Cytodyn (CYDY) Phase 2b/3 Trial Results Expected Any Day
Cytodyn Inc (OTCMKTS:CYDY), a late-stage biotech drug developer, has already shipped a win for Wealthpress subscribers from our 1st feature back in April this year. Billions have been invested straight into a huge selection of biotechs all competing to produce a cure or maybe therapy for serious COVID 19 situations which trigger death, and none have been successful. Except for Cytodyn, when early indications are confirmed in the present trial now underway.
But right after a deep dive on the company’s financial claims as well as SEC filings, an image emerges of company control functioning with a “toxic lender” to direct severely discounted shares to the lender regularly. An investment in Cytodyn is actually a strictly speculative bet on the part of mine, and if the anticipated upward price movement does not manifest following results of the company’s phase 2b/3 trial for severe-to-critical COVID-19, I am going to exit the investment.
In case the company’s drug does actually reliably spend less lifestyles in danger of severe-to-critical COVID19 individuals, then a groundswell of investor support could drive the business into new, higher-grade human relationships, which would allow for the redemption of elimination and debentures of reliance on fly-by-night financings such as those described below.
Cytodyn’s sole focus is actually creating remedies based on a monoclonal antibody called “leronlimab”, technically called “humanized IgG4, monoclonal antibody (mAb) to the C C chemokine receptor sort 5 (CCR5)”. This particular engineered antibody was acquired from Progenics Pharmaceuticals as “PRO 140”, a recently-acquired subsidiary of Lantheus Holdings Inc (NASDAQ:LNTH), again in 2012.
Total expense of acquisition amounts to $10 million and a five % net royalty on business sales.
The drug was acquired on its first promise as an HIV treatment, for which continued development as well as research by Cytodyn has shown the capability to reduce regular drug cocktails with assortment pills right into a single monthly injection, sometimes, with 0 unintended effects. To date, the FDA has denied Cytodyn’s Biologics License Application (BLA)
Since then, Cytodyn’s scientific team has realized the antibody’s influence on the CCR5 receptor has incredibly positive therapeutic implications for everything out of some solid tumours to NASH (Non alcoholic steatohepatitis), the liver function disorder that afflicts up to twelve % of the US public, and up to 26 % globally.
But the real emergent and likely transformational program for leronlimab, as I have said at the start, (which is currently getting branded as Vyrologix by Cytodyn), is made for the Acute Respiratory Distress Syndrome (ARDS) caused by COVID-19 that precludes the Sequential Organ Failure in fatal instances of COVID infections.
Leronlimab evidently blocks the CCR5 receptor from over-responding to the virus and launching the today household word “cytokine storm”. Some proportion of patients apparently return from the brink following 2 treatments (and in some cases, 1 treatment) of leronlimab, even when intubated.
The company completed enrollment of a phase 2b/3 trial on December 15 to “evaluate the efficacy as well as safety of leronlimab for patients with severe-to-critical COVID-19 indications is a two-arm, randomized, double blind, placebo controlled, adaptive design and style multicenter study,” based on 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 top remedy for ARDS.
Cytodyn Inc (OTCMKTS:CYDY)
While the vaccines that are presently diffusing are definitely lending hope for a normalization of modern culture by mid-2021, the surging global rates of contamination suggest the immediate future is right now overwhelming health care systems around the world as increasingly more men and women require access to Intensive Care Unit hospitalization.
During my first job interview with Dr. Nader Pourhassan returned found March of 2020, the extreme passion of his for the prospects of the drug’s efficacy was evident.
It was before the currently raging second trend had gathered vapor, as well as he was then seeing individuals that were getting leronlimab underneath the FDA’s Emergency Investigative New Drug exemption.
Within the time, nevertheless,, this little independent biotech without any major funding and a decidedly unhappy public listing on the naked short-sellers’ fantasy OTC marketplace was getting prepared to put on for a listing on NASDAQ, and the deck was stacked from it.
Full Disclosure: I have 10,000 shares at an average price of $6.23
Even though the world focuses breathlessly on the hope for a new vaccine to restore their community liberties, the 10 ish fraction of COVID infectees who descend into the cytokine storm-driven ARDS actually have their day saved by this seemingly flexible drug. For these people, a vaccine is literally useless.
This particular drug has “blockbuster potential” written all over it.
With 394 individuals enrolled in the Phase 2b/3 trial as of December 16, and first data expected this week, a demonstrable consistency in the information will record the world’s attention in likely the most profound way. Short sellers might be swept apart (at the very least temporarily) as the business’s brand new share price levels qualify it for NASDAQ listing.
Cytodyn management says it has 700,000 doses prepared for sale now, with an additional 2.5 million purchased for each of 2021 as well as 2022 in a manufacturing arrangement with Samsung, based on its CEO.
really if leronlimab/PRO 140/Vyrologix is so great, why the stock’s been trapped in sub-1dolar1 five penny stock purgatory for so long?
The speedy remedy is “OTC”.
Besides struggling with a share price under $3, the company has not been in a position to meet and keep certain different quantitative prerequisites, including good shareholders’ equity that is at least five dolars million.
But in the NASDAQ world, you can find non-quantifiable behaviours by companies that can cause waiting times to NASDAQ listings. Overtly promotional communications are among such type of criteria which won’t ever lead to a refusal letter…nor a NASDAQ listing.
More importantly, Cytodyn has also not been equipped to access capital under conventional ways, thanks to its being mentioned on the OTC, in addition to thus un attractive on that basis alone to white colored shoe firms.
Thus, they have been cut down to accepting shareholder-hostile OID debentures with unsightly conversion terms that generate a short-seller’s stormy dream.
In November, they coppied 28.5 million coming from Streeterville Capital of which only $25 million was paid to the company; $3.4 huge number of will be the discount the Streeterville pockets, and $100k is actually set aside to cover the costs. Streeterville is actually associated with Illiad Trading and Research, that is controlled by John Fife of Chicago Ventures Inc. Iliad has been termed as a “legendary so called poisonous lender”, by rival studies firm Utopia Capital Research.
Cytodyn Inc (OTCMKTS:CYDY)
Under the terms of the price, Cytodyn must pay back again $7.5 million every month. If they don’t possess the cash, they spend in stock; most lately, within a conversion price of $3.40 a share.
These days just think about when you are an opportunistic low-rent lender and you have got a guaranteed 2.2 million shares coming the way of yours in the first week of every 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 expectation that Cytodyn stock might go parabolic in the event that leronlimab is deemed a cure for ARDS; his business model is limiting risk and optimize upside via affordable transformation of share.
This is the short seller’s wet dream I’m speaking about. Not merely would be the lender enticed to go short, but any short-trading container dealer in town who could fog a mirror and examine an EDGAR filing know that each month, like clockwork, there is going to be two million+ shares hitting the bid down to $3.40.
The SEC isn’t impressed, additionally, on September 3, 2020, filed a complaint.
The Securities and Exchange Commission these days filed charges against John M. Fife of Companies and Chicago he controls for obtaining and promoting much more than 21 billion shares of penny stock without registering to be a securities dealer with the SEC.
The SEC’s complaint, alleges this in between 2015 and 2020, Fife, and also the companies of his, Chicago Venture Partners, L.P., Iliad Research in addition to the Trading, L.P., St. George Investments LLC, Tonaquint, Inc., in addition to the Typenex Co-Investment, LLC, routinely engaged in the business of buying sports convertible notes from penny stock issuers, converting the notes into shares of stock at a big discount from the market price, and selling the newly issued shares to the marketplace at a sizable profit. The SEC alleges which Fife as well as the businesses of his interested in around 250 sports convertible transactions with roughly 135 issuers, sold more than 21 billion newly issued penny stock shares into the market, and obtained greater than $61 million in earnings.
Streeterville Capital isn’t mentioned as an entity of the complaint. Which hints that it was likely used by Fife as well as Cytodyn to stay away from detection by the SEC this same plan was being perpetrated on Cytodyn within the time of its complaint.
But that is not the only reason the stock can’t keep some upward momentum.
The company has been selling inventory privately from ridiculously minimal prices, to the point where by one wonders just that exactly are the lucky winners of what amounts to free millions of dollars?
Moreover, starting within the month of November 2020 and for every one of the next five (five) calendar days thereafter, the Company is actually obligated to bring down the excellent sense of balance with the Note by $7,500,000 a month (the “Debt Reduction Amount”). Payments the Company makes under the Prior Notes will be credited to the transaction of each month Debt Reduction Amount. The Debt Reduction Amount payments are not be subject to the fifteen % prepayment premium.
Additionally detracting from the business’s gloss is the propensity of managing for excessively promotional communications with shareholders. During an investor webcast on January 5th, the business had a compilation of audio testimonials from clients using PRO 140 for HIV therapy, backed by tear-jerking music, and replete with emotional language devoid of information.
Even worse, the company’s phone number at the bottom of press releases has an extension for Nader Pourhassan, the CFO, and Mike Mulholland, the CEO, but neither one is a “valid extension” based on the automatic phone system.
That’s the kind of approach that the FDA and SEC view unfavourably, and is likely at minimum in part the reason behind the continued underdog status of theirs at both agencies.
The company also has turned out to be unresponsive to requests for interview, and so using the story coming out less than merely these ill-advised publicity stunts, shorts are attracted, and big money investors, alienated.
But think of this specific “management discount” as the opportunity to acquire a sizable position (should one be so inclined) contained what could very well prove to be, in a situation of weeks, since the leading therapy for serious COVID19 associated illness.
I expect the information in the trial now concluded for only such a sign could launch the organization into a whole new valuation altitude that will permit it to get over these shortfalls.
Average trading volume is continuous above 6 million shares a day, and before the 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 outcomes are positive, this may be a huge winner.
Cytodyn Inc (OTCMKTS:CYDY)