Cytodyn (CYDY) Phase 2b/3 Trial Results Expected Any Day
Cytodyn Inc (OTCMKTS:CYDY), a late-stage biotech drug developer, has already shipped a win for Wealthpress subscribers from our first feature returned in April this year. Billions have been invested directly into a huge selection of biotechs all competing to create a medicine or therapy for serious COVID-19 situations that trigger death, and also none have succeeded. Except for Cytodyn, if early indications are verified in the current trial now underway.
But right after a serious plunge on the business’s financial claims and SEC filings, a picture emerges of company control operating with a “toxic lender” to funnel seriously discounted shares to the lender frequently. An investment in Cytodyn is actually a strictly speculative bet on the part of mine, and if the anticipated upward price movement doesn’t manifest 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 company’s drug does actually reliably spend less lifestyles in danger of severe-to-critical COVID19 patients, then a groundswell of investor support can drive the company into completely new, higher-grade relationships, which would permit 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 actually developing therapies used on a monoclonal antibody called “leronlimab”, technically referred to as “humanized IgG4, monoclonal antibody (mAb) to the C-C chemokine receptor type 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 expense of acquisition amounts to ten dolars million and a five % net royalty on business revenue.
The drug was acquired on the first promise of its as an HIV treatment, for which continued development as well as research by Cytodyn has shown the capability to reduce daily drug cocktails with assortment pills right 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 then, Cytodyn’s scientific team has realized the antibody’s effect on the CCR5 receptor has extremely positive therapeutic implications for everything from certain solid tumours to NASH (Non alcoholic steatohepatitis), the liver feature condition that afflicts up to 12 % of the US public, and up to twenty six % globally.
But the real emergent and potentially transformational program for leronlimab, as stated at the beginning, (which is currently getting branded as Vyrologix by Cytodyn), is for the Acute Respiratory Distress Syndrome (ARDS) due to COVID 19 that precludes the Sequential Organ Failure in fatal situations of COVID infections.
Leronlimab evidently blocks the CCR5 receptor from over responding to the virus and also launching the now household word “cytokine storm”. Some proportion of individuals apparently return from the brink following two treatments (and in some instances, one treatment) of leronlimab, still when intubated.
The company completed enrollment of a level 2b/3 trial on December 15 to “evaluate the efficacy as well as safety of leronlimab for clients with severe-to-critical COVID 19 indications is actually a two-arm, placebo controlled, double blind, randomized, adaptive design multicenter study,” according to the company’s media release.
This trial phase concluded on January 12 ish, and if the outcomes are good, this can make leronlimab a top remedy for ARDS.
Cytodyn Inc (OTCMKTS:CYDY)
Although the vaccines that are now circulating are surely lending hope for a normalization of society by mid 2021, the surging global rates of infection mean the immediate future is right now overwhelming health care systems throughout the world as increasingly more individuals require ability to access Intensive Care Unit hospitalization.
During my first job interview with Dr. Nader Pourhassan back in March of 2020, his extreme enthusiasm for the prospects of the drug’s effectiveness was apparent.
This was before the currently raging next trend had gathered vapor, and he was then noticing individuals who were getting leronlimab under the FDA’s Emergency Investigative New Drug exemption.
At the time, although, this little independent biotech with no significant 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, and the deck was stacked from it.
Full Disclosure: I own 10,000 shares from an average expense of $6.23
Even though the world concentrates breathlessly on the hope for the latest vaccine to regain the social liberties of theirs, the 10 ish percentage of COVID infectees who descend into the cytokine storm driven ARDS actually have their lives saved by this apparently versatile drug. For these people, a vaccine is basically pointless.
This drug has “blockbuster potential” written all over it.
With 394 individuals enrolled in the Phase 2b/3 trial as of December sixteen, in addition to initially data expected this week, any demonstrable consistency in the data is going to capture the world’s interest in likely the most profound way. Short sellers might be swept apart (at least temporarily) while the company’s new share price amounts qualify it for NASDAQ listing.
Cytodyn management says it has 700,000 doses ready for sale right now, with an extra 2.5 huge number of purchased for each of 2021 and 2022 in a manufacturing understanding with Samsung, according to its CEO.
so if leronlimab/PRO 140/Vyrologix is so great, why the stock’s been trapped in sub 1dolar1 five penny stock purgatory for so long?
The fast remedy is “OTC”.
Besides dealing with a share price under $3, the company has not been equipped to meet and keep certain different quantitative requirements, including good shareholders’ equity with a minimum of five dolars million.
But in the NASDAQ community, you can find non-quantifiable behaviours by businesses that can cause slow downs to NASDAQ listings. Overtly promotional communications are actually among these kinds of criteria that will never result in a refusal letter…nor a NASDAQ listing.
More to the point, Cytodyn has also not been in a position to access capital under conventional ways, because of its being listed on the OTC, in addition to thus un attractive on that foundation alone to white colored shoe firms.
So, they have been cut down to accepting shareholder hostile OID debentures with unsightly conversion terms that generate a short-seller’s damp dream.
In November, they borrowed 28.5 zillion from Streeterville Capital of that just twenty five dolars million was given to the company; $3.4 zillion will be the discount the Streeterville pockets, and $100k is set aside to protect the expenses. Streeterville is actually related with Illiad Research and Trading, that is operated by John Fife of Chicago Ventures Inc. Iliad has been termed as a “legendary so called poisonous lender”, by rival research tight Utopia Capital Research.
Cytodyn Inc (OTCMKTS:CYDY)
Under the terms of the deal, Cytodyn must pay again $7.5 million every month. In case they do not possess the cash, they pay in stock; many recently, within a sales cost of $3.40 a share.
Now just imagine when you’re an opportunistic low-rent lender and you have got a certain 2.2 million shares coming the way of yours in the first week of every month. Any cost above the sales expenditure is pure profit. Remember – this guy is not an investor; he’s a lender.
He is not operating on the expectation that Cytodyn stock may go parabolic if leronlimab is deemed a cure for ARDS; the online business model of his is limiting risk and maximize upside through discounted transformation of share.
This’s the short seller’s wet dream I am speaking about. Not merely is the lender enticed to go brief, but some short-trading bucket shop in town who are able to fog a mirror and read an EDGAR filing realize that every month, like clockwork, there is going to be 2 million+ shares hitting the bid lowered by to $3.40.
The SEC isn’t impressed, additionally, on September 3, 2020, filed a complaint.
The Securities and Exchange Commission today filed charges against John M. Fife of Companies and Chicago he controls for acquiring and promoting much more than 21 billion shares of penny stock without any registering as a securities dealer using the SEC.
The SEC’s criticism, alleges that between 2015 as well as 2020, Fife, as well as 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, regularly interested in the business of purchasing convertible paperwork from penny stock issuers, transforming the notes into shares of inventory at a major discount from the market price, and offering the newly issued shares into the market at a substantial profit. The SEC alleges that Fife as well as his businesses interested in more than 250 sports convertible transactions with around 135 issuers, sold greater than 21 billion newly issued penny stock shares to the industry, and obtained more than $61 million in profits.
Streeterville Capital isn’t mentioned as an entity of the complaint. Which implies that it was probably applied by Cytodyn and Fife to stay away from detection by the SEC this same scheme was getting perpetrated on Cytodyn within the time of the complaint of its.
But that is not the only reason the stock cannot maintain some upward momentum.
The company has been selling stock privately from ridiculously minimal prices, to the position in which one wonders just that exactly are the lucky winners of what requires free millions of dollars?
Additionally, beginning inside the month of November 2020 as well as for each of the second five (5) calendar days thereafter, the Company is required to cut down the outstanding balance with the Note by $7,500,000 a month (the “Debt Reduction Amount”). Payments the Company makes within the Prior Notes will be acknowledged to the transaction of each monthly Debt Reduction Amount. The Debt Reduction Amount payments are not be subject to the fifteen % prepayment premium.
Additionally detracting from the company’s shine is the propensity of management for excessively marketing communications with shareholders. During an investor webcast on January 5th, the business had a compilation of audio testimonials from people applying PRO 140 for HIV treatment, backed by tear-jerking music, and replete with mental language devoid of data.
Even worse, the company’s cell phone number at the bottom of press releases includes an extension for Mike Mulholland, the CFO, and Nader Pourhassan, the CEO, but neither one particular is a “valid extension” based on the automated phone system.
That is the kind of approach that the FDA and SEC view unfavourably, and it is likely at minimum in part the reason behind the continued underdog status of theirs at both agencies.
The company has also 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 big money investors, alienated.
But think of this particular “management discount” as the chance to acquire a sizable job (should someone be so inclined) found what may very well turn out to be, in a question of weeks, since the leading therapy for serious COVID19 related illness.
I expect the data in the trial now concluded for only such a sign could release the business into a complete new valuation altitude that will permit it to overcome these shortfalls.
Average trading volume is actually continuous above 6 million shares a day, and before the tail end of this week, we will find out precisely how effective leronlimab/PRO 140/Vyrologix is actually for saving lives from the most severe of COVID nineteen. In case the results are positive, this could be a big winner.
Cytodyn Inc (OTCMKTS:CYDY)