Corcept Therapeutics Incorporated (CORT) Accused of Illicit Sales Practices
According to the complaint against the company’s officers and directors for breaches of fiduciary duty, mismanagement, corporate waste, and violations of the Securities Exchange Act of 1934, in 2012, Corcept Therapeutics Incorporated (CORT) launched its prescription medicine Korlym, which served as Corcept’s only revenue-generating product. Due to the limited population of potential Korlym users, Corcept’s officers and directors improperly paid doctors to prescribe Korlym for non-approved applications and disguised these bribes as speaking fees for its speakers bureau program. Then, on January 25, 2019, Corcept’s ruse was revealed when Southern Investigative Reporting Foundation published a report alleging that Corcpet paid doctors to prescribe Korlym for off-label uses. In addition to this wrongdoing, on February 5, 2019, Blue Orca Capital published a report alleging that the specialty pharmacy Corcept switched to for processing Korlym orders was actually an undisclosed related party that Corcept was using to artificially boost sales and hide losses. As result of these revelations, Corcept’s public statements appeared to be materially false and misleading, damaging the Company’s credibility. As a result, Corcept has been named a defendant in a securities class action lawsuit, opening the Company up to future damages.