Cytodyn (CYDY) Phase 2b/3 Trial Results Expected Any Day
Cytodyn Inc (OTCMKTS:CYDY), a late-stage biotech drug designer, has already shipped a win for Wealthpress subscribers from our 1st feature back in April this year. Billions have been invested into hundreds of biotechs all competing to create a medicine or therapy for severe COVID 19 instances that trigger death, and none have been successful. Except Cytodyn, if early indications are established in the present trial now underway.
But right after a serious jump on the business’s monetary claims and SEC filings, an image emerges of business management working who have a “toxic lender” to direct seriously discounted shares to the lender regularly. An investment in Cytodyn is actually a strictly speculative bet on the part of mine, and when the anticipated upward price movement does not appear following results in the company’s period 2b/3 trial for severe-to-critical COVID 19, I will exit the investment.
In case the business’s drug does actually reliably save lifestyles to come down with severe-to-critical COVID19 individuals, subsequently a groundswell of investor support can force the business into completely new, higher-grade 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 actually creating therapies based on a monoclonal antibody called “leronlimab”, technically referred to as “humanized IgG4, monoclonal antibody (mAb) to the C C chemokine receptor sort 5 (CCR5)”. This particular engineered antibody was obtained 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 5 % net royalty on commercial sales.
The drug was acquired on its first promise as an HIV therapy, for which continued research and development by Cytodyn has highlighted the capability to reduce regular drug cocktails with assortment pills right into an individual monthly injection, in some instances, with zero 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 impact on the CCR5 receptor has extremely optimistic therapeutic implications for everything out of certain stable tumours to NASH (Non alcoholic steatohepatitis), the liver function disorder which afflicts up to twelve percent of the US public, and up to 26 % globally.
But the real emergent and likely transformational application for leronlimab, as stated at the beginning, (which is currently getting 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 apparently blocks the CCR5 receptor from over-responding to the virus as well as launching the today household-word “cytokine storm”. Some proportion of people obviously return from the brink following two treatments (and in some cases, one treatment) of leronlimab, even if intubated.
The company finished enrollment of a stage 2b/3 trial on December 15 to “evaluate the efficacy and safety of leronlimab for clients with severe-to-critical COVID-19 indications is actually a two arm, placebo controlled, double blind, randomized, adaptive design and style multicenter study,” according to 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 high therapy for ARDS.
Cytodyn Inc (OTCMKTS:CYDY)
While the vaccines that are now spreading are definitely lending hope for a normalization of society by mid-2021, the surging global rates of illness suggest the immediate future is already overwhelming health care systems across the world as a lot more men and women require utilization of Intensive Care Unit hospitalization.
During my 1st interview with Dr. Nader Pourhassan back contained March of 2020, his extreme enthusiasm for the prospects of this drug’s effectiveness was apparent.
It was before the now raging second wave had gathered steam, as well as he was then discovering individuals who were receiving leronlimab under the FDA’s Emergency Investigative New Drug exemption.
At the time, although, this small independent biotech without any major funding and a decidedly unfortunate public listing on the naked short-sellers’ dream OTC marketplace was getting prepared to apply for a listing on NASDAQ, along with the deck was stacked from it.
Full Disclosure: I posses 10,000 shares at 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 flexible drug. To them, a vaccine is practically pointless.
This particular drug has “blockbuster potential” authored all over it.
With 394 people enrolled inside the Phase 2b/3 trial as of December 16, and initially data expected this week, any demonstrable consistency in the data is going to record the world’s interest in probably the most profound way. Quick sellers may be swept aside (at the very least temporarily) simply because company’s brand new share price amounts qualify it for NASDAQ listing.
Cytodyn management says it has 700,000 doses ready for sale right now, with an additional 2.5 million purchased for each of 2021 and 2022 in a manufacturing understanding with Samsung, as per its CEO.
The Downside
so if leronlimab/PRO 140/Vyrologix is very great, why the stock’s been trapped in sub 1dolar1 five penny stock purgatory for such a long time?
The fast remedy is “OTC”.
Apart from struggling with a share price under $3, the company hasn’t been in a position to meet and keep certain different quantitative prerequisites, including positive shareholders’ equity with a minimum of $5 million.
But in the NASDAQ world, you can find non-quantifiable behaviours by businesses that can cause waiting times to NASDAQ listings. Overtly promotional communications are actually among such criteria that will never result in a refusal letter…nor a NASDAQ listing.
More importantly, Cytodyn has additionally not been able to access capital under standard ways, thanks to its being mentioned on the OTC, along with thus un-attractive on that foundation alone to white colored shoe firms.
Thus, they have been cut down to accepting shareholder-hostile OID debentures with unsightly conversion terms that create a short-seller’s damp dream.
In November, they coppied 28.5 huge number of out of Streeterville Capital of which just twenty five dolars million was given to the company; $3.4 huge number of will be the discount the Streeterville sections, and $100k is actually set aside to protect the expenditures. Streeterville is actually associated with Illiad Research and Trading, that is controlled by John Fife of Chicago Ventures Inc. Iliad has been referred to as a “legendary so-called poisonous lender”, by rival studies firm Utopia Capital Research.
Cytodyn Inc (OTCMKTS:CYDY)
Under the phrases of the deal, Cytodyn has to pay again $7.5 million each month. If they don’t have the cash, they spend in stock; many lately, within a sales cost of $3.40 a share.
Now just imagine when you are an opportunistic low rent lender and you have received a certain 2.2 million shares coming your way in the very first week of every month. Any price tag above the sales price is pure profit. Remember – this guy isn’t an investor; he is a lender.
He is not operating on the hope that Cytodyn stock could go parabolic if leronlimab is deemed a remedy for ARDS; his online business model is to limit risk and maximize upside via discounted conversion of share.
This’s the short seller’s wet dream I am talking about. Not merely is definitely the lender enticed to go brief, but any short trading bucket repair shop in town who could fog a mirror and go through an EDGAR filing realize that every month, like clockwork, there’s going to be two million+ shares striking the bid lowered by to $3.40.
The SEC is not impressed, and on September three, 2020, filed a criticism.
The Securities and Exchange Commission these days filed charges from John M. Fife of Chicago and Companies he controls for obtaining and selling much more than 21 billion shares of penny stock without any registering as a securities dealer with the SEC.
The SEC’s criticism, alleges that in between 2015 as well as 2020, Fife, and also the businesses of his, Chicago Venture Partners, L.P., Iliad Research and Trading, L.P., St. George Investments LLC, Tonaquint, Inc., and Typenex Co-Investment, LLC, routinely interested in the company of buying convertible paperwork from penny stock issuers, transforming those notes into shares of inventory at a big discount from the market cost, and selling the newly issued shares to the marketplace at a substantial profit. The SEC alleges that Fife and his companies involved in over 250 sports convertible transactions with approximately 135 issuers, sold greater than 21 billion newly-issued penny stock shares to the industry, and obtained more than sixty one dolars million in earnings.
Streeterville Capital isn’t mentioned as an entity of the complaint. Which suggests it was likely used by Cytodyn as well as Fife to avoid detection by the SEC that this same scheme was getting perpetrated on Cytodyn at the time of the complaint of its.
But that is not the only reason the stock can’t observe any upward momentum.
The company has been selling stock privately from ridiculously low prices, to the stage where one wonders just that exactly are the lucky winners of what amounts to no cost millions of dollars?
To wit:
Additionally, starting in the month of November 2020 as well as for every one of the following 5 (5) calendar days thereafter, the Company is actually obliged to bring down the excellent balance of the Note by $7,500,000 per month (the “Debt Reduction Amount”). Payments the Company makes under the Prior Notes are going to be credited toward 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 shine is the propensity of handling for endlessly marketing communications with shareholders. During an investor webcast on January 5th, the company had a number of sound testimonials from people using PRO 140 for HIV treatment, backed by tear-jerking music, and replete with mental language devoid of information.
Worse, the company’s mobile phone number at the bottom level of press releases comes with an extension for Nader Pourhassan, the CFO, and Mike Mulholland, the CEO, but neither one is actually a “valid extension” based on the automatic phone system.
That is the sort of approach that the SEC and FDA view unfavourably, and is likely at the very least in part the reason for the continued underdog status of theirs at both agencies.
The company has also become unresponsive to requests for interview, and therefore 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 “management discount” as the ability to acquire a sizable job (should someone be so inclined) in what could really well turn out to be, in a question of weeks, since the top treatment for severe COVID19 related illness.
I expect the details from your trial now concluded for only such an indication can release the company into a complete new valuation altitude that will allow it to overpower these shortfalls.
Average trading volume is constant above 6 million shares 1 day, and right before the conclusion of this week, we will learn just how effective leronlimab/PRO 140/Vyrologix is actually for saving lives from the most severe of COVID 19. In case the results are positive, this may be a huge winner.
Cytodyn Inc (OTCMKTS:CYDY)