Cytodyn (CYDY) Phase 2b/3 Trial Results Expected Any Day
Cytodyn Inc (OTCMKTS:CYDY), a late stage biotech drug creator, has already shipped a win for Wealthpress subscribers from our first feature returned in April this year. Billions have been invested into a huge selection of biotechs all competing to develop a medicine or maybe therapy for severe COVID 19 situations which result in death, and none have succeeded. Except for Cytodyn, if early indications are confirmed in the current trial now underway.
But after a serious jump on the business’s monetary statements as well as SEC filings, an image emerges of business control working who have a “toxic lender” to funnel seriously discounted shares to the lender regularly. An investment in Cytodyn is actually a purely speculative bet on my part, of course, if the anticipated upward price movement doesn’t occur following results in the company’s stage 2b/3 trial for severe-to-critical COVID 19, I will exit the investment.
If the business’s drug does in fact reliably save life to come down with severe-to-critical COVID19 patients, subsequently a groundswell of investor support can push the business into completely new, higher grade relationships, which would permit for the redemption of debentures as well as elimination of reliance on fly-by-night financings for instance those discussed below.
Cytodyn’s sole focus is actually developing treatments based on a monoclonal antibody called “leronlimab”, technically called “humanized IgG4, monoclonal antibody (mAb) to the C-C chemokine receptor sort 5 (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 cost of acquisition amounts to $10 million plus a 5 % net royalty on business revenue.
The drug was acquired on its first promise as an HIV therapy, for which continued research and development by Cytodyn has highlighted the potential to reduce daily drug cocktails with myriad pills into an individual monthly injection, in some instances, with 0 adverse reactions. To particular date, the FDA has denied Cytodyn’s Biologics License Application (BLA)
Since that time, Cytodyn’s scientific team has found the antibody’s influence on the CCR5 receptor has incredibly optimistic therapeutic implications for everything from certain stable tumours to NASH (Non alcoholic steatohepatitis), the liver feature disorder which afflicts up to twelve percent of the US public, and up to twenty six % globally.
But the real emergent also likely transformational application for leronlimab, as I have said at the beginning, (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 cases of COVID infections.
Leronlimab evidently blocks the CCR5 receptor from over responding to the virus and launching the today household-word “cytokine storm”. Some proportion of patients apparently return from the brink after 2 treatments (and in some cases, one treatment) of leronlimab, still if intubated.
The company finished enrollment of a phase 2b/3 trial on December 15 to “evaluate the efficacy as well as safety of leronlimab for patients 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 period concluded on January 12-ish, and if the outcomes are positive, this can make leronlimab a top treatment for ARDS.
Cytodyn Inc (OTCMKTS:CYDY)
While the vaccines which are currently circulating are surely lending hope for a normalization of modern culture 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 men and women call for access to Intensive Care Unit hospitalization.
During my 1st interview with Dr. Nader Pourhassan back in March of 2020, his serious passion for the prospects of the drug’s success was evident.
It was before the currently raging next wave had gathered vapor, and also he was then seeing individuals that were receiving leronlimab under the FDA’s Emergency Investigative New Drug exemption.
Within the time, nonetheless,, this small independent biotech with no big funding along with a decidedly unfortunate public listing on the naked short-sellers’ fantasy OTC marketplace was getting able to apply for a listing on NASDAQ, as well as the deck was stacked from it.
Full Disclosure: I own 10,000 shares from an average price of $6.23
Even though the planet concentrates 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 actually have their day saved by this apparently versatile drug. To them, a vaccine is basically useless.
This drug has “blockbuster potential” written all over it.
With 394 patients enrolled inside the Phase 2b/3 trial as of December 16, and first data expected this week, a demonstrable consistency in the information is going to capture the world’s attention in pretty much the most profound way. Short sellers might be swept apart (at least temporarily) as the company’s brand 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 huge number of purchased for each of 2021 as well as 2022 in a manufacturing agreement with Samsung, according to its CEO.
so if leronlimab/PRO 140/Vyrologix is very great, how come the stock’s been trapped in sub-1dolar1 5 penny stock purgatory for such a long time?
The fast answer is “OTC”.
Besides struggling with a share price under $3, the company has not been equipped to meet and maintain certain different quantitative requirements, including positive shareholders’ equity with a minimum of five dolars million.
But in the NASDAQ community, you can find non-quantifiable behaviours by businesses that create delays to NASDAQ listings. Overtly promotional communications are actually among such criteria which won’t ever result in a refusal letter…nor a NASDAQ listing.
Most importantly, Cytodyn in addition has not been in a position to access capital under standard ways, because of its being mentioned on the OTC, and thus un attractive on that basis alone to white shoe firms.
So, they have been cut down to accepting shareholder-hostile OID debentures with ugly sales terms that generate a short-seller’s damp dream.
In November, they borrowed 28.5 million coming from Streeterville Capital of which just twenty five dolars million was paid to the company; $3.4 million will be the discount the Streeterville sections, and $100k is put aside to protect the expenses. Streeterville is actually associated with Illiad Trading and Research, which is operated by John Fife of Chicago Ventures Inc. Iliad has been known as a “legendary so-called poisonous lender”, by rival studies tight Utopia Capital Research.
Cytodyn Inc (OTCMKTS:CYDY)
Under the terms of the price, Cytodyn has to pay back again $7.5 million per month. In case they do not possess the cash, they spend within stock; many lately, within a conversion price of $3.40 a share.
These days just think about when you are an opportunistic low rent lender and you have received a certain 2.2 million shares coming the way of yours in the earliest week of each month. Any price tag above the conversion expenditure is pure profit. Remember – this guy isn’t an investor; he’s a lender.
He is not operating on the hope that Cytodyn stock might go parabolic in the event that leronlimab is deemed a cure for ARDS; his online business model is to limit risk and maximize upside via affordable conversion of share.
This is the short seller’s wet dream I am speaking about. Not only is definitely the lender enticed to go short, but any short trading pail repair shop in town who are able to fog a mirror and read an EDGAR filing know that every month, like clockwork, there is going to be 2 million+ shares striking the bid lowered by to $3.40.
The SEC isn’t impressed, and on September 3, 2020, filed a complaint.
The Securities and Exchange Commission nowadays filed charges against John M. Fife of Companies and Chicago he controls for acquiring and marketing much more than twenty one billion shares of penny inventory without the need of registering as a securities dealer using the SEC.
The SEC’s complaint, alleges that between 2015 and 2020, Fife, and his companies, Chicago Venture Partners, L.P., Iliad Research and Trading, L.P., St. George Investments LLC, Tonaquint, Inc., and Typenex Co-Investment, LLC, regularly interested in the company of purchasing convertible paperwork at penny stock issuers, transforming those notes into shares of stock at a big discount from the market cost, and selling the freshly issued shares to the marketplace at a significant profit. The SEC alleges that Fife and his companies engaged in around 250 convertible transactions with approximately 135 issuers, sold greater than twenty one billion newly-issued penny stock shares to the industry, and obtained more than $61 million in earnings.
Streeterville Capital isn’t mentioned as an entity in the complaint. Which implies that it was probably utilized by Cytodyn and Fife to stay away from detection by the SEC that this same plan was being perpetrated on Cytodyn at the time of its complaint.
But that is not the sole reason the stock can’t preserve some upward momentum.
The company has been selling inventory privately at ridiculously low prices, to the stage where by one wonders just who exactly are the lucky winners of what amounts to no cost millions of dollars?
Moreover, starting within the month of November 2020 as well as for every one of the following five (five) calendar months thereafter, the Company is actually obligated to lower the outstanding harmony 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 monthly Debt Reduction Amount. The Debt Reduction Amount payments are not be subject to the fifteen % prepayment premium.
Also detracting from the business’s gloss is the propensity of managing for endlessly marketing communications with shareholders. During an investor webcast on January 5th, the business had a series of audio testimonials from people making use of PRO 140 for HIV treatment, backed by tear jerking music, and therefore replete with emotional language devoid of data.
Even worse, the company’s phone number at the bottom level of press releases includes an extension for Mike Mulholland, the CFO, and Nader Pourhassan, the CEO, but neither one is a “valid extension” according to the automatic system.
That is the sort of approach that the FDA and SEC view unfavourably, and is likely at the very least in part the reason behind the continued underdog status of theirs at both agencies.
The company has also come to be unresponsive to requests for interviews, and so using the story coming out less than merely these ill advised publicity stunts, shorts are attracted, and huge cash investors, alienated.
But think of this “management discount” as the chance to purchase a sizable role (should someone be so inclined) contained what may very well turn out to be, in a matter of weeks, given that the best therapy for serious COVID19 associated illness.
I expect the data in the trial now concluded for just such an indication can launch the company into a complete new valuation altitude that will allow it to overcome these shortfalls.
Average trading volume is actually steady above 6 million shares a day, and before the conclusion of this week, we will find out exactly how effective leronlimab/PRO 140/Vyrologix is actually for saving lives from the most severe of COVID nineteen. In case the outcomes are positive, this may be a significant winner.
Cytodyn Inc (OTCMKTS:CYDY)