Earnings Call Transcript - CORT Q3 2020

Operator, Operator

Good day, and welcome to the Corcept Therapeutics Conference Call. Today's call is being recorded. At this time, I would like to turn the call over to Charlie Robb. Please go ahead.

Charlie Robb, CFO

Thank you. Good afternoon, everyone. I am Corcept's Chief Financial Officer. Today, we issued a press release announcing our financial results for the third quarter and providing a corporate update. A copy is available at corcept.com. Complete results will be available when we file our Form 10-Q with the SEC. Today's call is being recorded. A replay will be available through November 17, 2020 at 1-888-203-1112 in the United States and 1-719-457-0820 Internationally, passcode will be 6800706. Statements made during this call other than statements of historical facts are forward-looking statements based on our plans and expectations that are subject to risks and uncertainties, which might cause actual results to differ materially from those such statements expressed or implied. These risks and uncertainties include, but are not limited to, our ability to operate our business and achieve our goals during the COVID-19 pandemic and thereafter, including our ability to generate revenue and cash reserves sufficient to fund our commercial operations and development programs; the availability of competing treatments, including generic versions of Korlym; the initiation or outcome of litigation; our ability to obtain acceptable prices or adequate insurance coverage and reimbursement for Korlym; and risks related to the development of our product candidates, including their clinical attributes, regulatory approvals, mandates, oversight, and other requirements; and the impact of the COVID-19 pandemic on our employees, consultants, and vendors as well as physicians, patients, insurers, regulators, and practice of medicine generally. 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 our revenue guidance, cash flow and expected growth; our stock repurchase program and its intended funding process, the impact of the COVID-19 pandemic on our commercial operations, financial performance, clinical development programs, physicians, payers, and patients, and expectations regarding our financial performance and clinical development program after the COVID-19 pandemic is brought under control; physician awareness of hypercortisolism and the selection of Korlym as the optimal medical treatment; the timing, cost, and outcome of litigation, including our lawsuits against Teva Pharmaceuticals and Sun Pharmaceuticals and Teva's challenge to the validity of one of our patents from the Patent Trial and Appeals Board; the scope and protective power of our intellectual property; the benefits of orphan drug designation; the progress, enrollment, timing, design, and results of our clinical trials; and the clinical and commercial attributes of relacorilant, exicorilant, miricorilant, and our other selective cortisol modulators. We disclaim any intention or duty to update forward-looking statements. Revenue for the third quarter was $86.3 million, a 6% increase in the third quarter of 2019. Third quarter GAAP net income was $21.6 million compared to $26.3 million in the same period last year. Excluding non-cash expenses related to stock-based compensation and the utilization of deferred tax assets together with related income tax effects, non-GAAP net income in the third quarter was $30 million compared to $37.8 million in the third quarter of 2019. Our cash and investments were $444.2 million on September 30, an increase of $34.7 million from June 30. Upon consideration of our strong financial position and prospects, our Board of Directors has approved a program running through September 30, 2021, to repurchase up to $200 million of our common stock. We will determine the timing and size of any repurchases based on market condition, our stock price, and other factors. We believe revenue from our Cushing’s syndrome business, together with our cash on hand, will be sufficient to fund our commercial activities in our current and planned clinical development and drug discovery programs, as well as our program to repurchase $200 million of our common stock. Now, a brief legal update. In March 2018, we sued Teva Pharmaceuticals in Federal District Court to stop it from marketing the generic versions of Korlym in violation of our patents. Our lawsuits stayed final FDA approval of Teva's proposed product for 30 months, a period which ended on August 1. Discovery is underway. Originally, trial was set to begin February 2, 2021. Last month, the Court vacated that date and ordered the parties to complete trial preparations by March 17, 2021. A new trial date has not been set. It could take place any time after March 17. Teva has also challenged the validity of one of our patents, the 214 patent, in a proceeding known as a post-grant review, or PGR, before the U.S. patent office's Patent Trial and Appeal Board, or PTAB. As many of you know, oral argument in that matter was heard on September 2. We expect the PTAB to embrace this decision on or around November 19. The losing party may appeal to the Federal Circuit Court of Appeals, during which time the patent will remain valid. It is important to note that Teva is barred from challenging the validity of the 214 patent in the District Court case using arguments they could have raised in the PGR. While Teva’s attorney will battle and try to contest this, the rules are intended to prevent Teva from getting a second chance at this issue. In any case, appeals to the Federal Court usually take about 12 to 16 months to resolve. If such an appeal takes place, the soonest we expect definitive resolution of the PGR is the fourth quarter of 2021. Sun Pharmaceuticals is also seeking to market generic Korlym. Our lawsuit against Sun has stayed final FDA approval of Sun's proposed product until December 8, 2021, allowing a decision from the District Court whether the patents we have asserted against Sun are invalid, unenforceable, or not infringed. Our dispute with Sun is separate from our litigation against Teva and is following its own timeline. The Markman hearing in the Sun case was set for November, but that date has been vacated and a new date has not been suggested yet. Additionally, no trial date has been set. Predicting the timing of any District Court litigation is difficult, and the challenges posed by the COVID-19 pandemic compound the problem. The Court has vacated our original trial date with Teva but has not set a new one. Whenever this trial takes place, we look forward to presenting our patents before the judge.

Joseph Belanoff, CEO

Thank you, Charlie. The challenge posed by the COVID-19 pandemic underscores just how fortunate Corcept is to have a stable commercial business profitable enough to fund our increasingly broader advanced clinical development programs. We are currently testing molecules from our portfolio of proprietary selective cortisol modulators in two Phase 3 Cushing’s syndrome trials; one Phase 3, one Phase 2, and two Phase 1b oncology trials; and two CNGB3 Phase 2 trials in metabolic disorders. These trials will generate important data next year and into 2022 even as additional novel molecules are in development. I know of no other company our size that combines commercial success with such diverse and promising clinical activities. I want to emphasize these are difficult times for everyone. The COVID-19 pandemic has caused many individuals, including physicians and patients, to protect themselves from infection by limiting their exposure to other people. Patients are reluctant to leave their homes even to see their physician. Many medical practitioners have barred in-person visits by commercial representatives. This reduction in face-to-face interactions makes every aspect of medical care more difficult, especially for complex serious conditions such as Cushing’s syndrome. We are doing what we can to help. Our commercial team is providing ways to support physicians by video and teleconference. Physicians have increased their use of telemedicine and have adapted their in-office procedures to reduce the risk of infection. However, these measures are aimed at increasing face-to-face types of care. Diagnosing and treating patients with Cushing’s syndrome requires more direct interactions between patients and physicians. Nevertheless, patients who were using Korlym before the pandemic are highly motivated to continue to use it. Despite the current challenges, we continue to enroll new patients and add to our roster of Korlym subscribers, albeit at a moderate pace, due to limited effective treatment that’s greatly improved the lives of many patients with Cushing’s syndrome, a life-threatening chronic illness. Pandemic-related changes in medical practice and patient behavior have modestly reduced awareness this quarter, but the foundation of our business and effective medication promoted by a dedicated commercial team that can support a patient-focused approach have been rock solid, setting us up to benefit from growth once conditions improve. As I referred to on prior calls, there are many patients who could benefit from Korlym who have not yet received it. Our plan and success of Korlym are correlated and have the potential to benefit many more. The stock repurchase program we announced today reflects our Board’s confidence in the fundamental strength of our business. The most important use of our cash is to fully fund our commercial operations and our increasingly broad clinical development programs. As I mentioned, our stock repurchase program allows us to repurchase our stock when we think it’s undervalued, like it has been recently. As many of you know, we are evaluating relacorilant, our planned successor to Korlym for patients with Cushing’s syndrome in two Phase 3 trials. Relacorilant is a selective cortisol modulator. Like Korlym, it achieves its effect by competing with cortisol at the glucocorticoid receptor. Unlike Korlym, it does not bind with the progesterone receptor, which means it does not cause off-target effects, including termination of pregnancy, endometrial thickening, or vaginal bleeding caused by affinity to that receptor. By a different mechanism, relacorilant also does not appear to cause hypokalemia, low potassium, a serious side effect experienced by 44% of patients in Korlym's pivotal trial. Korlym-induced hypokalemia is a leading cause of discontinuation. Korlym’s Phase 2 clinical data was clinically positive. Patients experienced meaningful improvements in hypertension and glucose control as well as a variety of other signs and symptoms of Cushing's syndrome. There were no relacorilant-induced instances of endometrial thickening, vaginal bleeding, or drug-induced hypokalemia. Our poster presenting these results can be found at the Investors/Past Events tab of our website. We expect relacorilant's Phase 3 GRACE trial to serve as the basis for our NDA submission in Cushing's syndrome. We continue to enroll patients with any etiology of Cushing's syndrome, although the pace has slowed due to the pandemic. We expect to submit our NDA in the second quarter of 2022. Last quarter, we dosed the first patient in relacorilant's second Phase 3 trial for patients with Cushing's syndrome, the GRADIENT trial. GRADIENT is specifically studying relacorilant's effects in patients whose Cushing's syndrome is caused by adrenal adenoma or adrenal hyperplasia. Patients with this etiology of Cushing's syndrome experience a less rapid decline, but ultimately, their health outcomes are poor. GRADIENT is the first controlled study in patients with this type of Cushing's syndrome. We expect these findings will contribute to the optimal treatment of these patients. Participants in GRADIENT will receive either relacorilant or placebo for 22 weeks. The primary endpoints are statistically significant improvement in hypertension or glucose metabolism, and all the other common manifestations of Cushing's syndrome will also be measured. Planned enrollment is 130 patients at sites in the United States and Europe. Many of the investigators who are participating in GRACE will also participate in GRADIENT. You can find our poster presentation of GRADIENT’s design at the Research and Pipeline/Other Patients tab on our website. Our oncology program has originated from theories developed by investigators at the University of Chicago more than 10 years ago and now consists of four clinical trials, two of which will produce data in the first half of next year. Our program is examining new mechanisms by which cortisol modulation may help treat patients with solid tumors. Cortisol suppresses apoptosis, the programmed cell death that chemotherapy is intended to induce. There are compelling preclinical interim data suggesting that relacorilant can help chemotherapy achieve its full potential by reversing cortisol's anti-apoptotic effect. We are testing this hypothesis in patients with metastatic ovarian cancer and metastatic pancreatic cancer. We initiated these trials following encouraging results from our Phase 1/2 trial of relacorilant combined with nab-paclitaxel, Celgene's drug Abraxane. Tumors in seven of 25 patients with metastatic pancreatic cancer and in five of 11 patients with platinum-resistant ovarian cancer either shrank or stopped growing for 16 weeks or longer. Two patients with metastatic pancreatic cancer exhibited tumor shrinkage for 65 weeks. All patients had experienced disease progression during multiple prior lines of chemotherapy, including the treatment of metastasis. We presented these results at ASCO in 2019. You can find our poster at the Research and Pipeline/Publications page on our website. In order to begin enrolling patients in RELIANT, we have enrolled 80 patients in a Phase 3 trial of relacorilant plus nab-paclitaxel for patients with metastatic pancreatic cancer. Each patient will receive relacorilant plus nab-paclitaxel, with the primary endpoint being subjective response rate with secondary endpoints including progression-free survival for the duration of response. We expect to conduct an analysis of results from RELIANT’s first 40 patients in the first half of 2021. The expected response rate of nab-paclitaxel monotherapy in patients with metastatic pancreatic cancer is zero. We believe sufficiently positive results in RELIANT would support accelerated approval. In July, we completed enrollment in our controlled Phase 2 trial in patients with advanced ovarian cancer. 178 patients were randomized to receive nab-paclitaxel, either continuous dosing of relacorilant, intermittent dosing of relacorilant, or placebo. The primary endpoint is progression-free survival, with secondary endpoints including objective response rate for the duration of response. We expect results of the study in the first half of next year. Cortisol activates and reduces inflammation and suppresses the immune system, which is why synthetic cortisol is used to treat autoimmune and inflammatory disorders such as rheumatoid arthritis, inflammatory bowel disease, and multiple sclerosis. Importantly, by suppressing the immune system, cortisol also diminishes the effectiveness of immunotherapy in treating patients with solid tumors. In September, we initiated an open-label Phase I-b trial of relacorilant combined with the PD-1 checkpoint inhibitor, pembrolizumab, Merck’s drug KEYTRUDA, in patients with advanced adrenal cancer and tumors that produce excess cortisol. These patients with severely affected adrenal cancer can have Cushing’s syndrome, a very challenging combination. We believe that excess cortisol may also interact and counteract the intended effect of pembrolizumab, which is rarely effective as monotherapy in these patients. By evaluating relacorilant, we aim to treat these patients with Cushing’s syndrome by reducing the effects of excess cortisol activity, allowing pembrolizumab to achieve its full cancer-killing effect. Our posters at this year’s ASCO and AACR meetings present preclinical and clinical biomarker data supporting our hypothesis. You can review them at the Research and Pipeline/Publications tab of our website. We plan to enroll 20 patients in this trial at five sites in the United States. The primary endpoint is objective response rate, with secondary endpoints including progression-free survival for the duration of response. Investigators at the University of Chicago have shown that cortisol stimulates tumor growth in patients with castration-resistant prostate cancer. This finding has been confirmed by researchers at Memorial Sloan Kettering Cancer Center. Before we explain why patients treated with widely prescribed androgen receptor antagonists can become resistant, the price of androgen stimulation, tumors often utilize cortisol as a growth pathway. Our hypothesis is that adding a cortisol modulator in androgen deprivation therapy could improve outcomes. We’re conducting a Phase I-b trial of our selected cortisol modulator exicorilant, combined with enzalutamide in patients with castration-resistant prostate cancer, and expect to identify the dose regimens suitable for advancing to a wider controlled study in the first quarter of 2021. I’ll conclude with an update on our programs in metabolic diseases. In the United States, 6 million people are prescribed medications such as olanzapine; Eli Lilly's drug Zyprexa, and Risperdal, J&J’s Risperdal, for treatment of conditions such as schizophrenia, bipolar disorder, and major depression. While these drugs are very effective, they have severe side effects in the form of rapid and sustained weight gain, cardiovascular disease, and other metabolic disorders. Each of the patients can gain 50 pounds, and their life expectancy decreases by an average of 20 years, partly due to excess cardiovascular events such as heart attacks and strokes. We have completed three double-blind, placebo-controlled clinical trials in healthy subjects showing that our cortisol modulator reduces dangerous metabolic adverse effects. Two of these trials have been published. Our positive results were published in the Journal of Advanced Therapy and Obesity in 2009 and 2010. Unfortunately, Korlym, which has the active ingredient in the abortion pill, cannot be advanced for such a prevalent disorder. Miricorilant, by contrast, is not the abortion pill and can be advanced for this use. Last quarter, we completed a trial in which healthy subjects received olanzapine with either 600 milligrams of miricorilant, 900 milligrams of miricorilant, or placebo for 14 days. Study participants who received miricorilant gained significantly less weight than those who received placebo. In addition, they exhibited a smaller increase in triglycerides and liver enzymes AST and ALT, markers of liver damage that arise at the onset of olanzapine therapy. We plan to publish the full results of this study next year. We’re currently conducting two double-blind placebo-controlled Phase 2 trials of miricorilant in patients with schizophrenia. The first, GRATITUDE, is evaluating miricorilant in reversing recent antipsychotic-induced weight gain. 100 patients will receive, in addition to their established dose of antipsychotic medication, either 600 milligrams of miricorilant or placebo for 12 weeks. GRATITUDE is being conducted at approximately 20 centers across the United States. During the third quarter, we initiated GRATITUDE 2, the randomized double-blind placebo-controlled Phase 2 trial of miricorilant to treat long-standing antipsychotic-induced weight gain. 150 patients with schizophrenia will continue to receive their established dose of antipsychotic medication plus either 600 milligrams, 900 milligrams of miricorilant, or placebo for 26 weeks. The primary endpoint is reduction in body weight. GRATITUDE 2 will be conducted at 35 centers in the United States. In animal models, miricorilant also prevents and reverses fatty liver and liver fibrosis, precursors of non-alcoholic steatohepatitis or NASH, a serious liver disorder that affects millions of patients. Later this month, we plan to start a 120-patient, double-blind placebo-controlled Phase 2 trial of miricorilant in patients with NASH. Corcept’s third quarter results reflect the pandemic-related public health measures and related changes in physician and patient behavior. That being said, our commercial business is remarkably stable and is poised to resume its growth once the pandemic subsides. We expect to finish the year within the balance of our regional pre-pandemic revenue guidance to be now in the range of $355 million to $365 million. Our cash and investments grew by $34.7 million to $442.2 million. We announced a program to repurchase up to $200 million of our common stock. Our clinical program continues to broaden and will produce significant data in 2021 to 2022. Enrollment is underway in two Phase 3 trials of relacorilant, our planned successor in Cushing’s syndrome. We expect the GRACE trial to provide the basis for our NDA submission in the second quarter of 2022. Our second trial, GRADIENT, is evaluating relacorilant in patients with Cushing’s syndrome with adrenal issues. We’re confident we will help physicians better understand treatments available for various causes of Cushing's syndrome. Data from the first 40 patients in our Phase 2 RELIANT trial of relacorilant plus nab-paclitaxel in patients with metastatic pancreatic cancer will be available in the first half of next year. Sufficiently positive results from RELIANT will likely qualify relacorilant for accelerated approval. Our controlled Phase 2 trial of relacorilant plus nab-paclitaxel in patients with metastatic ovarian cancer will also produce results in the first half of 2021. Last month, we initiated a 20-patient, open-label Phase I-b trial of relacorilant combined with the PD-1 checkpoint inhibitor pembrolizumab to treat patients with advanced adrenal cancer and cortisol excess. Finally, in the first quarter of next year, we expect to select the optimum dose of exicorilant for advancement in combination with enzalutamide in a controlled Phase 2 trial in patients with castration-resistant prostate cancer. Our program in metabolic diseases has also made significant gains. Enrollment and site activation continue with GRATITUDE, our double-blind placebo-controlled Phase 2 trial of miricorilant to reduce recent antipsychotic-induced weight gain. We have been actively developing enrollment in GRATITUDE 2, a double-blind, placebo-controlled Phase 2 trial miricorilant in patients with long-standing antipsychotic-induced weight gain. We expect to start a double-blind, placebo-controlled Phase 2 trial of miricorilant in patients with NASH later this month. I’ll stop here for questions.

Operator, Operator

Thank you. At this time, our first question will come from Tazeen Ahmad of Bank of America.

Tazeen Ahmad, Analyst

Good afternoon. Thanks for taking my questions. A couple for me. So, if you end up winning the PGR, and let's say, also the district court case, and you have no competition for Korlym for several years. And you also plan on launching relacorilant in Cushing’s, how do you think that both of those drugs could co-exist? Is there a subset of the population that might be better served with one drug over the other? Or is it your view that over time, sales for Korlym would fade off as more people pick up relacorilant?

Charlie Robb, CFO

Thank you, Tazeen. This is Charlie. I'll answer the first part of the question regarding the two drugs. I just want to clarify that if we are successful with our patent, we would be looking at relacorilant protection until 2037. So, that’s a long time, and we could establish a strong market presence. Additionally, I want to make it clear that if we have that kind of legal success, the long-term strategy for both drugs will be defined. But regarding the coexistence of both, we believe there will be distinct patient segments that may prefer one over the other.

Joseph Belanoff, CEO

Thanks for the questions, Tazeen. It seems straightforward to say that relacorilant is a clearly superior medication to Korlym, provided the evidence supports that. My expectation is that over time, relacorilant would replace Korlym as the first-choice drug because it seems likely to offer better safety and efficacy overall.

Tazeen Ahmad, Analyst

Okay, and do you think that would happen immediately or would that be more of a gradual switch over?

Joseph Belanoff, CEO

It’s a little hard to say, but my expectation is that it would be sooner rather than later.

Tazeen Ahmad, Analyst

Okay, thank you. And then maybe one question on your pipeline program for NASH; it seems like there are many mechanisms being explored by different companies. How do you think your approach could be differentiated either in terms of efficacy or safety in that population? Thanks.

Joseph Belanoff, CEO

Tazeen, thank you for the question. Our Chief Medical Officer, Andreas Grauer, can take that question.

Andreas Grauer, CMO

Tazeen, thank you for your question. We want to see patients treated with Korlym to measure their outcomes. While we may not have specific NASH data yet, we do find that our approaches have led to improvements. Our pre-clinical testing aligns with what we are aiming to achieve in clinical studies.

Tazeen Ahmad, Analyst

Okay. And do you have a sense of when we would be able to see data from that program?

Andreas Grauer, CMO

I think we're just getting started. We're hoping to start screening in 2021, and we're aiming to have data in 2021.

Tazeen Ahmad, Analyst

Okay. Great. Thank you for the questions.

Operator, Operator

And we’ll move to the next question from Matt Kaplan of Ladenburg Thalmann.

Matt Kaplan, Analyst

Hi. Good afternoon, guys, and thanks for taking the questions. Just a few questions regarding the impact of the COVID-19 pandemic on the progress of the GRACE study and the GRADIENT study as well. What are you seeing there in terms of challenges?

Joseph Belanoff, CEO

Yes. It’s a little bit choppy, so I hope you are asking about the ongoing Korlym or GRACE study.

Matt Kaplan, Analyst

No, in terms of the ongoing GRACE study and GRADIENT studies, the impact of COVID-19 on those programs?

Joseph Belanoff, CEO

As far as the COVID pandemic, it’s tough for everyone, but we are still working on our programs despite the difficulties brought about by the pandemic.

Charlie Robb, CFO

I’ll just remind everyone that during the early pandemic, we did extend our timeline, and while it's affected progress, we have not changed our targets significantly since that time.

Matt Kaplan, Analyst

Okay. That’s helpful. Thanks. And then in terms of – I guess maybe a question for Charlie, you mentioned a best-case scenario for 2037 if everything goes in your favor with the litigation with Teva and Sun. Can you help us bracket that and give us an understanding of a base case scenario, in terms of how things could progress, and the other end of that spectrum, when we could potentially see generic competition, given the current situation?

Charlie Robb, CFO

Yes. The 2037 data I mentioned is based on our longest running patent and the ongoing PGR. We are feeling good about our position right now. It's challenging, but we have a lot of data on our patents to work with, so it's tough to provide concrete predictions on timelines.

Matt Kaplan, Analyst

Okay. That’s helpful. Thanks. And then just in terms of a pipeline question if I may. The RELIANT Phase 3 study, you mentioned that data from the first 40 patients would be available in the first half of the study, and I was wondering what the primary endpoint is with respect to the objective response rate?

Joseph Belanoff, CEO

In the interim analysis, we will conduct a first look at the response rates we track, looking for early indicators of success. The pacing is different, but we're actively monitoring all outcomes.

Matt Kaplan, Analyst

Thank you very much and congrats on the progress.

Operator, Operator

And we’ll go to our next question from Roger Song of Jefferies.

Roger Song, Analyst

Great. Thank you. Good afternoon, and thank you for taking my question. My first question goes into the Cushing's syndrome franchise; we see both of the potential new steroidogenesis inhibitors are guiding 300 million to 400 million for Cushing’s syndrome, given that Korlym is realizing this kind of range. How do you reconcile this with your expectations for your Cushing’s syndrome franchise?

Joseph Belanoff, CEO

I apologize for that; could you clarify your question a bit more? I didn’t catch everything you said.

Roger Song, Analyst

Sure. So, given that you have two new steroidogenesis inhibitors potentially guiding toward 300 million to 400 million for Cushing’s syndrome, how do you see the competitive landscape affecting your expectations for the current Korlym franchise?

Sean Maduck, CCO

Roger, this is Sean Maduck, Chief Commercial Officer. Specifically, I would say right now, we’ve been able to retain minimal impact from this competitive landscape. Our medication has a mechanism of action that is different from the cheaper medications sometimes used off-label to treat Cushing’s disease. It's crucial to remember the distinct spectrum of Cushing’s syndrome and the specific patient needs that Korlym addresses.

Roger Song, Analyst

Okay, got it. Thank you. Maybe next question for the Exicorilant, so we see that you're going to select the dosing next quarter – the first quarter of next year. I'm just curious about what needs to be done to select those doses?

Joseph Belanoff, CEO

We are currently progressing with our Phase 1/3 trial, which will lead us through the year to a definitive conclusion about those doses. This trial is taking longer than anticipated due to the complexities we’ve uncovered.

Roger Song, Analyst

Got it, okay. That’s fair. Okay, great. Thank you. That’s all my questions. Thanks for the explanation.

Joseph Belanoff, CEO

Thanks, Roger.

Charlie Robb, CFO

Thank you, Roger.

Operator, Operator

And we’ll move to the next question from Swayampakula Ramakanth of H.C. Wainwright.

Swayampakula Ramakanth, Analyst

Thank you. I just want to check and see if you can hear my voice clearly, because I’ve been having a very choppy evening.

Joseph Belanoff, CEO

Yes, we can hear you.

Charlie Robb, CFO

Yes, we can.

Swayampakula Ramakanth, Analyst

Okay, so I’m trying to understand the third quarter, the revenue run and also trying to understand the guidance you put out. Based on your guidance; if I take the midpoint, you’re expecting approximately about 6% growth from the third quarter base. So, just trying to understand your confidence for that number and is there a possibility to do closer to your previous guidance at the upper end?

Charlie Robb, CFO

Before I start, I didn't get a chance to introduce Sean. Sean Maduck is our Chief Commercial Officer, and I'll let him answer that question.

Sean Maduck, CCO

Yes, thanks for the question. I’ll break it down into three parts. First, I want to discuss what happened during the pandemic and then we’ll look at expectations for Q4. There are two key drivers for our revenue: patient retention and unique patient acquisition. During this COVID window, our inpatients have done well, but new patient acquisition has been challenging. There are key factors impacting us over the last six months: physicians have moved to a hybrid model of in-person and telemedicine visits, which have reduced patient screening and diagnosis rates, impacting the ability to get patients to treatment. Secondly, even when patients can visit physicians or labs, they have been reluctant due to pre-existing health conditions. Finally, many practices have restricted pharmaceutical sales representatives from entering their offices, which affects our clinical ability to educate potential prescribers. So, in terms of Q4, it takes time for a patient to be diagnosed and treated, and those timelines are complicated due to pandemic-related slowdowns. We're actively seeking new methods to address this and improve interactions.

Swayampakula Ramakanth, Analyst

Thank you for that. As for the pancreatic cancer trial, I understand from your initial comments that you have data from the first 40 patients in the fourth quarter of 2021. Could you provide an idea of when the study might be completed? If the data is positive, will it be sufficient for approval, or do you need additional studies?

Joseph Belanoff, CEO

Sure, we expect to provide interim analysis from the first 40 patients in the first half of 2021. However, the full enrollment of the study requires an additional 80 patients, so completion of the trial would take longer. If we have compelling results, it certainly could move us towards an NDA submission.

Swayampakula Ramakanth, Analyst

Okay, thank you, gentlemen. Thanks for taking the questions.

Operator, Operator

And we’ll go to Alan Leong of BioWatch News.

Alan Leong, Analyst

Hi, Joe. Hi, Charlie. Good evening to Andreas and Sean. I appreciate that it’s Election Day, so I won’t ask you if you voted and who for.

Joseph Belanoff, CEO

Yes. Yes.

Alan Leong, Analyst

Let me ask you something about the GRATITUDE trial. You briefly discussed this about six months ago. Which of the GRATITUDE trials has a more difficult enrollment proposition among investigators? Could you comment on how the trial enrollment execution is going for both GRATITUDE I and GRATITUDE II?

Andreas Grauer, CMO

Yes, thank you for the question. The GRATITUDE I trial is focused on recently weight-gained patients compared to GRATITUDE II, which addresses long-standing weight gain and has proven difficult for enrollment. We believe both trials will yield results around the same time in Q2 2022, and GRATITUDE I is powered to detect a 5% reduction in weight.

Joseph Belanoff, CEO

Andreas, I'd like to add that compared to our healthy volunteer trials, the key difference here is that patients in these studies may couple their treatment differently, which can influence outcomes.

Alan Leong, Analyst

Got it. Let me ask you about the adrenal cancer trial for a broader view. It’s exciting that you’re initiating trials in different regions. How does this align with your expansion plans for the Cushing’s program?

Joseph Belanoff, CEO

Alan, I’m not entirely clear on your question. What I can tell you is that Cushing's syndrome includes various nuances, including patients with adrenal cancer. We’ve noted that our treatment improves Cushing's symptoms significantly, but we haven’t seen it negatively impact cancer outcomes.

Alan Leong, Analyst

I understand. One last question on CORT113176 in Phase 1. How is the trial going, and when might we see the results presented?

Joseph Belanoff, CEO

CORT113176 is in early development and still in Phase 1. We are excited about its potential, especially regarding neurodegenerative diseases. We’re focused on establishing its viability for patient care, but we're not at the stage yet to share detailed timelines.

Alan Leong, Analyst

Thank you. I appreciate your time.

Joseph Belanoff, CEO

Thank you all for joining us today, and we look forward to speaking with you again next quarter.

Operator, Operator

This does conclude the call; we would like to thank everyone for your participation. You may now disconnect.