Assistant Managing Editor

Corcept Therapeutics Inc. reported positive top-line data from its Phase III trial of Corlux (mifepristone), a cortisol receptor (GR-II) antagonist, in Cushing's syndrome, news that puts the Menlo Park, Calif.-based biotech on solid footing as it heads into ex-U.S. partnering talks.

An acquisition might not be out of the question, either, given big pharma's growing attraction to the orphan drug space. Cushing's, a condition that results from prolonged exposure to high levels of cortisol, affects about 20,000 people in the U.S., and there are no therapies currently approved, though antifungal ketoconazole sometimes is used off label.

Corcept's 50-patient, open-label Phase III trial involved two groups of patients with endogenous Cushing's syndrome: those who were glucose intolerant and those who were diagnosed with hypertension, but not glucose intolerant. Each group had its own primary endpoint, both of which were met with statistical significance.

In the glucose-intolerant group, the response rate, defined as an achievement of a 25 percent or greater improvement in glucose tolerance at 24 weeks, was 60 percent (15 of 25 patients), "significantly above the 20 percent hurdle rate" established at the trial's outset, CEO Joseph Belanoff told investors on a conference call. The "p" value was 0.0001.

Patients in the hypertension group were evaluated for a 5 mm or greater improvement in diastolic blood pressure at 24 weeks. The response rate for those patients was 43 percent (nine of 21 patients), again beating the 20 percent hurdle, with a "p" value of 0.01.

Despite the clearly positive results, Corcept's shares (NASDAQ:CORT), trading at more than 24 times their normal volume, fell 29 cents, or 6.9 percent, to close Wednesday at $3.90.

That reaction could be a typical drop-off following the stock's modest run-up ahead of the Phase III Cushing's data, or it could be that investors are waiting for full data from the study, likely to be presented at the annual Endocrine Society meeting in June.

A key secondary endpoint of the trial was established to measure global clinical improvement, and those data could be available as early as the first quarter of 2011. Other secondary efficacy measures include changes from baseline to the end of the study in fasting plasma glucose, hemoglobin A1c, change in glucose-lowering medications, systolic blood pressure, change in antihypertensive medications, body composition, weight, bone turnover and bone density, cognitive/psychiatric assessments, metabolic functions and quality of life.

"Cushing's is a complex disease, and it affects many organ systems," noted Corcept President Robert L. Roe. He said the firm is still analyzing data from the secondary endpoints. "I fully expect that we would meet many of those, as well."

Piper Jaffray analyst Ian Somaiya also was optimistic. "Based on conversations with physicians involved in the trial, we expect these endpoints to continue to support approval and adoption."

Corcept is on track to file an NDA by the end of the first quarter of next year and will seek a six-month priority review. "I think an orphan drug with this kind of benefit is certainly a good candidate for that kind of review," Roe said.

If the FDA agrees, Corlux could hit the market late next year. Corcept plans to handle the U.S. marketing on its own, confident that it can reach a subset of endocrinologists with a small field team. Outside the U.S., the firm is looking for a partner.

"Today's data support a lucrative licensing deal in Europe," Piper Jaffray's Somaiya wrote in a research report.

In the meantime, Corcept is continuing the trial's extension study.

Belanoff said 90 percent of patients in the Phase III opted to continue with treatment and those who declined did so because they lived far from the study centers, which made the frequent visits inconvenient.

Most of the company's focus over the past few years has been on Corlux, which it is also testing in a Phase III trial in psychotic features of psychotic depression. Corcept has raised more than $60 million in the past three years, largely to help fund those late-stage programs. As of June 30, it had about $35.4 million in cash, but Corcept likely will need more to support pre-commercialization activities in Cushing's.

In August, the firm filed a shelf registration statement to raise up to $100 million.

Beyond Corlux, the company has CORT 108297, a small-molecule GR-II blocker, in Phase I development to prevent weight gain associated with antipsychotic drugs.