CORT Plummets 48.8% After FDA Rejects Key Drug Application—What’s Next for Corcept?

Summary
• Corcept Therapeutics (CORT) slumps 48.8% intraday, trading at $35.95 amid a $32.99–$39.0 range
• FDA issues Complete Response Letter for relacorilant, halting approval path for Cushing’s Syndrome
• Options volatility surges, with 2026-01-16 $35 put options seeing 620% price jump

Corcept Therapeutics faces a seismic shift as its flagship drug candidate, relacorilant, hits a regulatory wall. The FDA’s rejection of the New Drug Application for Cushing’s Syndrome has triggered a near-50% selloff, testing critical support levels and reshaping investor sentiment. With the stock trading at a 52-week low of $32.99, the market is recalibrating expectations for the biopharma giant’s near-term prospects.

FDA’s CRL Sparks Market Panic
The U.S. Food and Drug Administration’s Complete Response Letter for relacorilant—a glucocorticoid receptor antagonist targeting Cushing’s Syndrome—has shattered investor optimism. Despite meeting primary endpoints in the GRACE trial and showing robust safety data, the FDA demanded additional evidence of efficacy, citing an unresolved benefit-risk profile. This regulatory setback has triggered a liquidity crunch, with the stock plummeting from $70.195 to $35.945 in a single session. CEO Joseph Belanoff’s acknowledgment of disappointment and plans to engage with the FDA signal a prolonged regulatory battle, compounding uncertainty for shareholders.

Pharma Sector Mixed as CORT Underperforms
While the broader pharmaceutical sector remains resilient—with Johnson & Johnson (JNJ) up 0.21%—Corcept’s collapse highlights the sector’s vulnerability to regulatory risks. Recent sector news, including Jazz Pharmaceuticals’ Zepzelca approval and Pfizer’s pricing deal, underscores the contrast between blockbuster launches and stalled pipelines. CORT’s 48.8% drop, however, underscores the high-stakes nature of drug approvals, particularly for smaller biotechs reliant on single-product success.

Options Playbook: Capitalizing on Volatility and Technical Breakdowns
• 200-day MA: $74.04 (far above current price)
• RSI: 31.65 (oversold territory)
• MACD: -0.24 (bearish divergence)
• Bollinger Bands: $75.51–$90.60 (price at lower bound)

Corcept’s technicals paint a grim picture. The stock is trading below all major moving averages and has breached the 52-week low of $32.99. Short-term bearish momentum is reinforced by the MACD histogram’s -1.36 and RSI’s 31.65, suggesting further downside. However, the 52W range of $32.99–$117.33 implies potential for a rebound if the stock holds above $32.99.

Top Options Plays:
• CORT20260116P35
- Type: Put
- Strike: $35
- Expiry: 2026-01-16
- IV: 63.70% (elevated volatility)
- Leverage: 19.54% (high gearing)
- Delta: -0.452 (moderate sensitivity)
- Theta: -0.013 (slow time decay)
- Gamma: 0.0819 (high sensitivity to price swings)
- Turnover: $242,154 (liquid)
- Why it stands out: This put option offers asymmetric upside if the stock gaps lower post-FDA engagement. A 5% downside to $34.15 would yield a 620% payoff (max(0, $35 - $34.15) = $0.85).

• CORT20260220P35
- Type: Put
- Strike: $35
- Expiry: 2026-02-20
- IV: 61.62% (moderate)
- Leverage: 11.53% (balanced)
- Delta: -0.435 (moderate)
- Theta: -0.016 (slow decay)
- Gamma: 0.0481 (responsive to price shifts)
- Turnover: $1.7M (high liquidity)
- Why it stands out: This longer-dated put provides downside protection with lower time decay. A 5% move to $34.15 would generate a 391.94% payoff (max(0, $35 - $34.15) = $0.85).

Trading Setup: Aggressive short-sellers should target CORT20260116P35 for a 620% return if the stock breaks $35. Conservative investors may use CORT20260220P35 as a hedge against further declines. Watch for a rebound above $35.50 to invalidate the bearish case.

Backtest Corcept Therapeutics Stock Performance
The performance of CORT after a -49% intraday plunge from 2022 to now has shown positive returns, with the 3-Day win rate at 58.79%, the 10-Day win rate at 59.32%, and the 30-Day win rate at 67.19%. The maximum return during the backtest was 14.72%, indicating that while there was some volatility, CORT has shown the ability to recover from significant drops.

CORT at Crossroads—Regulatory Hurdles or Catalyst for Rebound?
Corcept’s 48.8% plunge has created a high-risk, high-reward scenario. While the FDA’s CRL casts a shadow over relacorilant’s approval timeline, the stock’s proximity to the 52-week low of $32.99 offers a potential entry point for contrarians. Technicals suggest a test of $32.99, but a rebound above $35.50 could reignite hope. Meanwhile, sector leader Johnson & Johnson (JNJ) remains stable at +0.21%, highlighting the disparity between large-cap resilience and biotech volatility. Investors should monitor the FDA’s next steps and consider the CORT20260116P35 put for a 620% payoff if the stock gaps lower. Act now: Short CORT20260116P35 for bearish exposure or buy the put as a hedge against further declines.