Cytodyn (CYDY) Phase 2b/3 Trial Results Expected Any Day
Cytodyn Inc (OTCMKTS:CYDY), a late stage biotech drug developer, has already delivered a win for Wealthpress subscribers from our first feature returned in April this season. Billions have been invested directly into a huge selection of biotechs all competing to make a medicine or perhaps therapy for severe COVID-19 instances which cause death, as well as none have been successful. Except for Cytodyn, if early indications are verified in the present trial now underway.
But after a deep jump on the company’s monetary claims as well as SEC filings, an image emerges of company control operating having a “toxic lender” to funnel severely discounted shares to the lender regularly. An investment in Cytodyn is actually a purely speculative bet on my part, and when the anticipated upward price movement does not manifest after results in 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 in fact reliably save lifestyles to come down with severe-to-critical COVID19 individuals, subsequently a groundswell of investor assistance may push the business into completely new, higher-grade human relationships, which would permit for the redemption of elimination as well as debentures of reliance on fly-by-night financings like those discussed below.
Cytodyn’s sole focus is creating remedies based on a monoclonal antibody called “leronlimab”, technically described 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 expense of acquisition amounts to ten dolars million plus a 5 % net royalty on business revenue.
The drug was acquired on the early promise of its as an HIV therapy, for which continued development as well as research by Cytodyn has highlighted the ability to reduce regular drug cocktails with myriad pills right into a single monthly injection, in some cases, with 0 unwanted side effects. To date, the FDA has denied Cytodyn’s Biologics License Application (BLA)
Since that time, Cytodyn’s scientific staff has discovered the antibody’s influence on the CCR5 receptor has incredibly positive therapeutic implications for everything out of some stable tumours to NASH (Non-alcoholic steatohepatitis), the liver function ailment which afflicts up to 12 % of the US public, and up to twenty six % globally.
But the real emergent also potentially transformational program for leronlimab, as I have said at the beginning, (which is already getting branded as Vyrologix by Cytodyn), is designed for the Acute Respiratory Distress Syndrome (ARDS) due to COVID-19 that precludes the Sequential Organ Failure in fatal cases of COVID infections.
Leronlimab it seems that blocks the CCR5 receptor from over-responding to the virus and also launching the today household-word “cytokine storm”. Some proportion of individuals apparently return from the brink following two treatments (and in some cases, 1 treatment) of leronlimab, still when intubated.
The company finished enrollment of a level 2b/3 trial on December 15 to “evaluate the efficacy and safety of leronlimab for individuals with severe-to-critical COVID-19 indications is actually 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 results are positive, this can make leronlimab a top therapy for ARDS.
Cytodyn Inc (OTCMKTS:CYDY)
While the vaccines that are currently dispersing are certainly lending optimism for a normalization of society by mid-2021, the surging global rates of contamination mean the immediate future is today overwhelming health care systems throughout the world as more and more folks require access to Intensive Care Unit hospitalization.
During the 1st job interview of mine with Dr. Nader Pourhassan returned contained March of 2020, his serious enthusiasm for the prospects of this drug’s effectiveness was evident.
It was prior to the now raging second wave had gathered heavy steam, and also he was then seeing patients who were getting leronlimab under the FDA’s Emergency Investigative New Drug exemption.
Within the time, nonetheless,, this small independent biotech with no major funding and a decidedly unfortunate public listing on the naked short-sellers’ dream OTC marketplace was getting prepared to put on for a listing on NASDAQ, as well as the deck was stacked from it.
Full Disclosure: I posses 10,000 shares from an average expense of $6.23
Even though the world focuses breathlessly on the optimism for a new vaccine to restore the social liberties of theirs, the 10-ish percentage of COVID infectees that descend into the cytokine storm driven ARDS literally have their day saved by this apparently flexible drug. For these people, a vaccine is literally pointless.
This particular drug has “blockbuster potential” written all over it.
With 394 patients enrolled inside the Phase 2b/3 trial as of December 16, in addition to first data expected this week, any demonstrable consistency in the details will capture the world’s interest in pretty much the most profound way. Quick sellers could be swept aside (at minimum temporarily) simply because company’s new share price levels qualify it for NASDAQ listing.
Cytodyn management says it’s 700,000 doses ready for sale right now, with an additional 2.5 huge number of ordered for each of 2021 and 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 trapped in sub 1dolar1 5 penny stock purgatory for such a long time?
The quick answer is “OTC”.
Besides struggling with a share price under three dolars, the company has not been in a position to meet and keep certain different quantitative requirements, like good shareholders’ equity with a minimum of $5 million.
But in the NASDAQ world, you can find non quantifiable behaviours by organizations that can cause slow downs to NASDAQ listings. Overtly promotional communications are among such criteria that will never result in a refusal letter…nor a NASDAQ listing.
More importantly, Cytodyn in addition has not been in a position to access capital under traditional ways, because of its being listed on the OTC, and consequently un-attractive on that foundation alone to white colored shoe firms.
Thus, they’ve been lowered to accepting shareholder-hostile OID debentures with unsightly sales terms that create a short-seller’s stormy dream.
In November, they borrowed 28.5 million coming from Streeterville Capital of that just $25 million was given to the company; $3.4 zillion would be the discount the Streeterville pockets, and $100k is actually put aside to protect the costs. Streeterville is actually related with Illiad Trading and Research, that is operated by John Fife of Chicago Ventures Inc. Iliad has been termed as a “legendary so-called toxic lender”, by rival research tight Utopia Capital Research.
Cytodyn Inc (OTCMKTS:CYDY)
Under the phrases of the price, Cytodyn has got to pay again $7.5 million per month. In case they don’t have the cash, they pay inside stock; most lately, within a sales price of $3.40 a share.
These days just think about if you are an opportunistic low rent lender and you have received an assured 2.2 million shares coming your way in the very first week of every month. Any price above the conversion expenditure is pure profit. Remember – this guy isn’t an investor; he is a lender.
He’s not operating on the expectation that Cytodyn stock could go parabolic if leronlimab is deemed a remedy for ARDS; the business model of his is to limit risk and maximize upside through discounted conversion of share.
This is the short seller’s wet dream I am discussing. Not merely is definitely the lender enticed to go short, but any short-trading pail dealer in town who are able to fog a mirror and examine an EDGAR filing know that every month, like clockwork, there is going to be two million+ shares striking the bid lowered by to $3.40.
The SEC isn’t impressed, additionally, on September three, 2020, filed a criticism.
The Securities and Exchange Commission these days filed charges against John M. Fife of Chicago and Companies he controls for obtaining and marketing much more than 21 billion shares of penny stock without registering to be a securities dealer while using the SEC.
The SEC’s complaint, alleges that between 2015 and 2020, Fife, and his companies, 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 interested in the business of buying convertible paperwork from penny stock issuers, transforming these notes into shares of inventory at a big discount from the market cost, and selling the freshly issued shares into the market at a substantial profit. The SEC alleges that Fife and his businesses interested in over 250 convertible transactions with roughly 135 issuers, sold greater than twenty one billion newly-issued penny stock shares into the industry, and obtained greater than $61 million in profits.
Streeterville Capital isn’t stated as an entity of the complaint. Which hints it was very likely utilized by Cytodyn as well as Fife to avoid detection by the SEC that this very same plan was being perpetrated on Cytodyn within the time of its complaint.
But that is not the only reason the stock cannot observe some upward momentum.
The company has been offering inventory privately from ridiculously low prices, to the point where by one wonders just who exactly are the lucky winners of what requires free millions of dollars?
In addition, beginning inside the month of November 2020 and also for each of the following five (5) calendar days thereafter, the Company is required to reduce the outstanding harmony of 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 payment of each month Debt Reduction Amount. The Debt Reduction Amount payments aren’t be subject to the 15 % prepayment premium.
Additionally detracting from the business’s gloss is actually the propensity of management for endlessly promotional communications with shareholders. During an investor webcast on January 5th, the company had a series of sound testimonials from clients making use of PRO 140 for HIV treatment, backed by tear-jerking music, and replete with mental language devoid of data.
Worse, the company’s 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 particular is a “valid extension” according to the automated system.
That is the sort of approach that the FDA and SEC view unfavourably, and is likely at minimum in part the reason behind their continued underdog status at both agencies.
The company also has become unresponsive to requests for interview, and so with the story coming out less than just these ill-advised publicity stunts, shorts are attracted, and huge money investors, alienated.
But think of this specific “management discount” as the chance to get a sizable role (should one be so inclined) contained what might very well prove to be, in a question of weeks, since the best treatment for serious COVID19 associated illness.
I expect the data from the trial now concluded for just such a sign may launch the company into a whole new valuation altitude that will permit it to overpower these shortfalls.
Average trading volume is continuous above six million shares a day, and before the conclusion of this week, we will find out precisely how efficient leronlimab/PRO 140/Vyrologix is actually for saving lives from the worst of COVID 19. If the outcomes are positive, this can be a huge winner.
Cytodyn Inc (OTCMKTS:CYDY)