Cytodyn (CYDY) Phase 2b/3 Trial Results Expected Any Day
Cytodyn Inc (OTCMKTS:CYDY), a late stage biotech drug designer, has already shipped a win for Wealthpress members from our first feature back in April this year. Billions have been invested straight into a huge selection of biotechs all competing to develop a cure or perhaps therapy for serious COVID-19 instances which result in death, and none have been successful. Except for Cytodyn, when early indications are established in the current trial now underway.
But right after a deep jump on the business’s monetary claims and SEC filings, a picture emerges of company control functioning having a “toxic lender” to direct seriously discounted shares to the lender frequently. An investment in Cytodyn is actually a strictly speculative bet on the part of mine, and if the anticipated upward price movement does not appear after results of the company’s stage 2b/3 trial for severe-to-critical COVID-19, I will exit the investment.
If the business’s drug does in fact reliably conserve lives in danger of severe-to-critical COVID19 patients, then a groundswell of investor support can force the company into completely new, higher-grade human relationships, which would allow for the redemption of elimination and debentures of reliance on fly-by-night financings for example those described below.
Cytodyn’s sole focus is creating treatments used on a monoclonal antibody known as “leronlimab”, technically described as “humanized IgG4, monoclonal antibody (mAb) to the C-C chemokine receptor type five (CCR5)”. This engineered antibody was obtained of Progenics Pharmaceuticals as “PRO 140”, a recently-acquired subsidiary of Lantheus Holdings Inc (NASDAQ:LNTH), again in 2012.
Total expense of acquisition amounts to ten dolars million and a 5 % net royalty on commercial sales.
The drug was acquired on its first promise as an HIV treatment, for which continued research as well as development by Cytodyn has highlighted the ability to reduce regular drug cocktails with myriad pills into a single monthly injection, in some cases, with 0 negative effects. To day, the FDA has denied Cytodyn’s Biologics License Application (BLA)
Since then, Cytodyn’s scientific team has found the antibody’s influence on the CCR5 receptor has incredibly positive therapeutic implications for everything out of certain stable tumours to NASH (Non alcoholic steatohepatitis), the liver function ailment that afflicts up to 12 % of the US population, and up to twenty six % globally.
But the real emergent also potentially transformational program for leronlimab, as stated at the start, (which is currently being branded as Vyrologix by Cytodyn), is made for the Acute Respiratory Distress Syndrome (ARDS) due to COVID 19 that precludes the Sequential Organ Failure wearing fatal situations of COVID infections.
Leronlimab apparently blocks the CCR5 receptor from over responding to the virus as well as launching the today household word “cytokine storm”. Some proportion of individuals apparently return from the brink following two treatments (and in a number of cases, 1 treatment) of leronlimab, still if intubated.
The company finished enrollment of a level 2b/3 trial on December fifteen to “evaluate the efficacy as well as safety of leronlimab for individuals with severe-to-critical COVID-19 indications is a two arm, randomized, double blind, placebo controlled, adaptive design and style multicenter study,” according to the company’s media release.
This trial phase concluded on January 12-ish, of course, if the results are good, this can make leronlimab a high therapy for ARDS.
Cytodyn Inc (OTCMKTS:CYDY)
Even though the vaccines which are presently spreading are certainly lending optimism for a normalization of modern culture by mid-2021, the surging global rates of illness suggest the immediate future is right now overwhelming health care systems across the world as more and more people require access to Intensive Care Unit hospitalization.
During my first job interview with Dr. Nader Pourhassan back contained March of 2020, his serious interest for the prospects of this drug’s effectiveness was apparent.
It was prior to the now raging next wave had gathered heavy steam, as well as he was then seeing patients which were getting leronlimab under the FDA’s Emergency Investigative New Drug exemption.
Within the time, nonetheless,, this little independent biotech with no significant funding and a decidedly unfortunate public listing on the naked short-sellers’ dream OTC marketplace was getting able to utilize for a listing on NASDAQ, along with the deck was stacked against it.
Full Disclosure: I own 10,000 shares at an average cost of $6.23
Even though the planet concentrates breathlessly on the optimism for a brand new vaccine to regain the community liberties of theirs, the 10-ish percentage of COVID infectees that descend into the cytokine storm-driven ARDS literally have their lives saved by this seemingly flexible drug. To them, a vaccine is practically pointless.
This drug has “blockbuster potential” authored all over it.
With 394 patients enrolled inside the Phase 2b/3 trial as of December 16, and initially data expected this week, a demonstrable consistency in the data will record the world’s interest in the most profound way. Short sellers may be swept apart (at least temporarily) as the business’s brand new share priced levels qualify it for NASDAQ listing.
Cytodyn management says it’s 700,000 doses prepared for sale now, with an extra 2.5 million purchased for each of 2021 plus 2022 in a manufacturing agreement with Samsung, as per its CEO.
really if leronlimab/PRO 140/Vyrologix is so great, how come the stock’s been stuck in sub-1dolar1 5 penny stock purgatory for so very long?
The speedy answer is “OTC”.
Apart from struggling with a share price under three dolars, the company hasn’t been able to meet and keep some other quantitative prerequisites, including good shareholders’ equity of at least five dolars million.
But in the NASDAQ community, there are non quantifiable behaviours by organizations that cause waiting times to NASDAQ listings. Overtly promotional communications are among these kinds of criteria which will never result in a refusal letter…nor a NASDAQ listing.
Most importantly, Cytodyn in addition has not been able to access capital under traditional ways, because of its being mentioned on the OTC, in addition to therefore un-attractive on that basis alone to white shoe firms.
Thus, they’ve been cut down to accepting shareholder-hostile OID debentures with ugly conversion terms that create a short-seller’s wet dream.
In November, they coppied 28.5 huge number of out of Streeterville Capital of that just $25 million was given to the company; $3.4 zillion would be the discount the Streeterville areas, and $100k is actually put aside to protect the costs. Streeterville is actually related with Illiad Research and Trading, that is controlled by John Fife of Chicago Ventures Inc. Iliad has been called a “legendary so called toxic lender”, by rival research tight Utopia Capital Research.
Cytodyn Inc (OTCMKTS:CYDY)
Under the phrases of the price, Cytodyn must pay back again $7.5 million a month. In case they do not have the cash, they spend inside stock; the majority of lately, within a sales cost of $3.40 a share.
These days consider if you’re an opportunistic low rent lender and you have got a certain 2.2 million shares coming your way in the earliest week of each month. Any cost above the sales expenditure is pure profit. Remember – this guy is not an investor; he is a lender.
He is not operating on the hope that Cytodyn stock might go parabolic in the event that leronlimab is deemed a remedy for ARDS; his business model is to limit risk and maximize upside through affordable transformation of share.
This is the quick seller’s wet dream I am speaking about. Not merely would be the lender enticed to go short, but any short-trading pail shop in town who could fog a mirror and read an EDGAR filing know that each month, like clockwork, there is going to be 2 million+ shares hitting the bid down to $3.40.
The SEC isn’t impressed, and on September 3, 2020, filed a criticism.
The Securities in addition to the Exchange Commission these days filed charges against John M. Fife of Companies and Chicago he controls for acquiring and marketing more than 21 billion shares of penny inventory without any registering to be a securities dealer using the SEC.
The SEC’s complaint, alleges that in between 2015 and 2020, Fife, and the companies of his, Chicago Venture Partners, L.P., Iliad Research and Trading, L.P., St. George Investments LLC, Tonaquint, Inc., and Typenex Co-Investment, LLC, frequently involved in the small business of buying convertible paperwork from penny stock issuers, transforming those notes into shares of stock at a major discount from the market price, and selling the newly issued shares to the marketplace at a substantial profit. The SEC alleges which Fife and the companies of his engaged in over 250 convertible transactions with around 135 issuers, sold more than twenty one billion newly issued penny stock shares to the industry, and obtained greater than sixty one dolars million in profits.
Streeterville Capital isn’t mentioned as an entity in the complaint. Which suggests that it was probably utilized by Cytodyn and Fife to stay away from detection by the SEC that this same scheme was being perpetrated on Cytodyn within the time of the complaint of its.
But that’s not the sole reason the stock can’t preserve some upward momentum.
The company has been selling inventory privately from ridiculously minimal prices, to the position where one wonders just that exactly are the lucky winners of what amounts to no cost millions of dollars?
In addition, beginning within the month of November 2020 and also for every one of the second five (five) calendar days thereafter, the Company is obligated to reduce the exceptional balance belonging to the Note by $7,500,000 per month (the “Debt Reduction Amount”). Payments the Company makes under the Prior Notes are going to be acknowledged toward the transaction of each month Debt Reduction Amount. The Debt Reduction Amount payments aren’t be subject to the fifteen % prepayment premium.
Likewise detracting from the business’s gloss is actually the propensity of managing for endlessly promotional communications with shareholders. During an investor webcast on January 5th, the company had a compilation of audio testimonials from patients making use of PRO 140 for HIV therapy, backed by tear-jerking music, and replete with emotional language devoid of information.
Worse, the company’s mobile phone number at the bottom level of press releases comes with an extension for Mike Mulholland, the CFO, and Nader Pourhassan, the CEO, but neither one is actually a “valid extension” in accordance with the automated phone system.
That is the type of approach that the FDA and SEC view unfavourably, and it is likely at minimum in part the reason for the continued underdog status of theirs at both agencies.
The company also has become unresponsive to requests for interview, and therefore with the story coming out under only these ill advised publicity stunts, shorts are attracted, and big cash investors, alienated.
But think of this particular “management discount” as the opportunity to get a sizable job (should someone be so inclined) in what may really well turn out to be, in a matter of weeks, as the leading therapy for severe COVID19 related illness.
I expect the details in the trial now concluded for just such an indication might release the organization into a whole new valuation altitude that will allow it to get over these shortfalls.
Average trading volume is actually constant above six million shares 1 day, and right before the tail end of this week, we’ll find out precisely how effective leronlimab/PRO 140/Vyrologix is actually at saving lives from the most severe of COVID nineteen. In case the results are good, this can be a huge winner.
Cytodyn Inc (OTCMKTS:CYDY)