Top-tier biotech stock Corcept Therapeutics (CORT) is flirting with a buy point after the U.S. Supreme Court overturned constitutional protection for abortion.
XCorcept makes Korlym, a treatment for a disease known as Cushing's syndrome. Patients with this disease have high levels of the hormone cortisol, causing weight gain, cognitive difficulties, depression, fatigue, high blood pressure and/or bone loss. They can also develop diabetes.
The same drug, produced under another name by different companies, is used in a combination with other drugs for abortion. The active ingredient in Korlym is mifepristone. In Cushing's patients, it blocks the body's ability to process cortisol. In pregnant women, it shuts down the body's receptor for progesterone, leading to a miscarriage.
And after the Supreme Court overturned Roe vs. Wade on Friday — giving the abortion decision to states — biotech stock Corcept surged roughly 5% as of Tuesday's close.
But it's unclear why Corcept shares have climbed since the company does not sell Korlym as an abortion drug. Other companies use the active ingredient in Korlym as an abortion drug.
Biotech Stock: Expensive Cushing's Drug
Privately held Danco Laboratories makes the branded version of mifepristone, dubbed Mifeprex. The drug is also available as a generic from GenBioPro, another private company. They are used in combination with another drug, misoprostol. Pfizer (PFE) makes brand name misoprostol, Cytotec. Misoprostol causes contractions.
The Food and Drug Administration first approved the combination in 2000. Sixteen years later, the agency updated the guidelines for its use, restricting the mifepristone and misoprostol regimen for medical abortions for up to 10 weeks of pregnancy.
According to the Guttmacher Institute, more than half of abortions in the U.S. today — 54% — are medication abortions. The U.S. passed that threshold in 2020.
Korlym is a much newer drug. The FDA approved it for a small group of Cushing's patients in 2012. Then, biotech stock Corcept traded below 5 per share. Today, shares are worth around 25. The stock has mostly trended higher since winning its Korlym approval.
Korlym is also much more expensive than its abortion-inducing counterpart. It goes for about $608 per pill, according to Drugs.com. It's a chronic medication for Cushing's patients. Mifeprex, the branded version for abortions, costs $97 per pill.
Highly Rated Stock
Korlym is currently Corcept's only approved drug. In the first quarter, the company reported $93.7 million in sales, growing 18% year over year. Analysts expect second-quarter sales to grow about 10% to $100.3 million.
Still, the biotech stock has run up six of the past seven trading days. Shares are flirting with a buy point at 25.78 out of a cup base, according to MarketSmith.com. But on today's stock market, Corcept stock sank 2.9% to 24.38.
Corcept is highly rated and ranks second in IBD's biotech stock industry group. It has a Composite Rating of 96 out of a total 99. This puts shares in the leading 4% of all stocks in terms of technical and fundamental measures.
Shares also have a strong Relative Strength Rating of 95, meaning the biotech stock ranks in the top 5% of all stocks in terms of 12-month performance, according to IBD Digital.
Follow Allison Gatlin on Twitter at @IBD_AGatlin.
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