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 season. Billions have been invested into countless biotechs all competing to create a cure or perhaps treatment for serious COVID 19 instances which trigger death, and also none have succeeded. Except for Cytodyn, if early indications are confirmed in the current trial now underway.
But right after a serious plunge on the company’s monetary claims and SEC filings, an image emerges of company control working having a “toxic lender” to funnel seriously discounted shares to the lender frequently. An investment in Cytodyn is a strictly speculative bet on my part, and when the expected upward price movement doesn’t occur following results in the company’s stage 2b/3 trial for severe-to-critical COVID 19, I am going to exit the investment.
If the company’s drug does actually reliably conserve life in danger of severe-to-critical COVID19 individuals, then a groundswell of investor support could drive the company into new, higher grade human relationships, which would enable 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 developing treatments used on a monoclonal antibody called “leronlimab”, technically referred to as “humanized IgG4, monoclonal antibody (mAb) to the C-C chemokine receptor type five (CCR5)”. This particular engineered antibody was obtained of Progenics Pharmaceuticals as “PRO 140”, a recently-acquired subsidiary of Lantheus Holdings Inc (NASDAQ:LNTH), again in 2012.
Total cost of acquisition amounts to ten dolars million plus a 5 % net royalty on business revenue.
The drug was acquired on its first promise as an HIV treatment, for which continued research and development by Cytodyn has shown the ability to reduce daily drug cocktails with assortment pills into a specific monthly injection, in some cases, with zero negative effects. To day, the FDA has denied Cytodyn’s Biologics License Application (BLA)
Since then, Cytodyn’s scientific staff has realized the antibody’s effect on the CCR5 receptor has incredibly optimistic therapeutic implications for everything out of some stable tumours to NASH (Non-alcoholic steatohepatitis), the liver feature disorder which afflicts up to 12 percent of the US population, and up to 26 % globally.
But the real emergent and likely transformational application for leronlimab, as I have said at the beginning, (which is currently being branded as Vyrologix by Cytodyn), is made for the Acute Respiratory Distress Syndrome (ARDS) brought on by COVID-19 which precludes the Sequential Organ Failure in fatal situations of COVID infections.
Leronlimab apparently blocks the CCR5 receptor from over-responding to the virus and also launching the today household word “cytokine storm”. Some proportion of individuals evidently return from the brink following two 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 clients with severe-to-critical COVID 19 indications is a two-arm, placebo controlled, double blind, randomized, adaptive design multicenter study,” according to the company’s press release.
This trial period concluded on January 12 ish, and if the outcomes are good, this will make leronlimab a top treatment for ARDS.
Cytodyn Inc (OTCMKTS:CYDY)
Even though the vaccines that are presently spreading are certainly lending hope for a normalization of modern culture by mid 2021, the surging global rates of infection suggest the immediate future is today overwhelming health care systems throughout the world as increasingly more individuals require utilization of Intensive Care Unit hospitalization.
During my first job interview with Dr. Nader Pourhassan returned contained March of 2020, the serious eagerness of his for the prospects of the drug’s success was apparent.
This was before the now raging next trend had gathered steam, as well as he was then discovering individuals which were getting leronlimab under the FDA’s Emergency Investigative New Drug exemption.
At the time, nevertheless,, this small independent biotech without major funding along with a decidedly unhappy public listing on the naked short-sellers’ fantasy OTC marketplace was getting prepared to apply for a listing on NASDAQ, along with the deck was stacked from it.
Full Disclosure: I have 10,000 shares at an average expense of $6.23
While the world focuses breathlessly on the optimism for a new vaccine to restore their community liberties, the 10-ish percentage of COVID infectees that descend into the cytokine storm-driven ARDS literally have their lives saved by this apparently flexible drug. For these people, a vaccine is practically useless.
This drug has “blockbuster potential” written all over it.
With 394 patients enrolled with the Phase 2b/3 trial as of December 16, and initially data expected this week, any demonstrable consistency in the information will capture the world’s interest in probably the most profound way. Quick sellers may be swept aside (at the very least temporarily) while the company’s new share priced amounts qualify it for NASDAQ listing.
Cytodyn management says it’s 700,000 doses prepared for sale right now, with an additional 2.5 huge number of ordered for each of 2021 and 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 5 penny stock purgatory for such a long time?
The speedy remedy is “OTC”.
Besides struggling with a share price under three dolars, the company has not been in a position to meet and keep some different quantitative prerequisites, including good shareholders’ equity with a minimum of five dolars million.
But in the NASDAQ community, there are non quantifiable behaviours by businesses that can cause slow downs to NASDAQ listings. Overtly promotional communications are among such criteria which will never lead to a refusal letter…nor a NASDAQ listing.
More importantly, Cytodyn in addition has not been equipped to access capital under traditional means, because of its being listed on the OTC, along with thus un-attractive on that basis alone to white shoe firms.
So, they’ve been reduced to accepting shareholder hostile OID debentures with unsightly sales terms that create a short-seller’s stormy dream.
In November, they took 28.5 million out of Streeterville Capital of which only twenty five dolars million was given to the company; $3.4 huge number of will be the discount the Streeterville pockets, and $100k is reserved to cover the expenses. Streeterville is related with Illiad Research and Trading, which is managed by John Fife of Chicago Ventures Inc. Iliad has been known as a “legendary so called poisonous lender”, by rival research firm Utopia Capital Research.
Cytodyn Inc (OTCMKTS:CYDY)
Under the phrases of the price, Cytodyn has to pay again $7.5 million every month. In case they do not possess the cash, they spend within stock; most not long ago, at a conversion cost of $3.40 a share.
Now consider when you’re an opportunistic low-rent lender and you’ve gained a certain 2.2 million shares coming the way of yours in the very first week of each month. Any price tag above the sales price is pure profit. Remember – this guy isn’t 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; the online business model of his is limiting risk and optimize upside via affordable transformation of share.
This’s the quick seller’s wet dream I’m discussing. Not merely is definitely the lender enticed to go short, but any short trading bucket dealer in town who are able to fog a mirror and go through an EDGAR filing realize 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, and on September 3, 2020, filed a criticism.
The Securities as well as Exchange Commission today filed charges against John M. Fife of Companies and Chicago he controls for obtaining and marketing more than twenty one billion shares of penny inventory without any registering to be a securities dealer using the SEC.
The SEC’s complaint, alleges this in between 2015 as well as 2020, Fife, as well as his businesses, 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, regularly involved in the business of buying convertible notes at penny stock issuers, converting those notes into shares of inventory at a big discount from the market cost, and selling the freshly issued shares to the marketplace at a significant profit. The SEC alleges which Fife as well as his companies interested in over 250 sports convertible transactions with about 135 issuers, sold more than twenty one billion newly issued penny stock shares to the market, and obtained more than $61 million in earnings.
Streeterville Capital is not mentioned as an entity of the complaint. Which implies that it was probably used by Cytodyn and Fife to stay away from detection by the SEC this same scheme was being perpetrated on Cytodyn at the time of its complaint.
But that’s not the only reason the stock can’t preserve any upward momentum.
The company has been offering stock privately at ridiculously low prices, to the position where one wonders just who exactly are the fortunate winners of what requires free millions of dollars?
Additionally, starting within the month of November 2020 and for every one of the next 5 (five) calendar days thereafter, the Company is obligated to lower the exceptional harmony belonging to the Note by $7,500,000 a month (the “Debt Reduction Amount”). Payments the Company makes within the Prior Notes will be credited toward the transaction of each month Debt Reduction Amount. The Debt Reduction Amount payments aren’t be subject to the fifteen % prepayment premium.
Additionally detracting from the business’s shine is actually the propensity of managing for excessively marketing communications with shareholders. During an investor webcast on January 5th, the company played a series of audio testimonials from patients making use of PRO 140 for HIV treatment, backed by tear jerking music, and replete with mental language devoid of data.
Even worse, the company’s phone number at the bottom level of press releases has an extension for Nader Pourhassan, the CFO, and Mike Mulholland, the CEO, but neither one particular is actually a “valid extension” in accordance with the automatic phone system.
That is the type 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 has additionally turned out to be unresponsive to requests for interview, and therefore with the story coming out under merely these ill advised publicity stunts, shorts are attracted, and big money investors, alienated.
But think of this “management discount” as the ability to purchase a sizable role (should one be so inclined) found what might really well prove to be, in a question of weeks, given that the leading treatment for severe COVID19 associated illness.
I expect the information from the trial now concluded for only such a sign can release the business into a whole new valuation altitude that will permit it to overcome these shortfalls.
Average trading volume is continuous above six million shares a day, and before the tail end of this week, we will know precisely how effective leronlimab/PRO 140/Vyrologix is actually at saving lives from the worst of COVID nineteen. If the results are positive, this can be a huge winner.
Cytodyn Inc (OTCMKTS:CYDY)