Good day and welcome to the Corcept Therapeutics Conference Call. Today's conference is being recorded. [Operator Instructions] And at this time, I would like to turn the conference over to Charlie Robb. Please go ahead sir.

Thank you. Good afternoon everyone. I am Corcept's Chief Financial Officer. Thank you all for joining us. Earlier today we issued a press release announcing our third quarter financial results and reviewing our clinical progress. Copy is available at Corcept.com. Complete financial 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 15, at 888-203-1112 from the United States and 719-457-0820 internationally. Passcode will be 7489528. Statements during this call other than statements of historical fact are forward-looking statements based on our plans and expectations and are subject to risks and uncertainties that might cause actual results to differ materially from those such statements express or implied. These risks and uncertainties include, but are not limited to our ability to generate sufficient revenue to fund our commercial operations and development programs. The protections afforded by Korlym's Orphan Drug designation and our intellectual property. The availability of competing treatments including generic versions of Korlym; our ability to obtain acceptable prices or adequate insurance coverage and reimbursement for Korlym; and the scientific regulatory management and financial risks related to the development of our product candidates. These and other risks are set forth in our SEC filings, which are available at our Web site and the SEC Web site. On this call, forward looking statements will include those concerning our 2018 revenue guidance and expected growth in 2019 and beyond. Our stock repurchase program, physician awareness of hypercortisolism and the selection of Korlym is the best of medical treatment for many patients. The timing cost and outcome of our lawsuit against Teva Pharmaceuticals USA, the clinical attributes of relacorilant; data from the dose finding portion of our Phase 1/2 study of relacorilant plus Abraxane; and the progress and…

Thank you, Charlie. Thank you everyone for joining us today. Last quarter Corcept made important progress. Our revenue increased as more physicians prescribed Korlym for the first time and experienced prescribers wrote second and third prescriptions. We expect growth to continue because there are so many patients we've yet to reach. As a reminder, at least 20,000 people in the United States have been diagnosed with Cushing’s syndrome. Three thousand new cases of Cushing’s syndrome are diagnosed each year. Half of these cases are cured by surgery, but that leaves at least 10,000 patients in need of medical therapy. Some of these patients have been treated with Korlym but there are many, many more that can benefit from it. Our success with Korlym allows us to fully develop -- to fully fund development of our proprietary selective cortisone modulators as treatments for a broad range of serious endocrine oncologic and metabolic disorders. At this moment, especially, no one should lose sight of the breadth of our development programs and the steady progress of our drug candidates. To help investors and patients follow Corcept's rapid evolution, we have completely overhauled our Web site corcept.com to make it a better resource for anyone interested in cortisone modulation and our development programs. These programs are the future of Corcept and the future is rapidly approaching. Relacorilant our planned successor to Korlym in Cushing’s syndrome has begun its Phase 3 trial. Before describing the trial, let me explain why relacorilant is such a promising compound. Like Korlym, we expect relacorilant on to be an effective treatment for patients with Cushing’s syndrome because the two drugs operate by the same well understood mechanism, modulating or turning down the excess cortisol activity that causes patients harm. Cortisone modulation is very effective and Korlym's phase 3 trial,…

[Operator Instructions] We have a question from Matt Kaplan.

Matt, please go ahead.

Thanks Joe. And congrats on the progress and thanks for all the added detail on the programs beyond what Korlym’s doing in the marketplace. Just wanted to focus first on Korlym just for a minute. Can you give us a little bit more color in terms of where you are with Teva and the litigation there? You mentioned, the recent refusal of the judge to dismiss the case, but what does that mean and what are the next steps here?

Yes. I'm very glad to pass that over to Charlie to answer the question.

Yes, Matt. This is Charlie Robb. So let me just give a very brief background for those who aren't completely up on the story. So I think everybody does know that Teva is seeking approval to market a generic version of Korlym following expiration of Korlym’s Orphan Drug Protection next -- in February of next year. We received notice of that back in February of this year and as part of the requirements of the Hatch-Waxman Act, Teva certified as part of that notice that their generic product would not infringe the two patents we had listed at that point in the FDA’s orange book. Now in March, we sued Teva alleging that they would indeed infringe those two patents. And what has been going on for the past seven months is Teva attempts to have our complaint dismissed. So on October 23 just last week, the judge ruled against Teva. So what does that mean? Well, most immediately it has -- Teva is now in a position for actually having to respond to our lawsuit, I imagine to deny our allegations and so forth. And the back and forth that's involved with that will occupy one or two months up towards the end of this year is just going to be spent with Teva answering our complaint and us responding to that. The other immediate implication of this is, under the terms of the Hatch-Waxman statute. Our lawsuit in March triggered a 30-month automatic stay of FDA approval of Teva’s generic product. Beginning in February of 2018, there's a 30-month stay, pending our litigation. And so are our victory against Teva and its motion to dismiss means that 30-month stay remains in effect and our lawsuit will proceed. So for the next month or two Teva will answer our…

Okay. That's very helpful. Thanks Charlie. And then just shifting gears now to relacorilant. Joe thank you for the detail on the Phase 3 study designed. Can help us understand in terms of the initial 22-week period, how many, what percentage of those patients do you expect to have sufficient meaningful benefit improvements to make it to the 12 week which we're all phase?

Thanks Matt. I think we understand the question. I'd just like to reintroduce you to Bob Fishman, who is our Chief Medical Officer, I think is really best able since he's been in that study every single day to answer that question. Go ahead Bob.

Hi Matt. It's Bob here. Thanks for your question. So the best indicator of that would be the preliminary results that we showed last time and you'll recall that across improvements in glucose control and improvements in hypertension using our Phase 3 responder criteria, it was about half or a bit more of the patients who showed meaningful clinical benefit and that that's essentially the assumption that we're making in our Phase 2 about our ability to accrue enough responders to move on to the randomized control phase.

And just with that in terms of – I’m sorry, I cut you off.

Go ahead, Matt. Please.

And then with the withdrawal phase, how durable do you expect the relacorilant effect to be after it's withdrawn and patients are switched to placebo?

It will depend on the indications. We have to keep in mind that one of the benefits of the drug that we expect is that patients Cushing's syndrome will improve in general. We are hopeful that they will lose weight. And so there will be -- if successful improvement across many elements in the specific timeline may be different. But, from our past experience with Korlym what we're confident about is that within the three months -- that the three-month window of the randomized withdrawal phase should be more than sufficient to observe if true a separation of the patients who stay on drug versus those who switch over to placebo.

Now let me give you a little context for that. It's now a long time ago, but in the pivotal study for Korlym, the FDA required at that point everyone to come up [medicine] [ph] at the end of the six-month study. And then if they chose to six weeks later enter into a extension study. And what we've found in that study was that relatively rapidly, in fact, there were some patients who after two weeks, and we knew this because we got complaints from their physicians that taking them off the medicine was unethical and they needed to restart it right away. Symptoms reemerged. So our experience with Korlym was that symptoms reemerged quickly and certainly within that six-week period that I discussed that was true with Korlym. And that really informs the timing of what we're doing with relacorilant.

Great. Thanks. Thanks a lot guys for taking the questions.

Next please.

Our next question comes from Adam Walsh.

Hey guys. Thanks so much for taking my questions. I have just a few here. First of all, on the relacorilant trial that you have previously talked about it taking maybe two years. But, I'm looking at clinicaltrials.gov and it says estimated primary completion date of January 2020. And then a study completion date of January 2021. Can you just true-up the two year guidance with what I'm seeing here and what the differences would be?

That sounds like about two years.

No. I totally get that, but the prime estimate of primary completion date is January 2020. I assume that you had some input into the primary completion date. What is the difference between those two, in other words, the two years, it sounds like is 2020, but the 2021 date. I'm just -- I'm sorry that two years is 2021, but the 2020 date. I'm just trying to true that up with the two years of guidance, will that 2020 data point be meaningful, the primary completion. I'm sorry I didn't mean to pull up clinicaltrials.gov and stump you guys. But I'm just curious to hear the two year guidance is picked sooner that the data could -- my question is, could the data come sooner than two years?

I understand the impetus of your question. No. The answer is, it's a two year study soup to nuts and January 2021 is about correct.

Okay, perfect. And then, obviously an exciting development program with 335 in the antipsychotic induced weight gain in the NASH. And you talked about planning to start the study in the first quarter of 2019. When could we see initial data flow from that project?

I suspect that that's going to come in parts and we'll really roll out exactly what those studies are going forward. I don't think you should really expect anything before the --really the very end of next year. Those studies are basically and we haven't actually spoken to exactly the design of the studies, but they're going to -- it's going to be roughly a year maybe a little less with the quickest one before they produce any results.

Okay. That's helpful. And then, Joe, you mentioned that you're optimizing formulation for 335. What does that mean and how does -- how should we think about that?

I think one of the really critical things for us, 118335 is a very interesting molecule for very, very big disorders. And we really thought that this was the moment in time, we have a decent formulation, but we really thought that this is a molecule that has legs and rather than have that be an issue later in the development program, we wanted to pause for a little bit to see if we could really optimize it at this point in time and expect to and as I said planning to begin the study for Phase 2 studies early next year.

Okay. That's perfect. And then, finally, just I get this question from investors sometime. I mean you did a Korlym guidance last quarter, how confident are you in your ability to kind of predict forward-looking Korlym sales and that's it. Thank you guys.

Thanks very much Adam. I'd like to just because we really -- all of our teams very important this might be good for -- place in the call to reintroduce you to Sean Maduck, who runs all of our Cushing's syndrome franchise and [cort] [ph] and Korlym and beyond. And he is really responsible for all of our commercial activities. So Adam, if you just allow me to bring Sean onto the call, he will give you that information and maybe some others that you find useful.

Adam thanks for the question on forecasting of sort of future revenues. Before I answer that, I thought I'd take a minute to give a high level overview to everybody on the call of our commercial business. In doing so, there's really three key points, I want everybody to focus on. Number one, Korlym is being prescribed by physicians throughout the country for all ideologies of Cushing's syndrome both in academic centers and then in the community. Number two, we continue to add new prescribers every quarter and both our prescriber base and our patient base are growing. And the third important point is that, we continue to experience very favorable insurance reimbursement. So now diving into each of these specifically in terms of our prescribing as everybody may remember discussed this on previous calls. We have six sales regions that are comprised of 40 clinical specialists that are evenly distributed across the country in those regions. Since our Korlym launch in 2012, we have actually had over 1,200 healthcare providers writing one or more prescriptions for Korlym. And over that time, no region has accounted for more than approximately 20% of our unique prescriber base. Our enrollment activity has experienced a very similar distribution to that with no single region accounting for, again, more than approximately 20% of patient enrollments. And in fact, there have been patient enrollments for Korlym in all but two states in the country. So let's sum it up and we have a very healthy business and our patient population is very dispersed. We believe that hypercortisolism patients who could benefit from treatment exist in every single endocrinology practice. So moving on to our growing prescriber and patient bases. Again, as I stated on previous calls this is a highly scientific cell. I mean we…

Sean. Thank you so much. It's really helpful. I appreciate the color.

Welcome.

Thanks Adam.

The next question comes from David Buck.

Yes. Hi, good afternoon, Joe. Just a couple of questions. First, maybe Joe or maybe Sean, can you talk a little bit about what the trend has been in terms of those for patient any changes there throughout the year. And has there been any kind of mix shift that's led to some of the fluctuation in in revenues over the last couple of quarters. And separately for Charlie. Can you just talk about when you see potentially the additional patents in the FDA Orange Book, I believe there there's an additional -- currently four patterns in the FDA Orange Book, when you see the remaining patents after the litigation? And then just for Joe, can you talk a little bit more about how you expect to get a sense of differentiation of relacorilant as you move into Phase 3 from Korlym itself. You mentioned hypoglycemia, you mentioned, obviously not having the PR receptor, but anything else you'd like to see elucidate and pay for it? Thanks.

Let me just sort out this questions. The first question is dose changing, the answer is no not really. I mean we think that modestly over time it will go up a little bit just as the market more -- as the patient base matures only in the sense that -- the average dose is always affected by how many new patients are coming on and at some point in time patients on medicine will greatly outnumber those who are coming on at the beginning of each month. But the simple answer to your question is no, dose is not really changing in any serious way. Maybe a few milligrams up or down usually up but that's not really a factor. The second clinical question. Yes, you've really picked out the important things. I mean relacorilant has selected cortisol modulator unlike Korlym and it does not touch the progesterone receptor. That's a huge deal not just medically, but politically and in terms of distribution and so forth. So that's a very big thing. Now that was of course completely anticipated. I mean we could tell pre-clinically that this molecule and our other selected modulators don't touch the progesterone receptor. And of course, that turned out to be -- that that was no surprise that turned out to be true and of course our Phase 1 and Phase 2 studies. The interesting thing was that we noticed that early on we actually had made just a little bit of a comment at Phase 1, but it is clear to us now that relacorilant does not block the feedback mechanism [BHP] [ph] access to the degree that Korlym does, or cortisol doesn't rise as much and cortisol rise which you can deal with in terms of the glucocorticoid receptor essentially for some patients floods the mineral glucocorticoid receptor and causes hypokalemia. And to-date we haven't seen anything really in terms of hypokalemia that's associated with the medicine. That's a very, again not as sexy as taking away the abortion pill status but medically a very important thing because that's a side effect that really has to be managed and it's quite common. It is manageable. But for many physicians new to the drug they don't really are and is quite attentive to what their patients may fall off the medicine. So that's actually -- if it pans out a very large differentiating factor in addition to the lack of progesterone antagonism. And I'll leave the last question, the patent question to Charlie.

Yes. Hi, David. Well, I can give you one bit of information, which is we've had in this public information that we've had our patent allowed for the differential diagnosis and treatment with mifepristone of patients with ectopic Cushing's syndrome, which is a precise piece of the business. So those -- claims have been allowed the patent will issue as soon as the administrative we'll finish sharing at the patent office and that will be added to the Orange Book. With respect to our other applications both of those that have been published and are publicly known and those that have not been I really can't say anything as they're allowed, we'll let folks know about them and we will add them to the lawsuit as we think best. And I really can't comment beyond that.

The only thing I wanted to add to that David is just you probably already understand this, but just for the general audience as a whole, the way it works is there are patents which you can now see because they are published. There are also patents that you cannot see their application because they've yet to be published. And I can tell you that those are certainly in that category. I mean this is an area that we obviously have really studied for a long period of time, we think we've made important discoveries. And so in some sense there is a conveyor belt of intellectual property that's operating right now. And just to reiterate what Charlie said you'll see them as they come along.

Great. Thanks very much. And just I guess to wrap that part of the comment about complexity of litigation because something we'll see.

Yes. I think I sometimes joke a little bit about it. I mean the one thing I've learned this is my end of one of dealing with this kind of litigation is that, it is expensive and protracted and fortunately we have the money to pay for.

All right. Thank you.

Okay. Next question.

The next question comes from Alan Leong.

Thank you, Alan.

Congratulations on the clinical progress and my greetings to the team. I also saw the public listing for the Cushing's pivotal trial and the target dose that 400 milligrams. And wondering, if you can just put a little more color on that. I mean I expect you saw nothing concerning at the higher doses, but was there any signals towards incremental efficacy or perhaps greater proportion of patients covered. I expect some patients there must be an amazing amount of excess cortisol. So feel free to provide some color on it.

Hi. This is Bob Fishman. Thanks so much for your question. Yes. A few comments. First of all, Alan, well done. Just to set it up, we'll look forward to presenting our data at the next endocrine session. But just some general themes, we were pleased to see that in our higher dose group there was evidence of greater response. We showed that to you last time. That's continued to be true. And among all of the patients, of course, we followed them individually very carefully and they were -- the outcomes included clear instances in which patients -- in which as patients escalated to the higher dose. There was evidence of additional benefit. So when you combine the evidence of response combined with the tolerability we're really pleased with the definition of the workable dose range that came out of Phase 2.

Bob, if I may ask a little bit maybe related to it, the ongoing testing with the new assay test. Is that relating well to disease activity is it coming out as you expected so far?

Referring to the FKBP5?

Oh, yes. On FKBP5…

On FKBP5 just as a reminder to everyone a marker of this signaling through it's part of the glucocorticoid receptor and appears to be a good index of its activity in the signaling. Going through and we have a clear validated assay and are collecting in all of our studies. The short answer is, we're continuing to collect those data to make to learn as much as we can about it. We're collecting the assay, in fact, in all of the studies and it will be an exploratory endpoint and that data is still accumulating and I think we'll have an update at the timing of the results of the study overall.

But to remind you, Alan. At the endocrine Society meeting we released the first data in patients, which I think was really very consequential and very interesting, which is that we had a study of patients who were first tested pre-surgically for Cushing's disease. And what we found first and again always nice to find out what you're hoping to. The patients with Cushing's syndrome indeed had very elevated levels of FKBP5 activity. And then, when they had successful surgery it normalized and that's public information that's out. So that was actually really the first information we had in patients not just a healthy subject giving prednisone that we thought would happen would actually happening. And that really spurred us to make sure not to segue with what Bob was saying that we are now testing that finding in every study we're doing including the oncology studies and metabolic studies in addition to the Cushing’s syndrome. So we're really developing a real body of information because I think that from a scientific point of view that is an important thing as we're working on in the entire company because I think that if it turns out to be correct, it's going to change the entire way that the disease is assayed.

Let me ask, one more quick question. Of course investigators have a full suite of early trials using three different drugs to treat prostate cancer in the lab and preclinical data saw some good stuff at the CORT125281. You now have a new trial or relacorilant, was that covering the basis or is the solid tumors trials continuing to give a green light. I guess if you can provide some color on the motivation for putting a full suite of trials on to the prostate cancer?

Well, I have a simple answer and then I'll give you a more complicated answer. The simple answer is, there is a tremendous amount of interest in testing each of these compounds because pre-clinically they all look very good and in modest ways. But I think the more interesting answer and I think maybe if all the things we're working on our oncology, one where the scientific story is best understood is castration resistant prostate cancer. It's very clear that we have in the world very nice medications to modulate androgen activity like enzalutamide. But unfortunately when enzalutamide is given within hours of it being given you will begin to develop colonies of cells for which androgen is no longer the growth factor cortisol is the growth factor. And there was a very good New England Journal editorial on this and so forth. So I think that there really just is a lot of interest in this mechanism. And fortunately, we were able to fund it. The study with Korlym is being funded by Michael Milken's Foundation and the Department of Defense. We are of course are doing our own study with CORT125281. And Korlym study in castrate resistant prostate cancer also was recently grant funded. So I think there's a lot of interest in the mechanism and that's how it came to be. Obviously, as we get data we will probably narrow what we're working on, but at this point it really gives us lots of information in an important field.

Thank you very much.

All of you out there for being so patient. We'll look forward to talking to you next quarter and hope you have a good evening. Thank you.

Thank you, ladies and gentlemen, this concludes the teleconference. You may now disconnect.