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 members from our 1st feature back in April this year. Billions have been invested into countless biotechs all competing to create a cure or maybe treatment for serious COVID 19 situations which result in death, and also none have succeeded. Except Cytodyn, when early indications are established in the present trial now underway.
But right after a deep jump on the business’s fiscal statements as well as SEC filings, an image emerges of company management working having a “toxic lender” to funnel seriously discounted shares to the lender frequently. An investment in Cytodyn is actually a purely speculative bet on the part of mine, and if the expected upward price movement does not occur following results of the company’s phase 2b/3 trial for severe-to-critical COVID-19, I will exit the investment.
If the company’s drug does in fact reliably preserve life in danger of severe-to-critical COVID19 patients, then a groundswell of investor assistance could drive the business into completely new, higher grade relationships, which would allow for the redemption of debentures as well as elimination of reliance on fly-by-night financings for example those discussed below.
Cytodyn’s sole focus is actually creating remedies used on a monoclonal antibody known as “leronlimab”, technically called “humanized IgG4, monoclonal antibody (mAb) to the C-C chemokine receptor type 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 development and research by Cytodyn has demonstrated the ability to reduce regular drug cocktails with myriad pills right into an individual monthly injection, in some instances, with zero side effects. To day, 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 from some stable tumours to NASH (Non alcoholic steatohepatitis), the liver function condition which afflicts up to 12 % of the US public, and up to 26 % globally.
But the real emergent and likely transformational application for leronlimab, as stated at the beginning, (which is already being branded as Vyrologix by Cytodyn), is designed for the Acute Respiratory Distress Syndrome (ARDS) brought on by COVID 19 which precludes the Sequential Organ Failure in fatal instances of COVID infections.
Leronlimab it seems that blocks the CCR5 receptor from over responding to the virus and also launching the now household-word “cytokine storm”. Some proportion of patients obviously return from the brink after two treatments (and in a number of cases, one treatment) of leronlimab, still when intubated.
The company completed enrollment of a stage 2b/3 trial on December fifteen to “evaluate the efficacy as well as safety of leronlimab for clients 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 period concluded on January 12-ish, and if the results are positive, this can make leronlimab a top therapy for ARDS.
Cytodyn Inc (OTCMKTS:CYDY)
Although the vaccines which are currently circulating are certainly lending optimism for a normalization of modern society by mid-2021, the surging worldwide rates of infection mean the immediate future is right now overwhelming health care systems throughout the world as more and more folks require ability to access Intensive Care Unit hospitalization.
During the 1st job interview of mine with Dr. Nader Pourhassan back found March of 2020, the serious interest of his for the prospects of this drug’s success was evident.
This was prior to the currently raging next wave had gathered vapor, and also he was then seeing patients who were receiving leronlimab underneath the FDA’s Emergency Investigative New Drug exemption.
At the time, though, this little independent biotech without big funding along with a decidedly unhappy public listing on the naked short-sellers’ fantasy OTC marketplace was getting able to utilize for a listing on NASDAQ, as well as the deck was stacked against it.
Full Disclosure: I own 10,000 shares at an average price of $6.23
Even though the world focuses breathlessly on the hope for a new vaccine to regain their social liberties, the 10 ish percentage of COVID infectees that descend into the cytokine storm-driven ARDS actually have their day saved by this apparently versatile drug. To them, a vaccine is literally pointless.
This drug has “blockbuster potential” written all over it.
With 394 individuals enrolled with the Phase 2b/3 trial as of December sixteen, in addition to initially data expected this week, any demonstrable consistency in the information is going to record the world’s interest in likely the most profound way. Quick sellers may be swept apart (at least temporarily) simply because company’s brand new share priced levels qualify it for NASDAQ listing.
Cytodyn management says it has 700,000 doses prepared for sale right now, with an extra 2.5 million ordered for each of 2021 plus 2022 in a manufacturing arrangement with Samsung, according to its CEO.
so if leronlimab/PRO 140/Vyrologix is so great, how come the stock’s been stuck in sub-1dolar1 5 penny stock purgatory for such a long time?
The fast remedy is “OTC”.
Besides faced with a share price under three dolars, the company hasn’t been equipped to meet and maintain some other quantitative requirements, including positive shareholders’ equity that is at least five dolars million.
But in the NASDAQ community, one can find non quantifiable behaviours by businesses that cause waiting times to NASDAQ listings. Overtly advertising communications are actually among such criteria which will never cause a refusal letter…nor a NASDAQ listing.
More to the point, Cytodyn has additionally not been in a position to access capital under conventional ways, because of its being mentioned on the OTC, and consequently un attractive on that basis alone to white shoe firms.
Thus, they’ve been reduced to accepting shareholder-hostile OID debentures with unsightly conversion terms that create a short-seller’s damp dream.
In November, they coppied 28.5 zillion out of Streeterville Capital of which just $25 million was paid to the company; $3.4 zillion will be the discount the Streeterville areas, and $100k is reserved to cover the expenditures. Streeterville is actually associated with Illiad Research and Trading, which is operated by John Fife of Chicago Ventures Inc. Iliad has been termed as a “legendary so-called poisonous lender”, by rival research firm Utopia Capital Research.
Cytodyn Inc (OTCMKTS:CYDY)
Under the phrases of the offer, Cytodyn has to pay back $7.5 million a month. In case they don’t possess the cash, they spend within stock; most not long ago, at a sales cost of $3.40 a share.
Now just imagine if you’re an opportunistic low-rent lender and you have gained a certain 2.2 million shares coming your way in the very first week of each month. Any price above the conversion price is pure profit. Remember – this guy is not an investor; he’s a lender.
He is not operating on the hope that Cytodyn stock could go parabolic in the event that leronlimab is deemed a remedy for ARDS; the online business model of his is limiting risk and maximize upside via discounted conversion of share.
This is the quick seller’s wet dream I am talking about. Not merely would be the lender enticed to go brief, but any short trading pail shop in town who could fog a mirror and examine an EDGAR filing realize that every month, like clockwork, there’s going to be two million+ shares hitting the bid lowered by to $3.40.
The SEC is not impressed, additionally, on September three, 2020, filed a criticism.
The Securities and Exchange Commission today filed charges against John M. Fife of Companies and Chicago he controls for obtaining and selling much more than 21 billion shares of penny stock without registering as a securities dealer using the SEC.
The SEC’s criticism, alleges that in between 2015 and 2020, Fife, as well as 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, regularly involved in the company of buying sports convertible paperwork at penny stock issuers, transforming these notes into shares of stock at a large discount from the market cost, and offering the freshly issued shares into the marketplace at a substantial profit. The SEC alleges that Fife as well as the companies of his engaged in over 250 convertible transactions with about 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 earnings.
Streeterville Capital isn’t mentioned as an entity of the complaint. Which implies it was probably utilized by Fife as well as Cytodyn to stay away from detection by the SEC this same plan was getting perpetrated on Cytodyn within the time of the complaint of its.
But that is not the sole reason the stock can’t preserve some upward momentum.
The company has been selling inventory privately from ridiculously low prices, to the position where one wonders just that exactly are the blessed winners of what requires no cost millions of dollars?
In addition, beginning in the month of November 2020 and also for every one of the following five (5) calendar days thereafter, the Company is actually required to cut down the exceptional sense of balance of the Note by $7,500,000 a month (the “Debt Reduction Amount”). Payments the Company makes within the Prior Notes are going to 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.
Also detracting from the business’s shine is the propensity of management for endlessly 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 therefore replete with mental language devoid of data.
Worse, the company’s cell 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 automatic system.
That’s the sort of approach that the SEC and FDA view unfavourably, and it is likely at the very least in part the reason for the continued underdog status of theirs at both agencies.
The company also has become unresponsive to requests for interviews, and therefore using the story coming out less than just these ill-advised publicity stunts, shorts are attracted, and big money investors, alienated.
But think of this particular “management discount” as the chance to acquire a sizable role (should a person be so inclined) contained what may really well turn out to be, in a question of weeks, given that the best therapy for severe COVID19 related illness.
I expect the information from your trial now concluded for just such a sign might launch the company into a whole new valuation altitude that will enable it to get over these shortfalls.
Average trading volume is steady above 6 million shares one day, and right before the end of this week, we’ll know precisely how efficient leronlimab/PRO 140/Vyrologix is at saving lives from the worst of COVID nineteen. In case the outcomes are positive, this can be a significant winner.
Cytodyn Inc (OTCMKTS:CYDY)