Cytodyn (CYDY) Phase 2b/3 Trial Results Expected Any Day
Cytodyn Inc (OTCMKTS:CYDY), a late-stage biotech drug creator, has already delivered a win for Wealthpress subscribers from our first feature returned in April this year. Billions have been invested straight into hundreds of biotechs all competing to produce a cure or perhaps therapy for serious COVID 19 instances that result in death, and none have been successful. Except for Cytodyn, if early indications are confirmed in the present trial now underway.
But after a serious plunge on the business’s monetary statements and SEC filings, an image emerges of business management working with a “toxic lender” to direct severely discounted shares to the lender regularly. An investment in Cytodyn is a purely speculative bet on the part of mine, and if the anticipated upward price movement doesn’t manifest following results of the company’s period 2b/3 trial for severe-to-critical COVID 19, I will exit the investment.
In case the company’s drug does actually reliably preserve life in severe-to-critical COVID19 individuals, then a groundswell of investor assistance could drive the organization into completely new, higher-grade relationships, which would allow for the redemption of debentures and elimination of reliance on fly-by-night financings such as those described below.
Cytodyn’s sole focus is actually developing remedies 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 of Progenics Pharmaceuticals as “PRO 140”, a recently acquired subsidiary of Lantheus Holdings Inc (NASDAQ:LNTH), back in 2012.
Total price of acquisition amounts to $10 million and a five % net royalty on commercial revenue.
The drug was acquired on its first promise as an HIV therapy, for which continued development and research by Cytodyn has shown the potential to reduce regular drug cocktails with myriad pills right into a specific monthly injection, in some instances, with zero adverse reactions. To day, the FDA has denied Cytodyn’s Biologics License Application (BLA)
Since that time, Cytodyn’s scientific staff has discovered the antibody’s impact on the CCR5 receptor has extremely optimistic therapeutic implications for everything from certain solid tumours to NASH (Non alcoholic steatohepatitis), the liver function ailment that afflicts up to twelve % of the US population, and up to 26 % globally.
But the real emergent and likely transformational application for leronlimab, as I have said at the start, (which is now being branded as Vyrologix by Cytodyn), is made for the Acute Respiratory Distress Syndrome (ARDS) caused by COVID-19 which precludes the Sequential Organ Failure wearing fatal cases of COVID infections.
Leronlimab apparently blocks the CCR5 receptor from over-responding to the virus and launching the now household word “cytokine storm”. Some proportion of clients evidently return from the brink following two treatments (and in a number of cases, one treatment) of leronlimab, even if 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,” based on the company’s media release.
This trial period concluded on January 12 ish, and if the results are good, this will make leronlimab a top remedy for ARDS.
Cytodyn Inc (OTCMKTS:CYDY)
While the vaccines which are now dispersing are certainly lending optimism for a normalization of modern society by mid 2021, the surging worldwide rates of contamination suggest the immediate future is right now overwhelming health care systems throughout 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 back contained March of 2020, his extreme interest for the prospects of this drug’s efficacy was apparent.
It was prior to the now raging second wave had gathered heavy steam, as well as he was then seeing patients that were getting leronlimab under the FDA’s Emergency Investigative New Drug exemption.
Within the time, though, this small independent biotech without any significant funding and a decidedly unfortunate public listing on the naked short-sellers’ dream OTC marketplace was getting ready to put on for a listing on NASDAQ, as well as the deck was stacked against it.
Full Disclosure: I have 10,000 shares from an average cost of $6.23
Although the planet focuses breathlessly on the optimism for a new vaccine to regain their social liberties, the 10-ish fraction of COVID infectees that descend into the cytokine storm driven ARDS actually have their day saved by this seemingly versatile drug. For them, a vaccine is basically useless.
This particular drug has “blockbuster potential” written all over it.
With 394 patients enrolled in the Phase 2b/3 trial as of December 16, and first data expected this week, any demonstrable consistency in the details will capture the world’s interest in likely the most profound way. Quick sellers may be swept aside (at the very least temporarily) while 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 extra 2.5 zillion purchased for each of 2021 as well as 2022 in a manufacturing agreement with Samsung, as per its CEO.
so if leronlimab/PRO 140/Vyrologix is so great, why the stock’s been stuck in sub 1dolar1 five penny stock purgatory for so very long?
The quick remedy is “OTC”.
Besides struggling with a share price under three dolars, the company hasn’t been able to meet and maintain certain different quantitative requirements, like good shareholders’ equity with a minimum of five dolars million.
But in the NASDAQ community, there are non-quantifiable behaviours by organizations that cause delays to NASDAQ listings. Overtly promotional communications are among such criteria that will never result in a refusal letter…nor a NASDAQ listing.
Most importantly, Cytodyn has additionally not been able to access capital under standard ways, thanks to its being mentioned on the OTC, in addition to therefore un attractive on that basis alone to white colored shoe firms.
Thus, they’ve been reduced to accepting shareholder-hostile OID debentures with ugly conversion terms that produce a short-seller’s wet dream.
In November, they coppied 28.5 million from Streeterville Capital of that only twenty five dolars million was given to the company; $3.4 huge number of is the discount the Streeterville areas, and $100k is set aside to protect the expenses. Streeterville is related with Illiad Research and Trading, which is operated by John Fife of Chicago Ventures Inc. Iliad has been termed as a “legendary so called poisonous lender”, by rival research firm Utopia Capital Research.
Cytodyn Inc (OTCMKTS:CYDY)
Under the phrases of the deal, Cytodyn needs to pay back again $7.5 million a month. If they don’t possess the cash, they spend inside stock; most lately, within a sales cost of $3.40 a share.
These days just imagine when you are an opportunistic low rent lender and you’ve gained a certain 2.2 million shares coming the way of yours in the first week of each month. Any cost above the conversion price is pure profit. Remember – this guy is not an investor; he is a lender.
He is not operating on the expectation that Cytodyn stock could go parabolic if leronlimab is deemed a remedy for ARDS; his online business model is limiting risk and optimize upside via affordable transformation of share.
This’s the brief seller’s wet dream I am speaking about. Not merely would be the lender enticed to go brief, but some short trading bucket shop in town who could fog a mirror and go through an EDGAR filing understand that every month, like clockwork, there is going to be 2 million+ shares impacting the bid down to $3.40.
The SEC isn’t impressed, and on September 3, 2020, filed a criticism.
The Securities as well as Exchange Commission nowadays filed charges against John M. Fife of Companies and Chicago he controls for acquiring as well as marketing much more than 21 billion shares of penny inventory without registering as a securities dealer with the SEC.
The SEC’s criticism, alleges that in between 2015 and 2020, Fife, and his businesses, Chicago Venture Partners, L.P., Iliad Research and Trading, L.P., St. George Investments LLC, Tonaquint, Inc., and Typenex Co Investment, LLC, routinely engaged in the company of buying sports convertible paperwork from penny stock issuers, transforming those notes into shares of stock at a big discount from the market price, and offering the newly issued shares to the marketplace at a significant profit. The SEC alleges that Fife as well as the businesses of his involved in around 250 convertible transactions with about 135 issuers, sold more than twenty one billion newly-issued penny stock shares into the market, and obtained greater than $61 million in earnings.
Streeterville Capital is not stated as an entity of the complaint. Which suggests it was probably applied by Fife as well as Cytodyn to avoid detection by the SEC this very same scheme was getting perpetrated on Cytodyn within the time of the complaint of its.
But that is not the sole reason the stock cannot preserve some upward momentum.
The company has been offering stock privately from ridiculously minimal prices, to the point in which one wonders just who exactly are the blessed winners of what amounts to free millions of dollars?
Furthermore, beginning within the month of November 2020 and also for every one of the second 5 (5) calendar days thereafter, the Company is required to cut down the exceptional sense of balance of the Note by $7,500,000 per month (the “Debt Reduction Amount”). Payments the Company makes under the Prior Notes will be credited to the payment of each month Debt Reduction Amount. The Debt Reduction Amount payments aren’t be subject to the fifteen % prepayment premium.
Also detracting from the company’s gloss is the propensity of handling for excessively promotional communications with shareholders. During an investor webcast on January 5th, the company played a series of audio testimonials from people applying PRO 140 for HIV treatment, backed by tear jerking music, and therefore replete with emotional language devoid of information.
Even worse, the company’s telephone number at the bottom of press releases comes with an extension for Mike Mulholland, the CFO, and Nader Pourhassan, the CEO, but neither one is actually a “valid extension” based on the automated phone system.
That’s the type of approach that the FDA and SEC view unfavourably, and is likely at minimum in part the reason behind their continued underdog status at both agencies.
The company has additionally turned out to be unresponsive to requests for interview, and therefore using the story coming out under only these ill-advised publicity stunts, shorts are actually attracted, and big cash investors, alienated.
But think of this particular “management discount” as the opportunity to buy a sizable position (should someone be so inclined) contained what might very well prove to be, in a question of weeks, given that the leading therapy for serious COVID19 associated illness.
I expect the data from your trial now concluded for just such an indication might release the company into a complete new valuation altitude that will permit it to overcome these shortfalls.
Average trading volume is steady above six million shares a day, and right before the tail end of this week, we’ll learn just how effective leronlimab/PRO 140/Vyrologix is at saving lives from the most severe of COVID nineteen. If the results are good, this may be a significant winner.
Cytodyn Inc (OTCMKTS:CYDY)