882 2,575 3,271
--------- --------- --------- ---------
Accretion of interest expense
related to long-term
obligation 1,092 -- 2,207 --
--------- --------- --------- ---------
Non-GAAP net loss $ (9,540) $ (6,715) $ (19,199) $ (15,359)
========= ========= ========= =========
GAAP basic and diluted net loss
per share $ (0.12) $ (0.09) $ (0.24) $ (0.22)
========= ========= ========= =========
Non-GAAP basic and diluted net
loss per share as adjusted for
significant non-cash expenses $ (0.10) $ (0.08) $ (0.19) $ (0.18)
========= ========= ========= =========
Shares used in computing basic
and diluted net loss per share 99,814 88,621 99,814 86,521
========= ========= ========= =========
CONTACT: Charles Robb Chief Financial Officer Corcept
Therapeutics 650-688-8783 Email Contact www.corcept.com
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