Wednesday, November 15, 2006

Someone's Betting on Corcept

I just saw a brief headline that...

"Corcept Therapeutics announces $3 mln private equity financing Co announces that it has entered into a definitive agreement with certain accredited investors for the private placement of 3 mln shares of its common stock at a price of $1.00 per share. Pursuant to the agreement, the investors, who are led by Paperboy Ventures, have irrevocably committed to purchase the shares."

There are only three logical explanations:
1) These people are looking for a tax write-off when Corcept collapses due to the poor performance of its Corlux (mifepristone/RU-486) product in treating psychotic depression. When the FDA determined the drug is not approvable, they’ll drop a tax bracket or two.
2) These investors have been snowed by someone; they don't know what they're doing. They haven't read posts such as this, this, and this. They don't know that the efficacy of Corlux is nothing to write home about, as it appears to help little with depression and not particularly greatly with psychotic symptoms either.
3) They know something that I don't. Maybe the FDA, circa vagus nerve stimulation, is going to approve Corlux regardless of its actual efficacy.

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