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 returned in April this season. Billions have been invested into hundreds of biotechs all competing to develop a medicine or therapy for severe COVID 19 instances that trigger death, and also none have succeeded. Except for Cytodyn, if early indications are established in the current trial now underway.
But right after a deep jump on the business’s monetary statements and SEC filings, a picture emerges of business control operating who have a “toxic lender” to direct seriously discounted shares to the lender regularly. An investment in Cytodyn is a purely speculative bet on my part, and if the anticipated upward price movement doesn’t occur after results in the company’s phase 2b/3 trial for severe-to-critical COVID-19, I will exit the investment.
If the company’s drug does actually reliably preserve lives to come down with severe-to-critical COVID19 individuals, then a groundswell of investor support can drive the business into new, higher-grade relationships, which would allow for the redemption of elimination and debentures of reliance on fly-by-night financings for instance those described below.
Cytodyn’s sole focus is developing therapies based on a monoclonal antibody known as “leronlimab”, technically described as “humanized IgG4, monoclonal antibody (mAb) to the C C chemokine receptor sort five (CCR5)”. This particular engineered antibody was acquired from Progenics Pharmaceuticals as “PRO 140”, a recently-acquired subsidiary of Lantheus Holdings Inc (NASDAQ:LNTH), back in 2012.
Total expense of acquisition amounts to ten dolars million plus a 5 % net royalty on commercial sales.
The drug was acquired on its early promise as an HIV treatment, for which continued development and research by Cytodyn has demonstrated the potential to reduce regular drug cocktails with assortment pills right into a single monthly injection, sometimes, with 0 negative effects. To particular date, the FDA has denied Cytodyn’s Biologics License Application (BLA)
Since then, Cytodyn’s scientific staff has discovered the antibody’s impact on the CCR5 receptor has incredibly positive therapeutic implications for everything from certain solid tumours to NASH (Non alcoholic steatohepatitis), the liver function ailment which afflicts up to 12 % of the US population, and up to 26 % globally.
But the real emergent and likely transformational application for leronlimab, as mentioned at the beginning, (which is currently being branded as Vyrologix by Cytodyn), is designed for the Acute Respiratory Distress Syndrome (ARDS) due to COVID 19 that precludes the Sequential Organ Failure wearing fatal cases of COVID infections.
Leronlimab it seems that prevents the CCR5 receptor from over responding to the virus as well as launching the now household-word “cytokine storm”. Some proportion of individuals obviously return from the brink following two treatments (and in some cases, 1 treatment) of leronlimab, still if 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 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, of course, if the results are good, this can make leronlimab a top remedy for ARDS.
Cytodyn Inc (OTCMKTS:CYDY)
Even though the vaccines that are currently circulating are certainly lending hope for a normalization of society by mid 2021, the surging worldwide rates of illness suggest the immediate future is right now overwhelming health care systems around the world as increasingly more people call for utilization of Intensive Care Unit hospitalization.
During the first job interview of mine with Dr. Nader Pourhassan returned in March of 2020, his serious interest for the prospects of the drug’s success was apparent.
It was before the now raging next wave had gathered heavy steam, and also he was then seeing individuals that were getting leronlimab underneath the FDA’s Emergency Investigative New Drug exemption.
At the time, though, this small independent biotech with no major 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, as well as the deck was stacked from it.
Full Disclosure: I own 10,000 shares at an average expense of $6.23
While the world focuses breathlessly on the optimism for the latest vaccine to regain the social liberties of theirs, the 10-ish fraction of COVID infectees who descend into the cytokine storm driven ARDS literally have their lives saved by this apparently flexible drug. For them, a vaccine is basically useless.
This drug has “blockbuster potential” written all over it.
With 394 patients enrolled with the Phase 2b/3 trial as of December 16, in addition to initially data expected this week, a demonstrable consistency in the details will record the world’s focus in likely the most profound way. Quick sellers may be swept aside (at the very least temporarily) simply because business’s new share price amounts qualify it for NASDAQ listing.
Cytodyn management says it has 700,000 doses ready for sale now, with an additional 2.5 zillion purchased for each of 2021 plus 2022 in a manufacturing understanding with Samsung, according to the CEO of its.
really if leronlimab/PRO 140/Vyrologix is very great, how come the stock’s been stuck in sub-1dolar1 5 penny stock purgatory for so long?
The speedy answer is “OTC”.
Besides faced with a share price under three dolars, the company hasn’t been able to meet and keep certain different quantitative prerequisites, like good shareholders’ equity of at least $5 million.
But in the NASDAQ world, one can find non quantifiable behaviours by businesses that can cause waiting times to NASDAQ listings. Overtly promotional communications are actually among these kinds of criteria which will never result in a refusal letter…nor a NASDAQ listing.
Most importantly, Cytodyn has also not been equipped to access capital under conventional means, because of its being listed on the OTC, and consequently un attractive on that foundation alone to white colored shoe firms.
Thus, they have been lowered to accepting shareholder-hostile OID debentures with ugly conversion terms that generate a short-seller’s stormy dream.
In November, they coppied 28.5 million coming from Streeterville Capital of that only $25 million was paid to the company; $3.4 zillion would be the discount the Streeterville pockets, and $100k is 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 called a “legendary so-called toxic lender”, by rival studies tight Utopia Capital Research.
Cytodyn Inc (OTCMKTS:CYDY)
Under the terms of the deal, Cytodyn wants to pay back again $7.5 million per month. In case they do not possess the cash, they pay in stock; the majority of not long ago, within a sales price of $3.40 a share.
Now consider if you are an opportunistic low rent lender and you have received a certain 2.2 million shares coming the way of yours in the very first week of each month. Any cost above the conversion expenditure is pure profit. Remember – this guy isn’t an investor; he’s a lender.
He’s not operating on the hope that Cytodyn stock could go parabolic in the event that leronlimab is deemed a cure for ARDS; his business model is limiting risk and maximize upside through affordable transformation of share.
This is the short seller’s wet dream I am talking about. Not merely would be the lender enticed to go short, but some short trading bucket shop in town who are able to fog a mirror and go through an EDGAR filing understand that every month, like clockwork, there is going to be 2 million+ shares hitting the bid down to $3.40.
The SEC is not impressed, additionally, on September three, 2020, filed a criticism.
The Securities as well as Exchange Commission these days filed charges against John M. Fife of Chicago and Companies he controls for obtaining and selling more than twenty one 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, and the companies of his, Chicago Venture Partners, L.P., Iliad Research as well as Trading, L.P., St. George Investments LLC, Tonaquint, Inc., as well as Typenex Co Investment, LLC, routinely interested in the small business of buying convertible notes at penny stock issuers, transforming these notes into shares of inventory at a big discount from the market cost, and selling the freshly issued shares to the marketplace at a sizable profit. The SEC alleges which Fife and the companies of his interested in over 250 sports convertible transactions with around 135 issuers, sold greater than 21 billion newly issued penny stock shares to the market, and obtained greater than sixty one dolars million in profits.
Streeterville Capital isn’t stated as an entity of the complaint. Which suggests it was very likely utilized by Cytodyn and Fife to stay away from detection by the SEC this very same plan was being perpetrated on Cytodyn within the time of its complaint.
But that is not the sole reason the stock can’t observe some upward momentum.
The company has been offering stock privately from ridiculously low prices, to the point in which one wonders just that exactly are the fortunate winners of what amounts to free millions of dollars?
Furthermore, beginning within the month of November 2020 and also for each of the next 5 (5) calendar days thereafter, the Company is obligated to cut down the excellent sense of balance with the Note by $7,500,000 per month (the “Debt Reduction Amount”). Payments the Company makes under the Prior Notes will be acknowledged 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 company’s shine is the propensity of management for excessively promotional communications with shareholders. During an investor webcast on January 5th, the company played a series of sound testimonials from people using PRO 140 for HIV therapy, 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 has an extension for Nader Pourhassan, the CFO, and Mike Mulholland, the CEO, but neither one particular is a “valid extension” according to the automated phone system.
That’s the type of approach that the SEC and FDA view unfavourably, and it is likely at least in part the reason for the continued underdog status of theirs at both agencies.
The company also has turned out to be unresponsive to requests for interview, and therefore while using story coming out under merely these ill-advised publicity stunts, shorts are actually attracted, and huge cash investors, alienated.
But think of this “management discount” as the ability to buy a sizable job (should a person be so inclined) in what might really well turn out to be, in a matter of weeks, since the best treatment for severe COVID19 associated illness.
I expect the data from the trial now concluded for only such an indication may release the business into a complete new valuation altitude that will permit it to get over these shortfalls.
Average trading volume is steady above 6 million shares a day, and before the conclusion of this week, we’ll know exactly how effective leronlimab/PRO 140/Vyrologix is actually at saving lives from the worst of COVID nineteen. In case the results are positive, this can be a significant winner.
Cytodyn Inc (OTCMKTS:CYDY)