Corcept's Loss Narrows in 4Q

Corcept Therapeutics Inc. (CORT - Snapshot Report) posted a loss per share of 11 cents in the fourth quarter of 2012 which was narrower than the loss of 12 cents posted in the year-ago quarter

Adjusted loss per share was 10 cents (including stock-based compensation but excluding accretion of interest expense related to long-term obligation) compared to an adjusted loss of 12 cents per share in the year-ago quarter. The Zacks Consensus Estimate was a loss of 9 cents per share.

Corcept generated revenues of $1.4 million in the fourth quarter of 2012, in line with the preliminary results provided on Feb 12, 2013 but missed the Zacks Consensus Estimate of $2.0 million.

In Apr 2012, Corcept began offering its first product, Korlym (mifepristone) 300 mg tablets after getting approval from the US Food and Drug Administration (FDA) in Feb 2012. Korlym, a potent glucocorticoid receptor II (GR-II) antagonist, is approved in the US as a once-daily oral medication for the treatment of hyperglycemia secondary to hypercortisolism in adults suffering from endogenous Cushing’s syndrome who have type II diabetes or glucose intolerance.

We note that Corcept enjoys orphan drug designations for Korlym from the FDA for the approved indication. Korlym was also approved by the European Commission for the treatment of endogenous Cushing’s syndrome in Oct 2011.

Selling, general and administrative expenses were $6.5 million in the final quarter of 2012, up 97.4% from the year-ago quarter. The phenomenal increase was due to higher staffing, consultancy and other professional services costs related to the commercialization of Korlym.

Research and development expenses in the fourth quarter were $4.9 million, down from 25.7% from the year-ago quarter. The decrease was mainly due to a reduction in manufacturing expenses as a result of capitalization of inventory following the FDA approval.

For 2012, Corcept reported revenues of $3.3 million beating the Zacks Consensus Estimate of $3 million. Loss per share was 41 cents per share, wider than the loss of 29 cents reported in 2011.

Adjusted loss per share was 39 cents, flat with 2011. The Zacks Consensus Estimate for 2012 is a loss of 38 cents per share.

Corcept currently has an ongoing phase III study of mifepristone, the active ingredient in Korlym, for the treatment of psychotic depression. Corcept also discovered three series of novel selective GR-II antagonists in 2012 and plans to develop it further in 2013 for human use.

Corcept currently carries a Zacks Rank #3 (Hold). Pharma stocks, which are currently well placed, include Shire (SHPG - Snapshot Report), Furiex Pharmaceuticals (FURX - Snapshot Report) and Avanir Pharmaceuticals Inc (AVNR - Snapshot Report) with a Zacks Rank #2 (Buy).