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 members from our 1st feature back in April this year. Billions have been invested into hundreds of biotechs all competing to create a medicine or perhaps therapy for severe COVID-19 instances which cause death, and also none have succeeded. Except Cytodyn, when early indications are verified in the current trial now underway.
But after a deep plunge on the business’s monetary statements and SEC filings, a picture emerges of business management operating with a “toxic lender” to direct severely discounted shares to the lender frequently. An investment in Cytodyn is a strictly speculative bet on my part, of course, if the expected upward price movement doesn’t occur following results in the company’s period 2b/3 trial for severe-to-critical COVID-19, I will exit the investment.
If the company’s drug does actually reliably preserve lifestyles in severe-to-critical COVID19 patients, then a groundswell of investor assistance could drive the business into new, higher-grade human relationships, which would allow for the redemption of elimination and debentures of reliance on fly-by-night financings like those described below.
Cytodyn’s sole focus is creating treatments used on a monoclonal antibody known as “leronlimab”, technically referred to 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), again in 2012.
Total cost of acquisition amounts to $10 million plus a 5 % net royalty on business revenue.
The drug was acquired on the first promise of its as an HIV treatment, for which continued development and research by Cytodyn has demonstrated the ability to reduce daily drug cocktails with assortment pills right into a single monthly injection, in some cases, with 0 unwanted side effects. To day, the FDA has denied Cytodyn’s Biologics License Application (BLA)
Since then, Cytodyn’s scientific staff has realized the antibody’s effect on the CCR5 receptor has incredibly positive therapeutic implications for everything out of certain solid tumours to NASH (Non alcoholic steatohepatitis), the liver function condition that afflicts up to twelve percent of the US public, and up to twenty six % globally.
But the real emergent and potentially transformational program for leronlimab, as I have said at the start, (which is now being branded as Vyrologix by Cytodyn), is for the Acute Respiratory Distress Syndrome (ARDS) brought on by 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 patients evidently return from the brink following 2 treatments (and in a number of 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 and safety of leronlimab for patients with severe-to-critical COVID 19 indications is a two arm, placebo controlled, double blind, randomized, adaptive design and style multicenter study,” according to the company’s media release.
This trial period concluded on January 12-ish, and if the results are good, this can make leronlimab a high treatment for ARDS.
Cytodyn Inc (OTCMKTS:CYDY)
Even though the vaccines which are presently circulating are definitely lending optimism for a normalization of modern society by mid 2021, the surging global rates of illness mean the immediate future is today overwhelming health care systems across the world as a lot more individuals require ability to access Intensive Care Unit hospitalization.
During my first job interview with Dr. Nader Pourhassan back in March of 2020, the serious eagerness of his for the prospects of this drug’s success was evident.
It was prior to the now raging next trend had gathered vapor, and he was then discovering individuals which were getting leronlimab underneath the FDA’s Emergency Investigative New Drug exemption.
At the time, though, this small independent biotech with no big funding and a decidedly unhappy public listing on the naked short-sellers’ fantasy OTC marketplace was getting able to apply for a listing on NASDAQ, along with the deck was stacked from it.
Full Disclosure: I have 10,000 shares from an average price of $6.23
Although the planet focuses breathlessly on the hope for a new vaccine to restore their social liberties, the 10 ish portion of COVID infectees that descend into the cytokine storm-driven ARDS literally have their lives saved by this apparently versatile drug. For them, a vaccine is pretty much pointless.
This drug has “blockbuster potential” written all over it.
With 394 people enrolled with the Phase 2b/3 trial as of December sixteen, in addition to first information expected this week, any demonstrable consistency in the information is going to capture the world’s focus in essentially the most profound way. Quick sellers may be swept aside (at the very least temporarily) while the company’s new share priced levels qualify it for NASDAQ listing.
Cytodyn management says it has 700,000 doses ready for sale right now, with an additional 2.5 huge number of purchased for each of 2021 and 2022 in a manufacturing agreement with Samsung, based on 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 such a long time?
The speedy remedy is “OTC”.
Besides struggling with a share price under three dolars, the company hasn’t been in a position to meet and maintain some other quantitative prerequisites, like positive shareholders’ equity with a minimum of five dolars million.
But in the NASDAQ community, one 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 which will never cause a refusal letter…nor a NASDAQ listing.
More to the point, Cytodyn has additionally not been able to access capital under traditional ways, thanks to its being listed on the OTC, and thus un-attractive on that basis alone to white colored shoe firms.
And so, they’ve been lowered to accepting shareholder-hostile OID debentures with unsightly conversion terms that produce a short-seller’s wet dream.
In November, they borrowed 28.5 million from Streeterville Capital of which just twenty five dolars million was given to the company; $3.4 million will be the discount the Streeterville pockets, and $100k is actually reserved to cover the bills. Streeterville is actually linked with Illiad Research and Trading, which is operated by John Fife of Chicago Ventures Inc. Iliad has been called a “legendary so called toxic lender”, by rival research firm Utopia Capital Research.
Cytodyn Inc (OTCMKTS:CYDY)
Under the phrases of the deal, Cytodyn wants to pay back again $7.5 million every month. If they do not possess the cash, they spend inside stock; the majority of recently, at a conversion price of $3.40 a share.
These days just imagine when you’re an opportunistic low-rent lender and you have got a guaranteed 2.2 million shares coming your way in the first week of every month. Any price above the sales cost is pure profit. Remember – this guy isn’t an investor; he is 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 to limit risk and maximize upside via affordable transformation of share.
This is the quick seller’s wet dream I’m talking about. Not only would be the lender enticed to go brief, but any short trading bucket shop in town who can fog a mirror and read an EDGAR filing realize that each month, like clockwork, there’s going to be 2 million+ shares hitting the bid down to $3.40.
The SEC isn’t impressed, and on September three, 2020, filed a complaint.
The Securities in addition to the Exchange Commission nowadays filed charges against John M. Fife of Chicago and Companies he controls for obtaining as well as selling much more than 21 billion shares of penny inventory without any registering to be a securities dealer with the SEC.
The SEC’s criticism, alleges this between 2015 as well as 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., and Typenex Co-Investment, LLC, routinely interested in the business of purchasing sports convertible notes from penny stock issuers, transforming those notes into shares of stock at a big discount from the market price, and selling the newly issued shares to the marketplace at a significant profit. The SEC alleges which Fife as well as his companies involved in around 250 convertible transactions with approximately 135 issuers, sold more than 21 billion newly-issued penny stock shares into the market, and obtained greater than $61 million in profits.
Streeterville Capital is not stated as an entity of the complaint. Which suggests that it was very likely applied by Fife as well as Cytodyn to stay away from detection by the SEC that this very same scheme was getting perpetrated on Cytodyn at the time of the complaint of its.
But that’s not the sole reason the stock can’t observe some upward momentum.
The company has been offering inventory privately from ridiculously low prices, to the position where one wonders just who exactly are the fortunate winners of what amounts to no cost millions of dollars?
Additionally, starting inside the month of November 2020 as well as for each of the following five (5) calendar months thereafter, the Company is obligated to reduce the exceptional balance with the Note by $7,500,000 a month (the “Debt Reduction Amount”). Payments the Company makes within the Prior Notes are going to be credited to the transaction of each month 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 managing for excessively marketing communications with shareholders. During an investor webcast on January 5th, the business played a number of sound testimonials from people using PRO 140 for HIV treatment, backed by tear-jerking music, and then replete with emotional language devoid of data.
Worse, the company’s phone number at the bottom part of press releases includes an extension for Mike Mulholland, the CFO, and Nader Pourhassan, the CEO, but neither one particular is 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 least 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 big cash investors, alienated.
But think of this particular “management discount” as the opportunity to buy a sizable job (should one be so inclined) found what could very well prove to be, in a question of weeks, since the best therapy for serious COVID19 related illness.
I expect the information in the trial now concluded for just such an indication might launch the organization into a whole new valuation altitude that will permit it to get over these shortfalls.
Average trading volume is actually constant above six million shares one day, and right before the tail end of this week, we’ll find out exactly how efficient leronlimab/PRO 140/Vyrologix is actually for saving lives from the most severe of COVID 19. If the results are good, this can be a big winner.
Cytodyn Inc (OTCMKTS:CYDY)