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Why is Corcept's Stock Up More Than 60% So Far This Year?

Shares of Corcept Therapeutics Incorporated CORT has soared 62.5% this year so far, massively outperforming the 5.6% increase registered by the Zacks classified Medical Drugs industry during this period. Here we analyze the factors that led to the rally.

Corcept’s only marketed drug, Korlym (mifepristone), is approved for the treatment of patients with Cushing's syndrome.

Corcept is striving to commercialize Korlym successfully by deploying medical liaisons and sales representatives. About 10–15 of every 1 million people are newly diagnosed with Cushing’s syndrome each year, which translates to more than 3,000 new patients annually in the U.S. Increased awareness among physicians and patients about the drug and expanded sales efforts should boost sales.

Meanwhile, Corcept is currently working on developing the drug for additional indications. It is conducting a phase I/II safety and efficacy study on Korlym in combination with Eisai Co., Ltd.’s anti-cancer drug Halaven for the treatment of Triple-Negative Breast Cancer (TNBC). Enrolment in the study is complete and the company announced encouraging data in December 2016.. We expect a successful label expansion of Korlym to boost the top line significantly, as the disease represents huge potential with as many as 40,000 women in the U.S. being diagnosed every year.

The University of Chicago is conducting a phase II study on Korlym, in combination with Pfizer’s PFE Xtandi, for the treatment of metastatic, castration-resistant prostate cancer. The institution also plans to conduct a phase II study on Korlym, in combination with Celgene’s CELG Abraxane, for the treatment of patients with TNBC.

Importantly, apart from Korlym, Corcept is also evaluating CORT125134 for Cushing’s syndrome and a range of solid tumors.. Early data on the candidate for Cushing’s syndrome has been quite promising. The company has begun dosing patients in a phase I/II study on CORT125134, in combination with Abraxane, for the treatment of a range of solid-tumor cancers. The possible target indications include triple-negative breast cancer, ovarian cancer, pancreatic cancer and sarcoma. The company expects open expansion cohorts by the end of 2017.

The company also has three promising preclinical candidates - CORT118335 (metabolic disorders), CORT122928 (alcohol withdrawal) and CORT125281 (castration-resistant prostate cancer, triple negative breast cancer, and ovarian cancer) which are expected to enter the clinic in 2017.

Also during the first quarter 2017 earnings release, the company raised its 2017 revenue guidance. The company now projects revenues to be in the range of $125 million to $135 million more than its prior expectation of $120 million to $130 million.

Zacks Rank

Corcept currently carries a Zacks Rank #3 (Hold). A better-ranked stock in health care sector includes VIVUS, Inc. VVUS, carrying a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

VIVUS’ loss per share estimates narrowed from 50 cents to 39 cents for 2017 over the last 60 days. The company delivered positive earnings surprises in all four trailing quarters, with an average beat of 233.69%. The share price of the company has increased 6.1% year to date.

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