Cytodyn (CYDY) Phase 2b/3 Trial Results Expected Any Day
Cytodyn Inc (OTCMKTS:CYDY), a late stage biotech drug designer, has already shipped a win for Wealthpress members from our first feature back in April this season. Billions have been invested directly into countless biotechs all competing to create a medicine or perhaps therapy for severe COVID-19 instances that trigger death, as well as none have been successful. Except Cytodyn, if early indications are established in the present trial now underway.
But after a serious plunge on the business’s monetary claims as well as SEC filings, an image emerges of business control functioning having a “toxic lender” to funnel severely discounted shares to the lender frequently. An investment in Cytodyn is actually a purely speculative bet on my part, of course, if the anticipated upward price movement does not manifest following 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 preserve lives in severe-to-critical COVID19 patients, subsequently a groundswell of investor support may force the company into completely new, higher grade relationships, which would enable for the redemption of elimination as well as debentures of reliance on fly-by-night financings for instance those discussed below.
Cytodyn’s sole focus is developing therapies based on a monoclonal antibody known as “leronlimab”, technically called “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 $10 million and a 5 % net royalty on commercial revenue.
The drug was acquired on the first promise of its as an HIV treatment, for which continued development and research by Cytodyn has highlighted the ability to reduce regular drug cocktails with assortment pills into an individual monthly injection, in some cases, with zero adverse reactions. To particular date, the FDA has denied Cytodyn’s Biologics License Application (BLA)
Since then, Cytodyn’s scientific staff has realized the antibody’s impact on the CCR5 receptor has extremely optimistic therapeutic implications for everything from some solid tumours to NASH (Non-alcoholic steatohepatitis), the liver feature condition that afflicts up to twelve % of the US public, and up to twenty six % globally.
But the real emergent and likely transformational program for leronlimab, as mentioned at the start, (which is now being branded as Vyrologix by Cytodyn), is made for the Acute Respiratory Distress Syndrome (ARDS) due to COVID 19 which precludes the Sequential Organ Failure wearing fatal instances of COVID infections.
Leronlimab apparently prevents the CCR5 receptor from over responding to the virus and launching the today household-word “cytokine storm”. Some proportion of individuals obviously return from the brink after two treatments (and in a number of cases, one treatment) of leronlimab, still if intubated.
The company finished enrollment of a level 2b/3 trial on December fifteen to “evaluate the efficacy as well as safety of leronlimab for individuals with severe-to-critical COVID 19 indications is actually a two arm, placebo controlled, double blind, randomized, adaptive design multicenter study,” based on the company’s media release.
This trial phase concluded on January 12 ish, of course, if the outcomes are good, this can make leronlimab a top therapy for ARDS.
Cytodyn Inc (OTCMKTS:CYDY)
Even though the vaccines that are currently circulating are certainly lending optimism for a normalization of society by mid 2021, the surging global rates of contamination suggest the immediate future is today overwhelming health care systems around the world as a lot more folks require access to Intensive Care Unit hospitalization.
During my 1st job interview with Dr. Nader Pourhassan back contained March of 2020, his extreme eagerness for the prospects of the drug’s effectiveness was apparent.
It was prior to the currently raging second wave had gathered heavy steam, and also he was then seeing patients that were receiving leronlimab under the FDA’s Emergency Investigative New Drug exemption.
At the time, although, this small independent biotech without any significant 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 own 10,000 shares from an average cost of $6.23
Even though the planet concentrates breathlessly on the optimism for the latest vaccine to restore their community liberties, the 10 ish fraction of COVID infectees that descend into the cytokine storm-driven ARDS literally have their day saved by this apparently versatile drug. For these people, a vaccine is literally useless.
This drug has “blockbuster potential” written all over it.
With 394 clients enrolled inside the Phase 2b/3 trial as of December 16, and initially data expected this week, any demonstrable consistency in the information is going to record the world’s focus in probably the most profound way. Short sellers could be swept apart (at least temporarily) simply because business’s 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 huge number of purchased for each of 2021 plus 2022 in a manufacturing arrangement with Samsung, based on its CEO.
really if leronlimab/PRO 140/Vyrologix is so great, how come the stock’s been trapped in sub 1dolar1 five penny stock purgatory for such a long time?
The speedy remedy is “OTC”.
Apart from struggling with a share price under $3, the company has not been equipped to meet and keep certain other quantitative requirements, like good shareholders’ equity that is at least five dolars million.
But in the NASDAQ community, one can find non quantifiable behaviours by companies that cause slow downs to NASDAQ listings. Overtly advertising communications are actually among such criteria which won’t ever result in a refusal letter…nor a NASDAQ listing.
More importantly, Cytodyn has also not been equipped to access capital under standard ways, because of its being listed on the OTC, in addition to consequently un-attractive on that basis alone to white colored shoe firms.
And so, they’ve been reduced to accepting shareholder-hostile OID debentures with ugly sales terms that create a short-seller’s wet dream.
In November, they took 28.5 zillion coming from Streeterville Capital of that just $25 million was given to the company; $3.4 huge number of is the discount the Streeterville areas, and $100k is actually put aside to protect the bills. Streeterville is associated with Illiad Research and Trading, that is operated by John Fife of Chicago Ventures Inc. Iliad has been called a “legendary so-called poisonous lender”, by rival studies tight Utopia Capital Research.
Cytodyn Inc (OTCMKTS:CYDY)
Under the phrases of the offer, Cytodyn must pay back again $7.5 million a month. If they do not have the cash, they pay in stock; most recently, within a sales cost of $3.40 a share.
Now just imagine if you are an opportunistic low-rent lender and you’ve gained a guaranteed 2.2 million shares coming the way of yours in the first week of each month. Any price above the conversion expenditure is pure profit. Remember – this guy is not an investor; he is a lender.
He is not operating on the hope that Cytodyn stock could go parabolic in the event that leronlimab is deemed a cure for ARDS; his online business model is limiting risk and maximize upside through affordable conversion of share.
This’s the brief seller’s wet dream I am discussing. Not merely is definitely the lender enticed to go short, but some short trading container dealer in town who can fog a mirror and go through an EDGAR filing realize that every month, like clockwork, there’s going to be 2 million+ shares striking the bid lowered by to $3.40.
The SEC is not impressed, additionally, on September 3, 2020, filed a criticism.
The Securities in addition to the Exchange Commission these days filed charges from John M. Fife of Chicago and Companies he controls for obtaining and selling much more than 21 billion shares of penny inventory without the need of registering to be a securities dealer with the SEC.
The SEC’s complaint, alleges this between 2015 as well as 2020, Fife, and also the companies of his, Chicago Venture Partners, L.P., Iliad Research as well as Trading, L.P., St. George Investments LLC, Tonaquint, Inc., and Typenex Co Investment, LLC, frequently engaged in the business of purchasing sports convertible paperwork at penny stock issuers, transforming these notes into shares of inventory at a large discount from the market cost, and offering the newly issued shares into the market at a sizable profit. The SEC alleges that Fife and his companies interested in more than 250 sports convertible transactions with roughly 135 issuers, sold more than twenty one billion newly issued penny stock shares into the industry, and obtained greater than sixty one dolars million in earnings.
Streeterville Capital isn’t stated as an entity of the complaint. Which hints that it was probably used by Cytodyn and Fife to avoid detection by the SEC that this same scheme was getting perpetrated on Cytodyn within the time of the complaint of its.
But that’s not the sole reason the stock can’t preserve any upward momentum.
The company has been selling inventory privately from ridiculously low prices, to the stage where one wonders just who exactly are the fortunate winners of what amounts to no cost millions of dollars?
Furthermore, starting inside the month of November 2020 and also for each of the second five (five) calendar days thereafter, the Company is required to bring down the exceptional balance with the Note by $7,500,000 a month (the “Debt Reduction Amount”). Payments the Company makes under the Prior Notes are going to be acknowledged toward the transaction of each monthly Debt Reduction Amount. The Debt Reduction Amount payments aren’t be subject to the fifteen % prepayment premium.
Additionally detracting from the company’s gloss 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 individuals using PRO 140 for HIV treatment, backed by tear jerking music, and replete with mental language devoid of information.
Worse, the company’s telephone number at the bottom part of press releases comes with 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 system.
That is the kind of approach that the SEC and FDA view unfavourably, and it is likely at minimum in part the reason behind their continued underdog status at both agencies.
The company has additionally become unresponsive to requests for interviews, and so while using story coming out less than only these ill-advised publicity stunts, shorts are attracted, and huge cash investors, alienated.
But think of this specific “management discount” as the chance to get a sizable role (should one be so inclined) contained what could really well turn out to be, in a situation of weeks, as the leading therapy for severe COVID19 related illness.
I expect the data from the trial now concluded for just such an indication may release the company into a whole new valuation altitude that will enable it to overcome these shortfalls.
Average trading volume is constant above six million shares one day, and right before the tail end of this week, we will find out just how efficient leronlimab/PRO 140/Vyrologix is at saving lives from the most severe of COVID 19. In case the results are good, this can be a big winner.
Cytodyn Inc (OTCMKTS:CYDY)