This conference call transcript was computer generated and almost certianly contains errors. This transcript is provided for information purposes only.EarningsCall, LLC makes no representation about the accuracy of the aforementioned transcript, and you are cautioned not to place undue reliance on the information provided by the transcript.
spk01: Good afternoon, ladies and gentlemen, and welcome to CORSEP Therapeutics Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session. If you would like to ask a question, you may press star, then the number 1 on your touchtone telephone. And if anyone should require assistance during the conference, please press star 0. Thank you. I would now like to turn the conference over to your host today, Mr. Adibak Mukari, Chief Financial Officer. Sir, the floor is yours.
spk02: Thank you. Good afternoon, and thank you for joining us. I'm Adhavak Mukhari, Corset's Chief Financial Officer. Today, we issued a press release announcing our financial results for the third quarter and providing a corporate update. The copy is available at Corset.com. Our complete financial results will be available when we file our form 10Q with the SEC. Today's call is being recorded. A replay will be available of the investor's 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 that statements express or imply. These risks and uncertainties include, but are not limited to, our ability to operate our business and achieve our goals and conduct our clinical trials during the COVID-19 pandemic and to generate sufficient revenues to fund our commercial operations and development program. the availability of competing treatments, including generic versions of Quorum, our ability to obtain acceptable prices or adequate insurance coverage and reimbursement for Quorum, risks related to the development of our product candidates, including their clinical attributes, regulatory approvals, mandates, and other requirements, and the scope and protective power of our intellectual property. These and other risks are set forth in our SEC filings, which are available at our website and the SEC's website. On this call, forward-looking statements include those concerning the safety, efficacy, and other clinical and commercial attributes of relacoralin, hexacoralin, miracoralin, CORIC-113-176, and our other selective cortisol modulators for the treatment of patients with solid tumors, liver disease, hypercortisone, antipsychotic-induced weight gain, amyotrophic lateral sclerosis, or ALS, and other disorders. the progress, enrollment, timing, design, and results of our clinical trials, our revenue guidance, cash flow, and expected growth, the impact of the COVID-19 pandemic on our commercial operations, financial performance, clinical development programs, as well as on physicians, payers, and patients, and on our anticipated financial performance and clinical development activities after the COVID-19 pandemic is controlled. The timing, cost, and outcome of litigation, including our lawsuits against Teva and Hikma Pharmaceuticals, have its appeal of its defeat in the Post-Grant Review, or PGR, before the Patent and Trial and Appeals Board, or PTAB, and may include other forward-looking statements during the course of the call. We disclaim any intention or duty to update forward-looking statements. Our revenue in the third quarter of 2021 was $96.1 million compared to $86.3 million in the third quarter of 2020, an increase of 11%. Third quarter 2021 GAAP net income was $30.5 million compared to $21.6 million in the same period last year. Non-GAAP net income, which excludes non-cash expenses related to stock-based compensation and the utilization of deferred tax assets together with related income tax effects, was $37 million in the third quarter compared to $30 million in the same period last year. We have tightened our 2021 revenue guidance of $365 to $375 million compared to previous guidance of $355 to $385 million. Our cash and investments totaled $495.2 million on September 30th, an increase of $23.6 million from June 30th. The balance of September 30th reflects the repurchase of $28 million per common stock in the third quarter. 1.2 million shares pursuant to our share repurchase program, and about 200,000 shares in connection with the net exercise of employees.com. Over the term of the share repurchase program, we purchased 4.3 million shares of our common stock at a cost of $98.2 million. And now, Charlie Roth, our Chief Business Officer, will provide a legal effort.
spk08: Charlie? Thanks, Adam Ackham. In March 2018, we sued Teva and Federal District Court to prevent it from marketing a generic version of Coralim in violation of our patents. The trial was originally scheduled to start in February of this year, although that date was vacated by the court. A new trial date has not been set. In April, the court granted us permission to file for summary judgment regarding Teva's infringement of our 214 patent. Teva responded by filing its own summary judgment motion with respect to the same patent. Summary judgment is a procedure whereby courts can decide a case without holding a trial. We believe the court has all it needs with respect to the 214 patent to decide the case in our favor. Having lost its action before the PTAB, which I will talk about more in a minute, TEVA can no longer challenge the 214 patent's validity in the district court case. TEVA can only argue that its proposed product would not infringe a position we believe has no legal or factual support. If the court grants our motion, we will have won the case. TEVA would be banned from marketing generic corlum until 2037, when the 214 patent expires. If the court rules in TEVA's favor, we will proceed trial sometime next year. There is at present no timetable for the court summary judgment ruling, no trial date, and no schedule for any trial-related activities. In parallel with the district court action, TEVA petitioned Federal Circuit Court of Appeals to reverse its PTAB loss, which I referred to earlier. The request, we believe, has no merit. Briefing is complete and the court heard oral argument on October 5th. We expect a decision in the next quarter or two. On March 12th, we sued another antifiler, Hikma Pharmaceuticals, in the same federal district court that is adjudicating our case against Teva. In the Hikma case, the court has set a fact discovery deadline of July 1st, 2022, next year. Nothing is scheduled after that. With respect to both Teva and Hikma, we are confident in the strength of our legal position. I'll now turn the call over to Dr. Joseph Belanoff, our Chief Executive Officer. Joe?
spk07: Thank you, Charlie. The strong growth of our commercial business in the third quarter reflects the continued easing of COVID-related public health restrictions. This has enabled physicians to see their patients more frequently, improving their ability to diagnose and treat patients with Cushing syndrome. The business translation of more patients benefiting from corallum treatment is a new record high in our quarterly revenue. We expect our growth to continue as pandemic conditions recede. Leading endocrinologists increasingly believe that there are substantially more patients with Cushing syndrome than was once assumed. For many of these patients, Quorum is an excellent treatment. We remain very optimistic about the future of our Cushing Syndrome business because it is built on a strong foundation, an effective, life-saving medication promoted by a dedicated commercial team that puts the interests of patients first. Our clinical development programs are another cause for optimism. We have created a library of more than 1,000 proprietary cortisol modulators, many of which are attractive candidates for development Like corallum, these compounds bind strongly to the glucocorticoid receptor, or GR. Unlike corallum, they have no affinity for the progesterone receptor and so don't cause some of corallum's most serious off-target effects. Beyond sharing the qualities of strong cortisol modulation and not perturbing the progesterone receptor, preclinical and clinical testing have shown that our molecules behave differently from one another in important ways. 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, while others have more global effects. These diverse qualities have allowed us to initiate clinical trials in a wide variety of disorders, including ovarian, adrenal, and prostate cancer, antipsychotic-induced weight gain, non-alcoholic steatohepatitis, or NASH, and, of course, Cushing syndrome. We are also planning to start a Phase II trial in patients with ALS in the first quarter of next year and have additional compounds in Phase I and preclinical development. Corlum's commercial success has provided the funds to advance all of these programs. Before I provide an update on our development programs, I'd like to introduce you to Bill Geyer, who recently joined us to lead our clinical development activities. Bill experienced tremendous success over his 20-year career at Gilead, and we have already benefited from his expertise and leadership. Bill joins us on this call and will be available during the Q&A session. Our oncology program is testing three anti-cancer mechanisms, first postulated by investigators at the University of Chicago and confirmed by other prominent researchers. One mechanism is increasing apoptosis. Apoptosis is the programmed cell death. that chemotherapy is meant to induce. Cortisol suppresses apoptosis. In our successful trial in women with advanced ovarian cancer, addition of the selective cortisol modulator reliquarylate enhanced the effect of chemotherapy, likely by blunting cortisol's anti-apoptotic effect. The results presented at the recent European Society for Medical Oncology, ESMO, Congress, clearly demonstrate the benefit experienced by the women who received reliquaryland, delayed disease progression without increased side effect burden. As a reminder, our Phase II trial is a controlled multicenter study of 178 women with platinum-resistant ovarian cancer who were randomized to one of three treatment arms. 60 women received a higher dose of relacoralin on the day before, the day of, and the day after they received nabpaclitaxel. We call this the intermittent arm. 58 women received a lower daily relacoralin dose in combination with nabpaclitaxel. We call this the continuous arm. And 60 women received nabpaclitaxel alone, the comparator arm. The trial's primary endpoint was progression-free survival, or PFS. The women who participated in our study were very ill, including platinum refractory patients. All had experienced disease progression despite prior lines of therapy. The median number of prior treatments was three. It is clear that relacoralin provided benefit to many of these women. Those who received relacoralin intermittently exhibited a statistically significant improvement in PFS compared to the group that received napaclitaxel monotherapy. Their hazard ratio was 0.66 with a p-value of 0.038. Their median PFS was 5.6 months, 1.8 months longer than the NAP paclitaxel monotherapy groups, which is 3.8 months. The women in the intermittent arm also experienced a statistically significant improvement in their duration of response relative to those in the comparator arm, 5.6 months versus 3.7 months. with a hazard ratio of 0.36 and a p-value of 0.006. While the overall survival, or OS, data collection had accumulated only 63% of the target 120 events at the time of the database cutoff, the women in the intermittent arm experienced a median OS of 12.9 months compared to 10.4 months in the comparator arm. Safety and tolerability in the two groups were comparable, We expect that the primary analysis of the OS data for this study will be available in the first quarter of next year. Based on these statistically significant and clinically meaningful results, we have received extremely positive feedback from leading gynecological oncologists regarding the promise of relacoralin as a potential treatment for women with this dire disease. Their premise is simple and powerful. Delayed disease progression increased side effect burden is an important medical advance. We are planning to meet with the FDA in the coming months to discuss the optimal path forward. 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 metastatic prostate cancer treated with the widely prescribed androgen receptor antagonist enzalutamide eventually experience resurgent disease. Deprived of androgen stimulation, their tumors switch to cortisol activity to stimulate growth. Our hypothesis is that adding a cortisol modulator to androgen deprivation therapy will close this tumor escape route. We are conducting a dose-finding study of our selective cortisol modulator, exocoralin, combined with enzalutamide in men with castration-resistant prostate cancer. and expect to select an optimum dose by the end of this year. A third oncologic mechanism recognizes cortisol suppression of the immune system, a quality that likely blunts the effectiveness of immunotherapy. We are conducting an open-label Phase 1B trial of relucoralin plus the PD-1 checkpoint inhibitor, Pembrolizumab, Merck's drug Keytruda, in patients with advanced adrenal cancer, whose tumors produce excess cortisol. These patients suffer the effects of adrenal cancer and Cushing syndrome, a usually quickly lethal combination. Pembrolizumab is rarely effective as monotherapy in these patients. We believe that these patients' cortisol excess may be countering the intended effects of pembrolizumab, which is to stimulate the immune therapy. So just let me say that a little bit more briefly. Cortisol suppresses the immune system immunotherapy increases the activity of the immune system, and by dialing back cortisol activity, we think that immunotherapy may become significantly more effective. Our trial is evaluating whether reliquorolin can treat these patients' Cushing syndrome by reducing cortisol activity and by reversing cortisol-induced immune suppression, allow pebrolizumab to achieve its full cancer-killing effect. We plan to enroll 20 patients at five sites in the United States. The primary endpoint is objective response rate, with secondary endpoints including progression-free survival, duration of response, and overall survival. I will now turn to our programs in metabolic disease and the recent findings of our proprietary selective cortisol modulator, Murocorrelant, in patients with NASH, a serious liver disorder. Patients who received miroquoralin in our phase two trial exhibited large rapid reductions in liver fat, but also substantial transient elevations of the liver enzymes ALT and AST. The improvement in liver fat in these patients was greater and occurred much more quickly than we had expected and are rarely seen over any period of treatment. As a reminder, the trial's primary endpoint 30% reduction in liver fat after 12 weeks of treatment. In fact, patients exhibited reductions in liver fat ranging from 38.5% to 73.8% after receiving miracloralin for just one month. It may be that the rapidity of miracloralin's fat-reducing effect caused ALT and AST to rise. One way the liver sheds its lipids is by metabolizing them into fatty acids. which in excessive amounts irritate the liver. Interestingly, levels of serum lipids in these patients did not increase with treatment, providing support for the idea that urethral leads to the excess fat in the liver being rapidly metabolized immediately within the liver. We will present these results at the American Association for the Study of Liver Disease, AASLD, meeting later this month. The presentation is now available in the publications section of our website. Our recently initiated Phase 1B dose-finding trial in patients with presumed NASH will evaluate if miracoralin can produce significant reductions in liver fat without causing liver irritation. We are also evaluating miracoralin as a potential treatment for patients with another serious and widespread disorder, antipsychotic-induced weight gain, In the United States, 6 million people take antipsychotic medications such as Lanzapine and Risperidone to treat illnesses including schizophrenia, bipolar disorder, and depression. While these drugs are very effective, they exact a steep price in the form of rapid and sustained weight gain, which leads to cardiovascular and metabolic disease. The average life expectancy of patients in the United States chronically take antipsychotic medication is decreased by 20 years, frequently due to increased cardiovascular events such as heart attacks and strokes. We are conducting two double-blind, placebo-controlled, Bayes II trials of Miracoralant in patients with this disorder, Gratitude and Gratitude II. These trials seek to build on the positive data from our study of Miracoralant in healthy subjects. Last year, we completed a trial in which 96 healthy subjects received olanzapine and either 600 milligrams of miracoralant, 900 milligrams of miracoralant, or placebo for 14 days. Subjects who received miracoralant gained significantly less weight than those who received placebo. They also exhibited a smaller increase in triglycerides and an ALT and AST, which typically exhibit sharp transient increases at the start of olanzapine therapy. A paper describing these results was recently published in the Journal of Clinical Psychopharmacology. The GRATITUDE trial is evaluating whether miracoralin can reverse recent antipsychotic-induced weight gain. 100 patients with schizophrenia or bipolar disorder will receive, in addition to their established dose of antipsychotic medication, either 600 milligrams of miracoralin or placebo for 12 weeks. GRATITUDE is being conducted at 30 centers in the United States. Our Gratitude 2 study is testing miracoralant as a treatment for long-standing antipsychotic-induced weight gain. 150 patients with schizophrenia will receive, in addition to their established dose of antipsychotic medication, either 600 milligrams or 900 milligrams of miracoralant or placebo for 26 weeks. Gratitude 2 is being conducted at 35 centers in the United States. The primary endpoint in both studies is reduction in body weight. Other important measures of metabolic activity will also be examined. We expect to complete enrollment in Gratitude II by the end of this year and in Gratitude in mid-2022. As many of you know, relacoralin is our planned successor to corallum for the treatment of hypercorazolism. We are evaluating it in two Phase III trials, GRACE and GRADIENT. Like all of our proprietary molecules, relacoralin is a selective cortisol modulator. Like coralin, it achieves its effect by competing with cortisol at the glucocorticoid receptor. Unlike coralin, it does not bind to the progesterone receptor, PR for short. It is not the abortion pill, and it does not cause other PR-related side effects, including endometrial thickening and vaginal bleeding. By a different mechanism, relacoralin also does not appear to cause hypokalemia, low potassium, a serious side effect experienced by 44% of patients in corallum's pivotal trial. Corallum-induced hypokalemia is a leading cause of corallum discontinuation. Relacoralin's Phase II efficacy and safety data were strong. Patients experienced meaningful improvements in hypertension and glucose control, as well as in a variety of other signs and symptoms of Cushing syndrome. There were no relic-correlant-induced incidents of endometrial thickening or vaginal bleeding, and no drug-induced hypokalemia. The trial results were recently published in Frontiers in Endocrinology. Our GRACE trial has a planned enrollment of 130 patients with any etiology of Cushing syndrome. As a reminder, GRACE has a randomized withdrawal trial design. All patients receive relacoralin for 22 weeks in an open-label phase. Those who meet response criteria for improvement in glucose control, hypertension, or both are randomized to continue treatment with relacoralin or placebo for 12 weeks. While the pandemic has and continues to impact the execution of this trial, we and our investigators are eager to take GRACE to the finish line. We expect GRACE to serve as the basis for our NDA submission in Cushing syndrome, which we remain on track to submit in the second quarter of 2023. Our second phase three trial, Gradient, is studying relic-correlance effects in patients whose Cushing syndrome is caused by an adrenal adenoma or adrenal hyperplasia. Patients with this etiology of Cushing syndrome often experience a less rapid decline, but ultimately their health outcomes are poor. Gradient has a planned enrollment of 130 patients and is being conducted at many of the sites participating in GRACE. Gradient is the first controlled study in patients with this type of Cushing syndrome. While we do not expect our NDA and Cushing syndrome to depend on data from Gradient, we do expect that its findings will help improve the care of these increasingly recognized patients. Finally, a brief word about Court 113-176, which has shown promise in animal models of ALS. We are in discussions with leading clinicians and the FDA regarding our development plans and plan to initiate a phase two trial by early next year. While the pandemic dampened our commercial results for more than a year, our business is growing as pandemic conditions improve. And remember, even in the most challenging periods of the pandemic, our commercial business generated more than enough cash to fund our advancing development activities. We believe cortisol modulation can help treat many serious disorders. Coraline for Patients with Cushing Syndrome is one example of cortisol modulation's benefit. The data generated by our ovarian cancer, NASH, and antipsychotic-induced weight gain programs provide increasing proof of cortisol modulation's broad worth. Currently, our oncology program is evaluating two of our proprietary cortisol modulators in three tumor types, ovarian, prostate, and adrenal. Our metabolic program is following up encouraging clinical data in NASH and antipsychotic induced weight gain. We continue to enroll patients in our phase three trials of relacoralin and Cushing syndrome. Early next year, we plan to start a phase two trial using another of our proprietary compounds, Cort113176, to treat patients with ALS, and more proprietary early-stage compounds advanced towards the clinic. This is an exciting time at CoreSep, and I'd like to thank our employees for their tremendous effort and dedication. In the coming months, we plan to expand our teams to support what we believe as an increasingly broad and strong pipeline. I'll stop here for questions.
spk01: Thank you, speakers. Ladies and gentlemen, as a reminder, if you have a question at this time, please press star, then the number one key on your touchtone telephone. Once again, you may press star one to ask a question. Please stand by while we compile the Q&A roster. Your first question is from Chris Howerton of Jefferies. Your line is open.
spk06: Excellent. Thank you very much for taking the questions. And I would agree, a lot going on, Joe, and an exciting time for the company. So for me, thank you. And two questions, I suppose, for me. One would be, you know, as you're kind of seeing, you know, the haze from the pandemic clearing and obviously the acceleration, as you indicated, are What do you think are going to be the key drivers for the commercial business in Cushing's next year? Any thoughts on things like sales projection, guidance, or what the key drivers are that you guys are looking forward to from a commercial perspective next year? The second question that I would have is that how do you anticipate the overall survival data from the ovarian cancer cohort? I think it's from the phase two. How will that impact the ultimate design? And do you believe there's still any opportunity for an accelerated approval using an alternative endpoint outside of OS? Thank you.
spk07: Thanks, Chris. I think we got both of those questions. And To save my voice a little bit, I'm going to pass you over to the eminent head of our commercial group, our chief commercial officer, Sean Maduke, to answer the first question.
spk11: Hey, Chris. Thanks for the questions. In terms of 2022, we expect that growth will continue. We do not provide guidance at this time, and we'll provide guidance early next year for our 22 numbers. You know, in terms of what the drivers of growth will be, you know, stepping back a little bit, Joe talked about the pandemic sort of lifting. And what we know is that physician visits matter, right, for both patients and our clinical specialists. And during the pandemic, those all went to zero. At the beginning of this year and sort of increasingly throughout the year, as restrictions of ease, things have opened up and patients have gone back to see their physicians. And we've been able to actually interact with physicians. And as a result, we see more being prescribed coralline. So things have started to return to normal, and we're optimistic that that improvement is going to continue. But I just want to state we're not there yet. We're partway there, we're not there yet. The reality is that some things may never return to how they were pre-pandemic. So in terms of next year, one thing we've done very diligently, methodically over time, is look at sort of our sales force and potentially increasing the size if we believe there's opportunity to get to more positions. And, you know, we started with 15 at launch. We're at 50 today, and we're planning to get to around 60 by next year. And just to be clear, you know, it takes time to find the right territory. That makes sense. It takes time to find the right talent. And then it takes time to get that clinical specialist trained up to a place where they can be effective in the field. So, you know, I wouldn't expect, you know, the extra 10 heads to start providing value early next year, but throughout the year, we'd expect to see some wrap-up from that. So, I mean, really, we're continuing to explore ways that we can continue to educate on disease education and on corallum and reach as many physicians as we possibly can. And just to sum it up, I mean, we have more prescribing physicians than we've ever had, and we've got more patients on So we expect to continue that trend into next year.
spk07: And I'd like to now introduce all of you to Bill Geyer. Bill is our chief development officer, recently from a long and successful career at Gilead. And I'd like to have him answer the question, your second question, Chris, related to our ovarian cancer study.
spk03: Great. Thank you. Thank you, Joe. And thank you for that question. So while your question was around OS, I do want to kind of bring you back to the beginning of the trial. With our phase two study, we met our primary endpoints. And we're very excited that we met our primary endpoint because we saw statistical significant improvements in progression-free survival and duration of response by approximately two months. And the good thing is, for that phase two study, you know, we saw overall results that were very strong, and we didn't have to look at subgroups to see a response for relacorlin plus nabpaclitaxel. So I think that's a very positive piece. And, you know, after the Presentation that Joe mentioned at ESMO, we've had many conversations with gynecological experts around the world, and they're just as excited with those primary results from our phase two study. Based upon those results, you know, we are actively planning with meeting with the FDA, and we'll talk about the most relevant information to come away with an optimal design for our path forward. When it comes to OS, we're evaluating OS. And at the time where we did the first data cut, we had 63% of OS events. And at that time, we saw a trend towards an improvement of OS about two and a half months. And I think that's also very positive. But yet, the good thing is that women are living longer in this trial. And that's the ultimate goal of hopefully what we can achieve with Relicoilib plus NatPak with Haxel. We will report the next analysis when we hit that final data cut of 120 events. We are actively planning for a phase three study and we plan to move forward and we're working with a leading organization called GOG, which is the gynecological oncology group. And as we've worked with them, they're very excited about the results as well and are actively working with us to help guide us for a path forward related to our phase three study or any other path forwards with the FDA.
spk07: Thank you, Bill. And, Chris, you know, I know sort of the import of your question. And, look, I think everyone should get, I'll say before I sit here to previous calls, that your expectation should be a Phase III study. It's certainly our expectation. We're setting up to do that. But data will come along over the next few months, and we will have conversations with the FDA and go from there. Of course, I'll alert you as soon as things are settled after that.
spk06: Okay. All right. Well, um, nice to meet you, Bill. And thanks a lot for answering the questions.
spk07: Thanks, Chris.
spk01: Your next question is from Matt Kaplan of Lattenberg. Your line is open.
spk05: Hi, uh, thanks for taking the questions and congrats on the strong quarterly results. Um, just wanted to, I guess, in your development programs, you mentioned ALS and, uh, your plans for 113, 176. Can you give us a little bit of detail in terms of the mechanism of action and why you think, quote, this molecule could play a role in ALS?
spk07: Yeah. Matt, let me take that question because, again, to provide a little bit of context, one of the things that really from the beginning of CORE-CEP that we did a little bit differently than other pharmaceutical companies is is we have always had extensive academic collaborations really throughout the world, half in the United States, half outside of the United States, half preclinical, half clinical. And frankly, it was the only way I thought we could get to the really broad platform of cortisol modulation. And just before I answer your question about ALS, everyone should understand that the Initial data for the oncology programs that we have came out of a long-term collaboration with the University of Chicago. The programs that we have in metabolic disease, particularly in NASH, came out of a long-term collaboration that we had with the University of Leiden in the Netherlands. And what it really provided for us was a great farm system. Not all research works out, but when it does work out, we're able to move it back in-house and make it go much more quickly. And one of our collaborating researchers is actually in Buenos Aires, in Argentina, a long-term ALS investigator. And fortunately, as I know you know, Matt, there really hasn't been much success in ALS ever. But in any event, in working with sort of standard animal models in ALS, he really was able to show that cortisol modulation and specifically, you know, he has ideas of really where it's working in the brain And these animal models not just slowed the deterioration of ALS, but at least in the period from which he studied the animals, actually improved things. It actually clinically improved the animals. And it also, from a pathological point of view, increased their muscle fiber strength and muscle function. So it's a very intriguing finding. Now, you know, ALS is like Mount Everest. I mean, that is not an easy mountain to climb. It's a dire need. Many, many companies have tried to work on it. And all I can really tell you at this point is that the best evidence for the success are these successful animal testing, which has now been repeated several times. And as we like to send you the articles where you can find themselves, have now all been published in peer-reviewed journals. So we'll see. What I can tell you is that there's a group of investigators who are very interested in this mechanism, who are very interested in taking it forward. We're very excited to give it a try. It's a difficult area to work in, but wouldn't it be cool if we can actually provide some help for these patients?
spk05: Sure, that's helpful. And then secondly, in terms of the castrate-resistant prostate cancer program, What are the next steps after you select the optimal dose? Is that movement into phase three?
spk07: I think it's actually moving into phase two. I think that really at that point, you know, this is really a phase one piece study. I just want to remind, again, Matt, you may know this, but the whole audience, that it's really an intriguing idea. It has very good science behind it out of great places. And it basically is, as I said before, blocking a critical escape pathway for men who are receiving androgen modulation, but it's no longer effective. So that's the concept. The other practical point I want to remind everyone is that we are running a study with exocoralent, which is one of our cortisol modulators. The University of Chicago is actually running a very similar study with relacoral And we expect that both of these to approach kind of their dose finding finish line about the same time towards the end of the year. And then we will make a selection as to which of those compounds we bring forward into phase two.
spk05: Great. And that's helpful. Thank you. And then last question in terms of Coraline. You had, you know, great success in third quarter. What are you seeing – in the fourth quarter early on here in terms of, are you seeing continuing of that momentum in terms of new patient ads and starts?
spk07: Yeah, you know, we don't comment on quarters in progress, but we see, I think I'm okay saying to you, we see no diminution of the trend we have previously seen.
spk05: Thank you. Thanks again for taking the questions.
spk01: Your next question is from Fazine Ahmad of Bank of America. Your line is open.
spk04: Hi. Good afternoon, guys. Thanks for taking my questions. Sure. A couple on Coraline, if I could. Can you give us a little bit more detail about what the contribution of price and volume were to growth this quarter?
spk11: Yes. So, I mean, so we took a 5% price increase in March 1st of last year, or beginning of this year.
spk04: And I guess, yeah, go ahead.
spk02: I was going to say, from a year-on-year growth perspective, around 60% of the growth was due to volume and 40% due to price.
spk04: And I guess as this year has progressed, has that contribution from volume increased, despite the COVID headwinds?
spk07: Yeah, as Tazine, as Sean mentioned earlier, we now have more patients taking Coraline that have ever taken it and more physicians prescribing it.
spk04: Okay. And I guess we can move on to ovarian cancer. For your trial design for Phase III, are you expecting that you will only have to do one Phase III study, or would there be a need for two? And did you have an official end of phase two meeting with FDA before designing the study as it stands now?
spk03: Well, thank you for that question. This is Bill Geyer. So we're actively planning to meet with the FDA. And when we have all the information to have that discussion, we will within the next few months, as I think Joe said. At this time, we're planning on a phase three trial that's looking at the intermittent dose, because that's where we saw the most successful dose of relicorlin plus napaclitaxel. We plan on doing a controlled study, and that's a controlled study, versus an investigator choice of treatment. While that study will be larger than our phase two study, we basically just want to replicate the great results we saw in phase two, where we saw statistically significant improvements in PFS, as well as DORs. duration of response. And so we're going to actively work, as I said earlier, with a leading organization here in the United States that has a global connection. It's called the GOG, the Gynecological Oncology Group. And they're collectively just as excited as we are, if not actually sometimes more excited than we are, to progress this study forward and to also help us with the FDA and other regulators.
spk07: And so I'm just going to sum up because it was in there, Tizian. Our expectation is a single study.
spk04: Right, because I was assuming that because of the undermet need that that should be sufficient. So thanks for confirming. Okay, thanks guys.
spk07: You're welcome.
spk01: Your next question is from the line of Arthur Hay of HC Wainwright. Your line is open.
spk10: Good afternoon, gentlemen. This is Arthur for Arcade, and thanks for taking my question. So I guess... I want to touch on the NASH Phase 1 study for the myocardium. Could you guys give us more color on the study design as well as the patient inclusion criteria? And when could we expect initial data from that study?
spk03: Yeah, great question. And, you know, as I answer that question, let me just back you up a little bit because Patients with NASH have lived with that disease and progressed over decades. They typically start with non-alcoholic fatty liver disease and then progress to NASH where they have fibrosis and sometimes progress to cirrhosis. And the goal is to reverse that liver fat accumulation and reverse fibrosis over time. And it's common in NASH development programs to achieve those goals over the course of a year. And in our phase two study, and again, I'll get to your answer on phase 1B, but I got to remind you of the phase two study that Joe had talked about. What we saw really was with miracoralin, you know, unprecedented results for fat loss. When we looked at miracoralin at 600 milligrams and or 900 milligrams, you know, we saw reductions in liver fat for 40% to as much as 75%. We actually saw one patient have complete resolution of liver fat. in just four weeks. And that resulted, though, unfortunately, with a consequential rise in ALT and AST. And so as we look at those endpoints, we're trying to now design that Phase 1b study, which we have done so, and it has started, and we're actively recruiting that study. And that Phase 1b study is going to have four different cohorts looking at lower doses of miracorlin, starting at 150 milligrams, 300 milligrams, and 450 milligrams As well as a dose escalation scheme is one of the cohorts starting at 150 milligrams and up to a maximum dose of 600 milligrams. And each cohort is gated by an evaluation of safety and efficacy every four weeks and will continue up to 16 weeks. This is an open label trial, so we'll look at the safety and efficacy results as they come in for each cohort and we'll plan accordingly as we interpret those results.
spk10: Thanks for that color. So I just wonder, so for the endpoint evaluation, are you guys planning to use the image, or is there any biopsy involved for the NASH study?
spk03: No biopsies involved in this study. We're using MRI-PDFF, which is a MRI version to look at liver fat within, and that's what we did in the Phase II study as well.
spk10: Okay, thanks. And we could expect the initial data from next year, probably?
spk03: As I said, we're going to be looking at the data for each cohort, and there's four-week dates, and so we'll be looking at that data as it comes along. It's basically a six-month trial. But internally, of course, we'll be seeing the data as it comes in on a regular basis.
spk10: Okay, thank you. And my next question is regarding the cap allocation. So with the almost half-billing cash in hand, Besides their internal pipeline development, are you guys contemplating any business development target? Just curious. Thanks.
spk02: Hi, Arthur. It's Adelbach. Thanks for the question. We are cognizant of our large cash position and regularly evaluate our capital allocation alternatives, but we have nothing new or new updates to report at this time. Yeah, I just...
spk07: Just to underscore that, though, yes, we really are aware of how successful the business that Sean has run has been. We're continuing evaluating where we would like to put the cash we don't need for our clinical programs. Obviously, that's the first priority. So it is an active topic, really, at all points. And should we have updates, you will be right on the list to know. So thank you, Arthur. Thanks for the question.
spk10: Sounds great. Thank you. Thank you for taking my question.
spk01: Your next question is from Alan Leong of BioWatch. Your line is open.
spk09: Thanks for taking my questions. Joe, Charlie, Adelback, and Sean, good to hear from you. And we're all pleased to make your acquaintance. Congratulations on the quarter. I want to refer back to something that was mentioned earlier. More patients have Cushing's than previously thought. I wonder if I can have some color on this. Is this reflecting more the severe patients, the classic case of patients, or is it the endocrinologists are beginning to lump in less severe cases?
spk11: Yeah, thanks, Alan. This is Sean. I'll answer that, and Joe, please add any color that you'd like to, but I want to talk a little bit about sort of the historical data around this disease. So the population data that is often referenced and has been around for many years suggests that the prevalent patient population is around 20,000 patients a year, half of whom are cured by surgery. I think something that's important, though, to note about that data, and you just touched on it, is that 70% of those patients have Cushing's disease. And for those that aren't as familiar with the illness, that's patients with disease of pituitary origin. And what's happened really over time, and most recently I would say in the last five plus years, is there's really mounting evidence showing that there may be more patients with adrenal hypercortisolism than previously thought. And there really is a large amount of independent research and multiple publications, which we'd be happy to share, that support this. So, you know, there's not a million hypercortisolism patients. I mean, this is still a rare disease. But could there be 30 or 40,000? Yes. I mean, it wouldn't surprise me if there were. And as education, you know, increases, physicians are screening more, awareness is being raised, you know, I think we'll see that evolve over time and there will be a better understanding of what this market indeed looks like.
spk07: No, I have nothing to add.
spk09: Go ahead. I was going to say I suspect your gradient trial is going to be key.
spk07: Yeah, it's really, Alan, very nice to be able to do that. That is the first controlled study in patients with dysfunctions. specific form of Cushing syndrome. And we're able to do it in the standard kind of double-blind fashion because many of these patients are not treated at all for their hypercortisolism at this point. They're just treated with seven different medications for seven different symptoms. So I'm really looking forward to add that to scientific literature and hopefully be helpful in clinical care very quickly.
spk09: I've got a couple more questions, but they tend to be more philosophical. I want to follow up on Matt Kaplan's question on court 113-176, but really on how your portfolio may be applied to CNS and neuromuscular diseases. Because I'm watching this, and cortisol dysregulation and metabolic problems are prominent in these patients. And I'd like to see the drugs be successful with CNS mechanisms, but it's still not ever. But I look at your... And if all it did was help mitigate their metabolic problems, that's still huge.
spk07: So I don't know if you have a color on it. I'll give you – I can give you the five-hour version of that.
spk09: You know how it works.
spk07: but I'll shorten it up for you. You know, look, as you know, Alan, I'm a psychiatrist by training. I think the brain is the most sensitive organ in the body to hormonal dysregulation, specifically cortisol dysregulation. But historically, psychiatric and neurologic studies have been among the most difficult to do. And as you know, many large companies have foundered in that area. and programs have been cut, and so on and so forth. And so I have a great intellectual interest in going in that area. I think there's tremendous need and possibility. I know, as you know, we have a study now in post-traumatic stress disorder that's being run by the VA. There's good animal data in another neurologic disease, Huntington's disease. So I'm really hoping that in sort of the 5 to 10-year zone, we will really be back in a serious way into CNS disorders. It would really be wonderful to give some help to those patients, and cortisol modulation has lots of good reasons to give it a try. So sort of one thing at a time. We have a very full plate as it is, but I do think that over time we will be feathering in CNS disorders as we have more information. So cross your fingers.
spk09: You do have a full dinner plate, and that's what I call it. And you can see the clinical pace quickening and the portfolio expanding. Very interesting for a small company. And yet you're opening up two new drugs to the clinic. Is this what you envisioned as a game plan, a growing clinical portfolio in play, but even fatter than today? Are you still hoping to introduce a new drug roughly every year?
spk07: That really is the goal. And cortisol modulation is a very broad and important, it just is a very important platform. And we don't wanna overstep. We really think very hard about what we can actually get done. But yes, I really do think that's a fair statement of our goal, which is to add a compound a year. And if the evidence is there for it, to add a disorder a year. Can't promise that that's gonna be the case. We'll follow the evidence where it goes. But I think that we're really on to something. I think the cortisol modulation is a big area, and we're first.
spk09: Thanks for answering my questions. I hope it comes true. You're kind of interesting. It's an interesting situation, being such a small company, but trying to create and execute a large portfolio. Thanks, and good luck.
spk07: Yeah, and we're not as small as we used to be, Alan. You remember that, right?
spk09: Over the days.
spk07: All right. Well, listen, I'm going to stop here. Great to talk to all of you. Obviously, as we have news, we will put it out. Otherwise, we'll talk to all of you next quarter. And, you know, hope you enjoy what's left of the fall and the early winter. Talk to you soon. Bye-bye. Thank you.
spk01: Thank you, speakers. Ladies and gentlemen, this concludes today's conference call. Thank you all for joining. You may now disconnect.
Disclaimer