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.
spk08: Hello. Thank you for standing by. Welcome to Core SEP 3rd, Pewter's conference call. At this time, all participants are on a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask the question during this session, you will need to press star 11 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 11 again. I would now like to turn the call over to Adelback McCord. You may begin.
spk04: Hello, everyone. Good afternoon, and thank you for joining us. Today, we issued a press release announcing our financial results for the second quarter and providing a corporate update. A copy is available at coursef.com. Our complete financial results will be available when we file our Form 10-2 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 might cause actual results to be materially different from those such statements express or imply. 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 and 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 second quarter of 2024 was $163.8 million, an increase of 39% compared to the second quarter of the prior year. We expect our revenue growth to continue and have increased our 2024 revenue guidance to $640 to $670 million. Net income was $35.5 million in the second quarter compared to $27.5 million in the second quarter of the prior year. Our cash and investments at June 30th was $492.5 million. I will now turn the call over to Charlie Robb, our Chief Business Officer. Charlie?
spk01: Thanks, Ataback. I don't have much to report this quarter. As many of you know, in March 2018, we sued Teva to stop it from marketing a generic version of Corlum in violation of our patents. In December last year, the trial court ruled against us. We've appealed that decision to the Federal Circuit Court of Appeals. Briefing in the matter is complete. The documents are available at the government's PACER website, if anyone would like to review them. And the next step is for the Federal Circuit to schedule oral argument. The timing of oral argument and issuance of an opinion are entirely up to the Federal Circuit and can't be known with certainty. As I said before, a reasonable expectation would be for oral arguments to take place in the fourth quarter, perhaps late in the third quarter of this year, with a decision issuing in the first quarter of 2025, possibly very late in the fourth quarter of 2024. If we prevail, TEVA would lose FDA approval of its product and have to remove it from the market, at least until the expiration of our patents in 2037. As I've said before, we're eager to advance this appeal. We strongly believe that our position is correct, Federal Circuit, with its deep expertise in patent law, will agree. I'll now turn the call over to Joe Belanoff, our Chief Executive Officer.
spk06: Joe? Thank you, Charlie, and thank you, everyone, for joining us this afternoon. This has been an extremely active period at CoreSept. Our commercial business continues to be very strong, and we are making progress in all of our clinical development programs. The past quarter marked several significant milestones for our endocrinology division. I will take a few minutes to elaborate on each area of progress. Individually, they are of great importance and collectively even more so. The commercial growth in our endocrinology division was driven by another record number of new coralline prescribers and by a record number of patients receiving coralline. As physicians become increasingly aware that hypercortisolism is much more prevalent than previously assumed, they are screening and treating more patients. When choralim is prescribed, we use the expertise and infrastructure that we have developed and refined over many years to support physicians and patients. We have known for some time that there were more patients who would benefit from screening for Cushing syndrome and ultimately from treatment than was commonly recognized. The findings from the prevalence portion of the CATALYST study make it clear that there are many more patients with hyperchorizalism than was previously recognized. Catalyst is the largest and most rigorous clinical study ever conducted to examine the prevalence of hypercortisolism in patients with difficult-to-control type 2 diabetes. Of the first 1,055 patients enrolled in the Catalyst study, one in four were found to have hypercortisolism. This is a far higher prevalence rate than was assumed, with large implications for patient care. Hypercortisolism was even more common in patients in this study with already recognized cardiovascular disease, particularly in those who needed three or more medications to manage their hypertension. More than a third of this group of patients had hypercortisolism. The catalyst study was led by the top diabetologists in the United States, and the results from the prevalence portion of the study were presented at the American Diabetes Association's annual scientific sessions in Orlando last month. Much has subsequently been written about this presentation. The second portion of the catalyst study is ongoing. In this part of the study, patients are randomized to receive either coralline or placebo. The study results will be available at the end of this year. As the awareness of Cushing syndrome increases, we are simultaneously working to advance our proprietary selective cortisol modulator, relacoralline. Reliquaryland has unique characteristics, and our confidence in its efficacy and safety profile has increased with the results of the GRACE study. As you recall, GRACE has two parts. In the open-label phase, 152 patients with Cushing syndrome, in either hypertension, hyperglycemia, or both, received reliquaryland for 22 weeks. Patients who met pre-specified improvements were given the opportunity to enter the trial's randomized double-blind withdrawal phase, in which half of the patients continued to receive reliquarylant and half received evo for 12 weeks. Patients in the open-label phase of GRACE exhibited clinically meaningful and statistically significant improvements in hypertension, hyperglycemia, weight, lean muscle mass, waist circumference, cognition, Cushing's quality of life score, and other measures of clinical importance. 63% of the patients with hypertension met the study's response criteria. Patients who enter the randomized withdrawal phase of GRACE experience mean systolic and diastolic blood pressure improvements of 12.6 and 8.3 millimeters of mercury as measured by 24-hour ambulatory blood pressure monitoring. The p-value on their change from baseline was less than 0.0001. Fifty percent of the patients with hyperglycemia met the study's response criteria. The hyperglycemic group consisted of patients with diabetes and those with impaired glucose tolerance, or prediabetes. For the patients who entered the randomized withdrawal phase, a reduction in mean hemoglobin A1c of 0.7%, p-value less than 0.0001, and a reduction in mean fasting glucose of 25.2 mg per deciliter, p-value of 0.006, was achieved. In the randomized withdrawal phase, which compared patients taking relacoralin to those taking placebo, GRACE met its primary endpoint of maintenance of blood pressure control. The odds ratio, which is the primary endpoint in the statistical analysis plan in place with the FDA, was 0.17, with a p-value of 0.02. Patients taking relacoralin were six times more likely to maintain their blood pressure response compared to those taking placebo. In addition, patients who continued to take reliquaryland in the randomized withdrawal phase maintained the broad range of improvements observed in the open-label phase, while those who received placebo experienced a significant worsening of their symptoms. In both phases of GRACE, reliquaryland was well-tolerated, consistent with its known safety profile. Due to its unique mechanism of action, there were no reliquaryland-induced instances of hypokalemia. In addition, there were no cases of drug-induced endometrial hypertrophy. no cases of adrenal insufficiency, and no cases of QT prolongation, which was independently confirmed. In June, we presented results from GRACE at the Endocrine Society Annual Meeting in Boston and the Heart and Diabetes Conference in Philadelphia. GRACE's clearly positive results are a welcome development for patients with Cushing syndrome and constitute a significant step forward towards our new drug application for relacoralin, which we plan to submit in the fourth quarter. GRACE is not our only phase 3 trial of relacoralin in patients with hypercortisolism. GRADIENT is a randomized, double-blind, placebo-controlled study in 137 patients whose hypercortisolism 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 and include a significantly higher risk of premature death. We expect RADIANT to produce valuable data about the treatment of an etiology of Cushing syndrome that affects many patients. Enrollment is complete, and we expect data in the fourth quarter of this year. As you know, we are also studying relacoralant as a treatment for different types of cancer mediated by cortisol activity. Our most advanced oncology program is in platinum-resistant ovarian cancer. We completed enrollment of 381 women in our pivotal Rosella study, and expect to have enough events to analyze the primary endpoint of the study, progression-free survival, by year end. Women with platinum-resistant ovarian cancer are in urgent need of new treatment options. The goal of using relacoralin in this context is to resensitize ovarian tumors to the effects of chemotherapy by blunting the anti-apoptotic effect of the patient's excessive cortisol activity. Our goal for Rosella is to replicate our successful 178-patient controlled Phase II trial, which showed that women who received relacoralin intermittently, the day before, the day of, and the day after they received napaclitaxel, exhibited a statistically significant improvement in progression-free survival and duration of response compared to the group who received napaclitaxel monotherapy. Women in the relacoralin group also lived longer than those in the comparator arm. 29% of the patients who took intermittent relacoralin were alive two years after study start versus only 14% who took napaclitaxel alone. Importantly, the women who received relacoralin plus napaclitaxel experienced no additional side effect burden compared to those who received napaclitaxel alone. The results from the study were published in the Journal of Clinical Oncology in June 2023, with an accompanying editorial and presented at multiple U.S. and European medical conferences. The design of Rosella closely tracks our previous phase two trial. Women are randomized to one-to-one to receive either relacloralin plus napaclitaxel or napaclitaxel alone. The primary endpoint of Rosella is progression-free survival, with overall survival a key secondary endpoint. We are conducting this study in collaboration with leading clinicians from the Gynecological Oncology Group, or GOG, in the United States, and the European Network of Gynecological Oncology Trials, or NGOT, group in Europe, and deeply appreciate their enthusiasm and support. In anticipation of a successful outcome, Roberto Vieira has joined us as president of our oncology division, and we have begun to make a number of other critical hires to ensure that we can move as quickly as possible following the conclusion of Rosella, to bring relacoralin to the women who can benefit from it. We are also evaluating relacoralin as a treatment for prostate cancer and adrenal cancer by exploring two different mechanisms of action. Leading academic researchers and clinicians hypothesize that cortisol modulation may block an important tumor growth pathway in prostate cancer. Cortisol stimulation is thought to be a major reason why patients with prostate cancer treated with a widely prescribed androgen receptor antagonist, enzalutamide, eventually experience resurgent disease. Deprived of androgen stimulation, their tumors switch to cortisol activity to stimulate growth. Adding a cortisol modulator to androgen deprivation therapy could close this tumor escape route. Our collaborators at the University of Chicago are currently enrolling a randomized placebo-controlled phase two trial of relacorlin plus enzalutamide in patients with prostate cancer before these patients have had an initial prostatectomy. In adrenal cancer, patients' tumors produce excess cortisol in about 50% of cases. Unfortunately, patients with this form of adrenal cancer virtually never respond to immunotherapy. Sadly, adrenal cancer usually progresses rapidly and is almost always a deadly disease. Because cortisol suppresses the immune system, it may blunt the effectiveness of cancer therapies intended to stimulate the immune system. Our hypothesis is that adding a cortisol modulator to immunotherapy, such as checkpoint inhibitors, may enhance their effectiveness. We enrolled 14 patients with advanced adrenal cancer with tumors that produce excess cortisol in a phase 1B trial of relacoralant plus the PD-1 checkpoint inhibitor pembrolizumab. As hoped for, treatment with relucoralin produced an improvement in these patients' Cushing syndrome and their quality of life. However, it did not result in an observed change in tumor progression in this end-stage group. We are evaluating next steps to further understand the role of cortisol modulation in combination with immunotherapies and this and other types of cancer. Our research team has developed a library of more than 1,000 selective cortisol modulators with distinct pharmacodynamic properties. Some are more potent at modulating cortisol activity across many tissue types. Some are tissue-specific. Some are very potent in oncologic models, some less so. Some get into the brain, some don't. One of the compounds discovered by our scientists that is highly effective at getting into the brain is dazocoralin. We have advanced dazocoralin into clinical studies based on compelling data that showed improved motor performance and reduced neural inflammation and muscular atrophy in a commonly used mouse model of ALS. A randomized, double-blind, placebo-controlled Phase II DASLs trial of dazocoralin is fully enrolled and ongoing at clinical sites in Europe, the United States, and Canada. 249 patients with ALS have been randomized to receive dazocoralin or placebo for 24 weeks. The primary endpoint utilizes the ALS functional rating scale. We expect data by year-end. Finally, I'll turn to our program in MASH, which stands for Metabolic Dysfunction Associated Steatohepatitis. MASH is a serious liver disease that affects millions of patients in the United States. Cortisol modulation may serve as an effective treatment for MASH because cortisol activity has been implicated in both the initial development and progression of this disease. Our Phase 1B dose-finding study of miracorrelant found that patients who received 100 milligrams orally twice a week for 12 weeks experienced a 30% reduction in liver fat and improvements in liver enzymes, markers of fibrosis, and key metabolic and lipid measures, such as HOMA-IR, serum triglycerides, and LDL. Importantly, miracoralin was also very well tolerated with no apparent GI side effects. We hope to expand on these encouraging results with our randomized double-blind placebo-controlled Phase IIb MONARCH study. We are enrolling two cohorts in this study. The first cohort has a planned enrollment of 120 patients with biopsy-confirmed MASH, randomized two-to-one to receive either 100 milligrams of miracoralin twice weekly or placebo for 48 weeks. The primary endpoint for this cohort of the Monarch study is reduction in liver fat with MASH resolution and fibrosis improvement as key secondary endpoints. The second cohort has a planned enrollment of 75 patients with presumed MASH based on non-investive diagnostic tests. Patients in this cohort will be randomized two to one to receive either 100 milligrams of miracoralin twice weekly for six weeks, followed by 200 milligrams of miracoralin twice weekly for 18 weeks, or placebo for 24 weeks. In this cohort, the primary endpoint is also reduction in liver fat. This is an extremely exciting time at Corset. We are rapidly approaching transformational milestones for the company and more important for patients in need. Our commercial business is strong and growing. The prevalence results from our catalyst trial make it clear that there are far more patients with Cushing syndrome than was previously assumed. The GRACE trial results demonstrate that we've developed a clearly superior treatment for patients with Cushing syndrome. By the end of this year, we expect data from our gradient and catalyst studies in Cushing syndrome our pivotal Rosella study in ovarian cancer, and our DASL study in ALS. Every employee at Corsept and the partners and collaborators with whom we work understands the significance of the work we do. Collectively, we are driven and guided by a sense of urgency to support patients with Cushing syndrome and all of the other disorders where cortisol modulation can make a difference. Operator, let's proceed now to questions.
spk08: Thank you. Ladies and gentlemen, as a reminder to ask the question, please press star 11 on your telephone and then wait to hear your name announced. To withdraw your question, please press star 11 again. Please stand by while we compile the Q&A roster. Our first question comes from the line of Matt Kaplan with Lattenberg. Your line is open.
spk09: Hey, guys. Thanks for taking the questions and congrats on the strong quarterly results. Joe, you mentioned in your prepared remarks that the screening, you've seen an increase in screening and treatment in terms of use of coralline. I guess, where are we in terms of the awareness of the prevalence of hypercortisolism in the endocommunity now and in terms of the increase in screening?
spk06: Thank you, Matt, and good to hear from you. I really think we're just at the beginning of that. I think that the results that you're seeing in the second quarter really are not a function of what the results released in the catalyst study in late June. But in July, we certainly have seen a pickup in interest. I think that's going to continue through the year. And I think ultimately the treatment portion of the catalyst study will also be very meaningful. But the short answer to your question is I think we're really just at the beginning of that expansion.
spk09: OK, that's helpful. And then just staying on quorum for a moment, what are you seeing in terms of generic quorum in the marketplace now?
spk06: Okay. I'm going to pass you over just to reintroduce you to Sean Madduke, who is the president of our endocrinology division.
spk07: Hey, Matt. Thank you for the question. I guess I'll answer it two ways. The first question is, what are you seeing in the marketplace? You know, the Teva product has been available in the channel for many months, so it's out there. but it has had very little impact on our business.
spk09: Okay, okay. And just one more question maybe before I jump back in the queue. I guess following the presentation of the GRACE open label and randomized withdrawal results at the recent conferences, what's been the feedback you've been getting from the endo community so far?
spk06: Again, I'd like to introduce you, reintroduce you to Bill Geyer, who is our Chief Development Officer. Bill?
spk05: Great. Thank you for that question. Well, the reception from investigators and clinicians has been outstanding, to be honest. They were excited about all of the reliquarolent results because we have a positive study, so we hit our primary endpoint. But beyond that, we've seen that reliquarolent has hit almost every secondary and exploratory endpoint because we see a broad improvement across a broad range of signs and symptoms of Cushing syndrome, and these positive results give clinicians insight into what they should expect in their patients. Another key piece is, you know, that promise of what we had hoped to improve on the safety profile, and they take away that due to reliquarolin's unique mechanism of action, the robust and broad efficacy was seen without reliquarolin-induced AEs like hypokalemia, vaginal bleeding with endometrial thickening, no adrenal insufficiency, and no QT prolongation. So when you put that package all together, the clinicians were very pleased to see that what we promised within relic correlates being unique in its selectivity has borne out to show that in the GRACE study.
spk09: Very helpful. And I guess maybe just one more, Bill, while I have you. I guess as we look forward to the DASL results, what would be a clinically meaningful change in the ALS-FRS as we look to that?
spk05: Yeah, so in talking with... ALS experts, we feel that the functional rating scale, the ALS functional rating scale, we are powered to see a 2.4 point difference in the functional rating scale, and we believe that that is, and so do investigators and clinicians, that's a clinically meaningful change in the ALS functional rating scale. So we're empowered to detect that difference, and it will be a clinically significant difference.
spk09: Thanks again, guys. Thank you, Matt. Thanks, Matt.
spk08: Will you stand by for our next question? Our next question comes from the line of David Amselem with Piper Sandler. Your line is open.
spk02: Hey, thanks. So just had a few. First, regarding the CoreLim AG, can you talk about your thought process for bringing an AG into the marketplace and how does that play into your thinking regarding the potential for one or two more generic entrants, in other words, Sun or HICMA. Just wanted to get your thought process there on the AG. That's number one. And then secondly, in terms of the new prescribers, are these coming from squarely in the endocrinology community or maybe adjacent to the endocrinology community, in other words, diabetologists? Or maybe a better way of asking is, are you getting a lot of traction among diabetologists who historically have not prescribed the drug and have not screened for Cushing's? So that's number two. And then lastly, as you think about the evolution of this space with a prevalence being wider across than what the community had thought it to be. How does that play into how you're thinking about the pricing of Relic Coraline? I know it might be early to ask that, but I think it's a fair question, just given that the prevalence of this space and our understanding of it is evolving. Thank you.
spk06: Thank you, David, and thanks for those questions. I think all of them really fall right in Sean Maduk's house, so I'm going to pass it over to him.
spk07: Yeah, thanks, David. So I'm going to try to break these down. That's a lot of questions together, so I may have to check in, but I think I covered it. So your first question was around the AG and sort of what drove our thinking around that, and the reality is that over time, given the availability of a generic in the market, that payers may mandate that their patients receive a generic drug. and making the AG available allows us, of course, to ensure that these patients and their prescribed physicians have continuity care and are still able to access the robust patient support services and physician support services that we provide. The second part of your question then was how does, I believe you asked, how does this influence what might happen with other potential generics entering the market? speak to what their specific plans are, but I will remind everybody that TEVA announced their launch on January 19th, and by statute, any additional filer, any second filer, can enter six months after the first filer has launched, provided that they have the FDA approval. And the earliest possible date was July 19th, and that date has passed. And as far as we know, neither San nor HICMA has FDA approval. All right, so the third part of the question was around new prescribers, and I guess how widely distributed are those across specialties? And I can tell you that, you know, we've continued to promote broadly to endocrinologists and to other patients that we believe could be seeing patients with hypercortisolism within their practices. So we educate through our field force and through other initiatives, and we've seen new prescribers emerge in the diabetology space, the endocrinology space, as well as others. And then the last question was specifically about pricing. Can you please maybe restate what the specific question was around pricing?
spk02: Yeah, sure. And I apologize. I know it was a mouthful. So in terms of the pricing, just with this space having a wider prevalence, how does that impact how you're thinking about pricing of Relic Orland? I guess what I'm trying to ask is, is pricing of Relic Coraline going to be somewhat below what the AG for Coraline is priced at or the brand? That's the most direct way I could ask it.
spk07: That's a great question. Thank you. So right now we expect that pricing will be roughly in line with Coraline. There are real arguments, however, that Relic Coraline could be priced at a premium to Coraline given its favorable efficacy and safety profile. Now the question around the expansion of of the population, I mean, we recognize that Coraline and the future Rela Coraline are high-priced drugs that's priced for, right now, a smaller patient population. We know that each market has a price threshold, though, and that a market with 2,000 patients is obviously different than one with 20,000 or 200,000. The hypercortisone market is definitely still growing, and when we know where we're at, our price will accurately reflect that market. And that's our social contract. That's something that we firmly believe. Thank you, David.
spk02: Thank you.
spk08: Thank you.
spk04: Thank you.
spk08: Please stand by for our next question. Our next question comes from the line of RK with HC Wainwright. Your line is open.
spk00: Thank you. Thanks for taking my question. Sure. So just on the quarterly revenue growth, I'm just trying to understand, you know, You said that some of the uptake that we could think about coming from Endo, it was actually happening in July. So going from where we are now, how should we think about the mix and also what are you taking into account when you are changing your guidance or you're upping your guidance? from where it was at the end of the first quarter.
spk07: Yeah, thank you for the question. This is Sean again. And I think your question is related to Catalyst and diabetologists. The reality is there's been very little to no impact from Catalyst in our year-to-date results, and we have included modest benefit in our updated guidance. That said, I do think that the results presented at ADA that Joe had highlighted are going to be increasingly meaningful over time. and that we could see more patients in the second half of the year than was initially expected. When the results of the treatment arm of the study are available at the end of the year, I think a very meaningful change could take place. So we've taken all those factors into account. We take many factors into account when we look at our range, and the range that we've stated is our best thinking. Thanks, Arquette.
spk00: Thank you.
spk08: Will you stand by for our next questioner? Our next question comes from the line of June Lee with Truist. Your line is open.
spk03: Hey, congrats on the strong quarter, and thanks for taking our questions. We have two questions. First is, what's the reason for the delay in RELA-Cortland NDA submission to 4Q, and what's the rate-limiting step for that submission? And then the second question is, regarding the Phase 4 catalyst trial, how important is the outcome of the Part 2 submission in expanding the TAM, specifically, you know, regardless of the outcome of part two in managing glucose levels, would the patient still need to be treated for hypercortisolism? Thank you.
spk06: I'll answer just the second question first, if you wouldn't mind, June. The answer is that we think that it's very meaningful, that we think that the problem with these patients, just to sort of back up, The average hemoglobin A1C in patients who entered the catalyst study was 8.8. And these are patients who were treated by, you know, really in my estimation, but many others, the best diabetologists in the country using the best medications, including many who were taking GLP-1s and so forth. These patients clearly have another problem. And in a quarter of them, it's hyperchlorosol. I mean, that clearly is an issue for them. Now, I think the treatment study is very meaningful. I think the question, you know, and we have, you know, really high hopes and expectations it's going to do, the medicine is going to do exactly what we think it's going to do. But I really do think that showing that these patients exist, which has really already shaken the heads of these diabetologists, and showing there's really something you can do about it, I think it's going to be very, very meaningful. I'm going to pass just so Charlie can speak here. Charlie Robb, who is our... Head of Regulatory and Chief Business Officer will answer your first question.
spk01: Yeah. Hi, June. Yes. In the course of, you know, just to back up a little bit, any company, including ours, that's preparing to submit an NDA is in regular conversation with the FDA. A lot of information is exchanged. Things are discussed. And it was after that, back and forth, we decided that to include data from our gradient trials, which is, to remind everyone, is fully enrolled, and we'll have that date in the fourth quarter. But we decided to include that in the NDA submission, and that date will be available in the fourth quarter, so that's when we'll be able to submit the NDA. That's all there is to it.
spk06: All right. Thank you. Thank you, June. All right. Well, listen, it's a late summer afternoon for everyone. Thank you for dialing in, and we will speak to you in a quarter.
spk08: This concludes today's conference call. Thank you for your participation. You may now disconnect.
Disclaimer