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 first feature returned in April this season. Billions have been invested into hundreds of biotechs all competing to produce a medicine or perhaps therapy for serious COVID 19 instances which cause death, as well as none have been successful. Except for Cytodyn, when early indications are verified in the current trial now underway.
But right after a serious plunge on the business’s monetary claims and SEC filings, a picture emerges of company control functioning with a “toxic lender” to direct seriously discounted shares to the lender regularly. An investment in Cytodyn is actually a strictly speculative bet on the part of mine, of course, if the anticipated upward price movement doesn’t occur after results in the company’s stage 2b/3 trial for severe-to-critical COVID 19, I am going to exit the investment.
If the business’s drug does in fact reliably spend less lives in severe-to-critical COVID19 individuals, then a groundswell of investor assistance may drive the business into completely new, higher-grade human relationships, which would permit 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 developing remedies used on a monoclonal antibody known as “leronlimab”, technically described as “humanized IgG4, monoclonal antibody (mAb) to the C C chemokine receptor sort 5 (CCR5)”. This particular engineered antibody was purchased 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 and a 5 % net royalty on commercial sales.
The drug was acquired on the first promise of its as an HIV treatment, for which continued development and research by Cytodyn has shown the ability to reduce regular drug cocktails with assortment pills right into a specific monthly injection, in some cases, with zero unintended effects. To date, the FDA has denied Cytodyn’s Biologics License Application (BLA)
Since that time, Cytodyn’s scientific team has realized the antibody’s impact on the CCR5 receptor has extremely positive therapeutic implications for everything out of some stable tumours to NASH (Non alcoholic steatohepatitis), the liver function condition that afflicts up to twelve % of the US population, and up to 26 % globally.
But the real emergent and potentially transformational application 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) due to COVID-19 that precludes the Sequential Organ Failure wearing fatal instances of COVID infections.
Leronlimab evidently prevents the CCR5 receptor from over-responding to the virus and launching the now household word “cytokine storm”. Some proportion of clients apparently return from the brink following 2 treatments (and in a number of cases, 1 treatment) of leronlimab, still when intubated.
The company completed enrollment of a stage 2b/3 trial on December fifteen to “evaluate the efficacy and safety of leronlimab for people 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 media release.
This trial phase concluded on January 12 ish, and if the outcomes are positive, this will make leronlimab a premier therapy for ARDS.
Cytodyn Inc (OTCMKTS:CYDY)
Although the vaccines that are now diffusing are surely lending hope for a normalization of modern culture by mid-2021, the surging worldwide rates of contamination mean the immediate future is right now overwhelming health care systems throughout the world as a lot more people call for access to Intensive Care Unit hospitalization.
During my 1st job interview with Dr. Nader Pourhassan back in March of 2020, the extreme interest of his for the prospects of the drug’s effectiveness was evident.
This was prior to the now raging next wave had gathered heavy steam, as well as he was then discovering patients which were receiving leronlimab under the FDA’s Emergency Investigative New Drug exemption.
At the time, although, this little independent biotech without big funding along with 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 against it.
Full Disclosure: I posses 10,000 shares from an average cost of $6.23
Even though the planet focuses breathlessly on the optimism for a brand new vaccine to regain the community liberties of theirs, the 10-ish portion of COVID infectees that descend into the cytokine storm-driven ARDS literally have their day saved by this seemingly versatile drug. To them, a vaccine is practically pointless.
This particular drug has “blockbuster potential” authored all over it.
With 394 patients enrolled in the Phase 2b/3 trial as of December 16, and initially information expected this week, a demonstrable consistency in the information will capture the world’s interest in pretty much the most profound way. Short sellers could be swept apart (at least temporarily) as the company’s brand new share priced 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 and 2022 in a manufacturing understanding with Samsung, based on its CEO.
so if leronlimab/PRO 140/Vyrologix is very great, how come the stock’s been stuck in sub 1dolar1 5 penny stock purgatory for so very long?
The quick solution is “OTC”.
Besides struggling with a share price under three dolars, the company hasn’t been able to meet and maintain some other quantitative prerequisites, like positive shareholders’ equity that is at least $5 million.
But in the NASDAQ world, one can find non-quantifiable behaviours by companies that can cause waiting times to NASDAQ listings. Overtly promotional communications are among these kinds of 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 means, because of its being mentioned on the OTC, in addition to therefore un attractive on that basis alone to white colored shoe firms.
Thus, they’ve been lowered to accepting shareholder hostile OID debentures with ugly sales terms that create a short-seller’s damp dream.
In November, they borrowed 28.5 huge number of from Streeterville Capital of which just $25 million was paid to the company; $3.4 million will be the discount the Streeterville pockets, and $100k is actually put aside to protect the expenses. Streeterville is actually related with Illiad Research and Trading, that is controlled by John Fife of Chicago Ventures Inc. Iliad has been known as a “legendary so called toxic lender”, by rival studies firm Utopia Capital Research.
Cytodyn Inc (OTCMKTS:CYDY)
Under the phrases of the deal, Cytodyn must pay back $7.5 million a month. In case they don’t possess the cash, they pay in stock; the majority of recently, at a sales price of $3.40 a share.
These days consider if you are an opportunistic low-rent lender and you have gained a guaranteed 2.2 million shares coming your way in the very first week of every month. Any cost 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 may go parabolic if leronlimab is deemed a cure for ARDS; his online business model is limiting risk and optimize upside through affordable conversion of share.
This is the short seller’s wet dream I am discussing. Not only is the lender enticed to go short, but any short-trading pail shop in town who are able to fog a mirror and examine an EDGAR filing understand that every month, like clockwork, there is going to be two million+ shares striking the bid lowered by to $3.40.
The SEC is not impressed, additionally, on September 3, 2020, filed a complaint.
The Securities as well as Exchange Commission today filed charges from John M. Fife of Chicago and Companies he controls for acquiring and marketing more than 21 billion shares of penny inventory without the need of registering to be a securities dealer with the SEC.
The SEC’s criticism, alleges that between 2015 as well as 2020, Fife, and his companies, Chicago Venture Partners, L.P., Iliad Research and Trading, L.P., St. George Investments LLC, Tonaquint, Inc., in addition to the Typenex Co-Investment, LLC, frequently interested in the business of purchasing convertible notes from penny stock issuers, converting these notes into shares of inventory at a large discount from the market price, and selling the newly issued shares to the market at a sizable profit. The SEC alleges that Fife as well as his businesses engaged in over 250 convertible transactions with approximately 135 issuers, sold greater than 21 billion newly-issued penny stock shares into the market, and obtained more than sixty one dolars million in earnings.
Streeterville Capital is not mentioned as an entity of the complaint. Which suggests it was very likely used by Fife and Cytodyn to avoid detection by the SEC that this very same plan was being perpetrated on Cytodyn at the time of the complaint of its.
But that’s not the only reason the stock cannot preserve some upward momentum.
The company has been offering inventory privately at ridiculously low prices, to the point in which one wonders just who exactly are the lucky winners of what amounts to no cost millions of dollars?
In addition, starting inside the month of November 2020 as well as for every one of the following 5 (5) calendar days thereafter, the Company is actually obliged to reduce the exceptional harmony of the Note by $7,500,000 a month (the “Debt Reduction Amount”). Payments the Company makes under the Prior Notes will likely 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 handling for excessively promotional communications with shareholders. During an investor webcast on January 5th, the company played a series of audio testimonials from people using PRO 140 for HIV therapy, backed by tear jerking music, and then replete with mental language devoid of information.
Worse, the company’s mobile phone number at the bottom of press releases comes with an extension for Nader Pourhassan, the CFO, and Mike Mulholland, the CEO, but neither one is a “valid extension” based on the automated system.
That is the type of approach that the FDA and SEC view unfavourably, and is likely at least in part the reason for their continued underdog status at both agencies.
The company has additionally turned out to be unresponsive to requests for interviews, and thus while using story coming out less than merely these ill advised publicity stunts, shorts are actually attracted, and huge money investors, alienated.
But think of this specific “management discount” as the ability to get a sizable job (should one be so inclined) contained what might really well prove to be, in a matter of weeks, since the top therapy for serious COVID19 associated illness.
I expect the information from your trial now concluded for just such an indication may release the organization into a whole new valuation altitude that will permit it to get over these shortfalls.
Average trading volume is actually continuous above six million shares a day, and right before the tail end of this week, we’ll learn exactly how effective leronlimab/PRO 140/Vyrologix is actually at saving lives from the worst of COVID nineteen. In case the outcomes are positive, this could be a significant winner.
Cytodyn Inc (OTCMKTS:CYDY)