Cytodyn (CYDY) Phase 2b/3 Trial Results Expected Any Day
Cytodyn Inc (OTCMKTS:CYDY), a late stage biotech drug designer, has already delivered a win for Wealthpress members from our first feature back in April this year. Billions have been invested into a huge selection of biotechs all competing to create a cure or therapy for severe COVID-19 instances that cause death, as well as none have been successful. Except for Cytodyn, when early indications are established in the current trial now underway.
But right after a serious plunge on the business’s monetary statements and SEC filings, an image emerges of company control working having a “toxic lender” to direct severely discounted shares to the lender regularly. An investment in Cytodyn is actually a purely speculative bet on my part, and when the expected upward price movement does not manifest following results of the company’s stage 2b/3 trial for severe-to-critical COVID-19, I will exit the investment.
In case the company’s drug does in fact reliably save lifestyles in danger of severe-to-critical COVID19 individuals, subsequently a groundswell of investor support could drive the organization into completely new, higher-grade relationships, which would permit for the redemption of elimination as well as debentures of reliance on fly-by-night financings for instance those described below.
Cytodyn’s sole focus is creating therapies based on a monoclonal antibody known as “leronlimab”, technically called “humanized IgG4, monoclonal antibody (mAb) to the C-C chemokine receptor sort five (CCR5)”. This engineered antibody was acquired from Progenics Pharmaceuticals as “PRO 140”, a recently acquired subsidiary of Lantheus Holdings Inc (NASDAQ:LNTH), back in 2012.
Total price of acquisition amounts to ten dolars million and a 5 % net royalty on commercial revenue.
The drug was acquired on its early promise as an HIV therapy, for which continued research as well as development by Cytodyn has shown the capability to reduce daily drug cocktails with assortment pills right into an individual monthly injection, sometimes, with 0 negative effects. To date, the FDA has denied Cytodyn’s Biologics License Application (BLA)
Since that time, Cytodyn’s scientific team has found the antibody’s effect on the CCR5 receptor has extremely positive therapeutic implications for everything out of certain solid tumours to NASH (Non alcoholic steatohepatitis), the liver feature condition which afflicts up to 12 % of the US public, and up to twenty six % globally.
But the real emergent also likely transformational application for leronlimab, as mentioned at the start, (which is now being branded as Vyrologix by Cytodyn), is for the Acute Respiratory Distress Syndrome (ARDS) caused by COVID-19 which precludes the Sequential Organ Failure in fatal cases of COVID infections.
Leronlimab evidently blocks the CCR5 receptor from over responding to the virus and also launching the today household word “cytokine storm”. Some proportion of patients evidently return from the brink after two treatments (and in some instances, 1 treatment) of leronlimab, still when intubated.
The company completed enrollment of a stage 2b/3 trial on December 15 to “evaluate the efficacy and safety of leronlimab for clients with severe-to-critical COVID 19 indications is a two arm, placebo controlled, double blind, randomized, adaptive design and style multicenter study,” based on the company’s press release.
This trial period concluded on January 12-ish, of course, if the outcomes are positive, this will make leronlimab a top remedy for ARDS.
Cytodyn Inc (OTCMKTS:CYDY)
Even though the vaccines which are currently spreading are surely lending hope for a normalization of modern society by mid 2021, the surging global rates of illness mean the immediate future is right now overwhelming health care systems around the world as increasingly more folks call for utilization of Intensive Care Unit hospitalization.
During the first job interview of mine with Dr. Nader Pourhassan back in March of 2020, the extreme passion of his for the prospects of this drug’s effectiveness was apparent.
This was before the currently raging next wave had gathered heavy steam, and he was then discovering individuals which were receiving leronlimab underneath the FDA’s Emergency Investigative New Drug exemption.
At the time, nonetheless,, this little independent biotech with no big funding and a decidedly unfortunate public listing on the naked short-sellers’ fantasy OTC marketplace was getting able to apply for a listing on NASDAQ, and the deck was stacked against it.
Full Disclosure: I posses 10,000 shares at an average price of $6.23
Even though the world focuses breathlessly on the hope for the latest vaccine to restore their community liberties, the 10-ish fraction of COVID infectees that descend into the cytokine storm-driven ARDS actually have their lives saved by this seemingly flexible drug. For these people, a vaccine is pretty much useless.
This drug has “blockbuster potential” written all over it.
With 394 individuals enrolled inside the Phase 2b/3 trial as of December 16, and initially data expected this week, any demonstrable consistency in the details is going to capture the world’s attention in probably the most profound way. Quick sellers could be swept apart (at minimum temporarily) as the company’s brand new share price amounts qualify it for NASDAQ listing.
Cytodyn management says it’s 700,000 doses all set for sale now, with an additional 2.5 zillion ordered for each of 2021 plus 2022 in a manufacturing arrangement with Samsung, based on the CEO of its.
really if leronlimab/PRO 140/Vyrologix is very great, how come the stock’s been stuck in sub 1dolar1 five penny stock purgatory for so very long?
The quick answer is “OTC”.
Besides faced with a share price under three dolars, the company hasn’t been in a position to meet and maintain some other quantitative prerequisites, including good shareholders’ equity that is at least five dolars million.
But in the NASDAQ community, you can find non quantifiable behaviours by organizations that create waiting times to NASDAQ listings. Overtly promotional communications are among such criteria which won’t ever cause a refusal letter…nor a NASDAQ listing.
Most importantly, Cytodyn has also not been able to access capital under standard means, because of its being mentioned on the OTC, along with consequently un attractive on that foundation alone to white shoe firms.
Thus, they have been reduced to accepting shareholder-hostile OID debentures with ugly sales terms that generate a short-seller’s stormy dream.
In November, they took 28.5 million from Streeterville Capital of which only $25 million was given to the company; $3.4 zillion will be the discount the Streeterville sections, and $100k is reserved to cover the expenditures. Streeterville is actually related with Illiad Trading and Research, that is controlled by John Fife of Chicago Ventures Inc. Iliad has been termed as a “legendary so-called toxic lender”, by rival studies tight Utopia Capital Research.
Cytodyn Inc (OTCMKTS:CYDY)
Under the phrases of the price, Cytodyn wants to pay again $7.5 million a month. If they do not have the cash, they spend inside stock; many not long ago, within a conversion cost of $3.40 a share.
These days consider when you’re an opportunistic low rent lender and you have got an assured 2.2 million shares coming your way in the very first week of each month. Any cost above the conversion cost is pure profit. Remember – this guy is not an investor; he’s a lender.
He is not operating on the expectation that Cytodyn stock might go parabolic in the event that leronlimab is deemed a cure for ARDS; his business model is to limit risk and maximize upside through discounted transformation of share.
This’s the short seller’s wet dream I’m discussing. Not merely is the lender enticed to go short, but some short-trading bucket repair shop in town who are able to fog a mirror and read an EDGAR filing understand that each month, like clockwork, there is going to be two million+ shares impacting the bid down to $3.40.
The SEC isn’t impressed, in addition, on September 3, 2020, filed a complaint.
The Securities and Exchange Commission today filed charges against John M. Fife of Chicago and Companies he controls for acquiring and marketing much more than twenty one billion shares of penny stock without any registering to be a securities dealer with the SEC.
The SEC’s complaint, alleges that in between 2015 as well as 2020, Fife, and also the companies of his, Chicago Venture Partners, L.P., Iliad Research and Trading, L.P., St. George Investments LLC, Tonaquint, Inc., as well as Typenex Co-Investment, LLC, regularly interested in the company of buying convertible notes from penny stock issuers, transforming these notes into shares of inventory at a major discount from the market price, and selling the freshly issued shares to the market at a substantial profit. The SEC alleges which Fife and his companies interested in around 250 convertible transactions with roughly 135 issuers, sold greater than 21 billion newly issued penny stock shares into the market, and obtained greater than sixty one dolars million in profits.
Streeterville Capital is not mentioned as an entity of the complaint. Which implies that it was very likely used by Cytodyn as well as Fife to avoid detection by the SEC this very same plan was being perpetrated on Cytodyn at the time of its complaint.
But that’s not the sole reason the stock cannot maintain any upward momentum.
The company has been selling inventory privately at ridiculously low prices, to the point in which one wonders just that exactly are the lucky winners of what amounts to no cost millions of dollars?
Moreover, beginning inside the month of November 2020 and also for every one of the following 5 (five) calendar days thereafter, the Company is actually obligated to cut down the outstanding sense of balance with the Note by $7,500,000 per month (the “Debt Reduction Amount”). Payments the Company makes under the Prior Notes will be credited to the transaction of each monthly Debt Reduction Amount. The Debt Reduction Amount payments aren’t be subject to the fifteen % prepayment premium.
Likewise detracting from the company’s gloss is the propensity of handling for excessively marketing communications with shareholders. During an investor webcast on January 5th, the company played a number of audio testimonials from patients making use of PRO 140 for HIV therapy, backed by tear-jerking music, and then replete with emotional language devoid of information.
Worse, the company’s telephone number at the bottom part of press releases comes with an extension for Mike Mulholland, the CFO, and Nader Pourhassan, the CEO, but neither one is a “valid extension” according to the automated phone system.
That’s the kind of approach that the SEC and FDA view unfavourably, and is likely at minimum in part the reason behind the continued underdog status of theirs at both agencies.
The company has additionally become unresponsive to requests for interview, and therefore with the story coming out under just these ill advised publicity stunts, shorts are actually attracted, and huge money investors, alienated.
But think of this “management discount” as the ability to buy a sizable job (should one be so inclined) found what could very well prove to be, in a situation of weeks, since the leading treatment for severe COVID19 related illness.
I expect the data in the trial now concluded for just such an indication may launch the business into a whole new valuation altitude that will enable it to get over these shortfalls.
Average trading volume is continuous above 6 million shares a day, and before the conclusion of this week, we’ll learn just how effective leronlimab/PRO 140/Vyrologix is for saving lives from the worst of COVID nineteen. If the results are good, this can be a significant winner.
Cytodyn Inc (OTCMKTS:CYDY)