On November 5, 2015 Corcept Therapeutics Incorporated (NASDAQ: CORT), a pharmaceutical company engaged in the discovery, development and commercialization of drugs that treat severe metabolic, oncologic and psychiatric disorders by modulating the effects of cortisol, reported its financial results for the quarter ended September 30, 2015 and provided a corporate update (Press release, Corcept Therapeutics, NOV 5, 2015, http://www.corcept.com/news_events/view/pr_1446758532 [SID:1234508043]).

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Corcept recorded net revenue of $13.3 million in the third quarter of 2015, compared to $7.3 million for the same period in 2014, an increase of 82 percent. The company reiterated its 2015 revenue guidance of $49 – $53 million.

Corcept reported a net loss on a GAAP basis of $0.6 million for the third quarter of 2015, compared to a GAAP net loss of $6.0 million for the same period in 2014. Excluding non-cash expenses, Corcept generated non-GAAP net income in the third quarter of $1.6 million, compared to a non-GAAP net loss of $3.9 million in the third quarter of 2014. A reconciliation of GAAP to non-GAAP net operating results is set forth below.

At September 30, 2015, Corcept held cash and cash equivalents of $36.5 million, compared to $37.0 million at the end of the prior quarter. This change in cash reflects the repayment of $1.8 million in principal due under the company’s capped royalty financing agreement (Royalty Financing). The company entered into the Royalty Financing in 2012 to fund the commercialization of Korlym and expects to make its final payment in 2017.

Based on its current plans, the company expects to reach cash flow breakeven, including payments of principal due under the Royalty Financing, without needing to raise additional funds.

"Our Cushing’s syndrome franchise continues to grow as more physicians appreciate that using Korlym to modulate the effect of excess cortisol can greatly improve their patients’ health," said Joseph K. Belanoff, M.D., Corcept’s Chief Executive Officer. "As we have said before, our efficient cost structure and the revenue growth in our Cushing’s syndrome business allows us to build our clinical infrastructure, further develop Korlym and advance our next-generation compounds."

Korlym for the Treatment of Triple-Negative Breast Cancer (TNBC)

In December 2015, at the San Antonio Breast Cancer Symposium, Corcept will present preliminary efficacy results of its Phase 1/2 open-label trial of Korlym in combination with eribulin (Halaven) to treat patients with metastatic TNBC.

CORT125134 Phase 2 Trials

CORT125134 is the lead compound in Corcept’s portfolio of proprietary next-generation cortisol modulators. It was well-tolerated in its Phase 1 trial and showed that it shares Korlym’s ability to potently modulate activity at the glucocorticoid receptor (GR), the essential quality in treating Cushing’s syndrome. In addition, when administered with a chemotherapeutic agent, CORT125134 slows tumor growth significantly in mouse models of TNBC and castration-resistant prostate cancer. In vitro, it similarly slows the growth of ovarian cancer tumor cells; in vivo testing in mouse models of ovarian cancer is in progress.

In the first quarter of 2016, the company plans to begin two Phase 2 clinical trials with CORT125134. One trial will be for the treatment of patients with Cushing’s syndrome. The other will administer CORT125134 with a companion chemotherapeutic or hormonal agent to treat patients with a solid tumor cancer.

"It’s an exciting time to join Corcept," said Robert S. Fishman, M.D., Corcept’s Chief Medical Officer. "We are exploring extending Korlym’s label to cover oncologic indications, our lead next-generation cortisol modulator, CORT125134, is about to enter multiple Phase 2 trials and we’re advancing additional selective cortisol modulating compounds toward the clinic."

Financial Discussion

Corcept recorded a GAAP net loss of $0.6 million in the third quarter of 2015, compared to $6.0 million in the third quarter of 2014, including non-cash stock-based compensation and accreted interest expense generated from the Royalty Financing of $2.2 million and $2.1 million in the third quarter of 2015 and 2014, respectively. Excluding these non-cash items, Corcept generated net income on a non-GAAP basis of $1.6 million in the third quarter of 2015, compared to a non-GAAP net loss of $3.9 million in the third quarter of 2014.

Operating expenses for the third quarter were $13.2 million, compared to $12.4 million for the third quarter of 2014. The increase was primarily due to increased staffing costs and additional spending on the Phase 1/2 trial of Korlym for the treatment of TNBC and the development of next-generation cortisol modulators.

In the third quarter of 2015, Corcept made a payment of $2.5 million under the Royalty Financing, of which $0.7 million represented accreted interest and $1.8 million reduced outstanding principal. In the same period of 2014, Corcept paid $1.3 million, of which $0.9 million represented accreted interest and $0.4 million reduced outstanding principal. Corcept expects to make its final payment under the Royalty Financing in 2017.

Corcept’s cash balance at September 30, 2015 was $36.5 million, compared to $37.0 million at June 30, 2015 and $24.2 million at December 31, 2014.