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 members from our first feature returned in April this season. Billions have been invested into hundreds of biotechs all competing to produce a cure or perhaps therapy for severe COVID 19 instances that trigger death, and none have succeeded. Except for Cytodyn, when early indications are verified in the present trial now underway.
But right after a serious dive on the business’s financial claims and SEC filings, a picture emerges of business control operating who have a “toxic lender” to funnel severely discounted shares to the lender frequently. An investment in Cytodyn is a purely speculative bet on my part, and if the expected upward price movement doesn’t manifest following results of the company’s phase 2b/3 trial for severe-to-critical COVID-19, I will exit the investment.
If the company’s drug does in fact reliably save lifestyles to come down with severe-to-critical COVID19 individuals, subsequently a groundswell of investor support can drive the company into completely new, higher grade relationships, which would allow for the redemption of debentures as well as elimination of reliance on fly-by-night financings for example those discussed below.
Cytodyn’s sole focus is actually creating remedies based on a monoclonal antibody called “leronlimab”, technically called “humanized IgG4, monoclonal antibody (mAb) to the C-C chemokine receptor sort 5 (CCR5)”. This engineered antibody was purchased 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 plus a five % net royalty on commercial revenue.
The drug was acquired on the first promise of its as an HIV therapy, for which continued development as well as research by Cytodyn has demonstrated the potential to reduce regular drug cocktails with assortment pills right into an individual monthly injection, sometimes, with 0 adverse reactions. To particular date, the FDA has denied Cytodyn’s Biologics License Application (BLA)
Since then, Cytodyn’s scientific team has discovered the antibody’s influence on the CCR5 receptor has incredibly positive therapeutic implications for everything from certain solid tumours to NASH (Non-alcoholic steatohepatitis), the liver function condition which afflicts up to twelve percent of the US public, and up to 26 % globally.
But the real emergent also likely transformational application for leronlimab, as stated at the start, (which is currently getting branded as Vyrologix by Cytodyn), is designed for the Acute Respiratory Distress Syndrome (ARDS) caused by COVID 19 that precludes the Sequential Organ Failure in fatal instances of COVID infections.
Leronlimab it seems that 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 2 treatments (and in a number of cases, one treatment) of leronlimab, still if intubated.
The company finished enrollment of a level 2b/3 trial on December 15 to “evaluate the efficacy as well as safety of leronlimab for people with severe-to-critical COVID 19 indications is a two arm, placebo controlled, double blind, randomized, adaptive style multicenter study,” based on the company’s press release.
This trial period concluded on January 12 ish, and if the outcomes are good, this can make leronlimab a premier therapy for ARDS.
Cytodyn Inc (OTCMKTS:CYDY)
Even though the vaccines that are now diffusing are surely lending hope for a normalization of modern society by mid 2021, the surging worldwide rates of contamination mean the immediate future is today overwhelming health care systems across the world as a lot more individuals require utilization of Intensive Care Unit hospitalization.
During my first interview with Dr. Nader Pourhassan back contained March of 2020, his extreme interest for the prospects of the drug’s effectiveness was evident.
It was prior to the currently raging next trend had gathered steam, as well as he was then noticing individuals who were receiving leronlimab underneath the FDA’s Emergency Investigative New Drug exemption.
Within the time, although, this little independent biotech without any big funding along with a decidedly unfortunate public listing on the naked short-sellers’ fantasy OTC marketplace was getting ready to put on 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
While the planet focuses breathlessly on the optimism for the latest vaccine to regain the community 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 flexible drug. For these people, a vaccine is pretty much pointless.
This particular drug has “blockbuster potential” authored all over it.
With 394 individuals enrolled inside the Phase 2b/3 trial as of December sixteen, and initially information expected this week, any demonstrable consistency in the data will capture the world’s attention in essentially the most profound way. Short sellers could be swept aside (at the very least temporarily) while the business’s brand new share price levels qualify it for NASDAQ listing.
Cytodyn management says it’s 700,000 doses ready for sale now, with an extra 2.5 huge number of ordered for each of 2021 plus 2022 in a manufacturing arrangement with Samsung, as per its CEO.
so if leronlimab/PRO 140/Vyrologix is so great, why the stock’s been trapped in sub-1dolar1 5 penny stock purgatory for so very long?
The fast remedy is “OTC”.
Apart from struggling with a share price under $3, the company has not been in a position to meet and maintain some different quantitative requirements, like good shareholders’ equity that is at least five dolars million.
But in the NASDAQ community, you can find non-quantifiable behaviours by organizations that can cause waiting times to NASDAQ listings. Overtly promotional communications are actually among such criteria which will never cause a refusal letter…nor a NASDAQ listing.
More to the point, Cytodyn in addition has not been in a position to access capital under standard ways, because of its being listed on the OTC, in addition to consequently un attractive on that basis alone to white shoe firms.
So, they’ve been cut down to accepting shareholder-hostile OID debentures with ugly sales terms that generate a short-seller’s stormy dream.
In November, they took 28.5 huge number of from Streeterville Capital of which just twenty five dolars million was paid to the company; $3.4 zillion would be the discount the Streeterville areas, and $100k is actually set aside to protect the expenditures. Streeterville is actually associated with Illiad Trading and Research, that is managed 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 offer, Cytodyn has got to pay again $7.5 million per month. In case they don’t have the cash, they pay in stock; the majority of recently, at a conversion price of $3.40 a share.
Now consider when you are an opportunistic low rent lender and you have gained an assured 2.2 million shares coming your way in the first week of each month. Any price above the sales expenditure is pure profit. Remember – this guy is not an investor; he is a lender.
He’s 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 optimize upside via affordable conversion of share.
This is the quick seller’s wet dream I’m talking about. Not merely is definitely the lender enticed to go short, but some short-trading pail dealer in town who could fog a mirror and read an EDGAR filing understand 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, additionally, on September 3, 2020, filed a complaint.
The Securities in addition to the Exchange Commission these days filed charges against John M. Fife of Chicago and Companies he controls for acquiring as well as selling more than 21 billion shares of penny stock without any registering as a securities dealer with the SEC.
The SEC’s criticism, alleges this 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., as well as Typenex Co-Investment, LLC, routinely engaged in the business of purchasing convertible paperwork from penny stock issuers, converting those notes into shares of inventory at a major discount from the market cost, and selling the newly issued shares into the marketplace at a substantial profit. The SEC alleges that Fife as well as the businesses of his involved in more than 250 sports convertible transactions with approximately 135 issuers, sold greater than twenty one billion newly-issued penny stock shares to the industry, and obtained greater than $61 million in profits.
Streeterville Capital isn’t mentioned as an entity of the complaint. Which suggests it was very likely applied by Fife as well as Cytodyn to avoid detection by the SEC that this same scheme was getting perpetrated on Cytodyn at the time of its complaint.
But that is not the sole reason the stock cannot keep some upward momentum.
The company has been selling inventory privately at ridiculously low prices, to the point where one wonders just that exactly are the fortunate winners of what amounts to no cost millions of dollars?
Moreover, starting within the month of November 2020 as well as for each of the following 5 (5) calendar days thereafter, the Company is actually obliged to cut down the exceptional harmony 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 monthly Debt Reduction Amount. The Debt Reduction Amount payments aren’t be subject to the 15 % prepayment premium.
Also detracting from the business’s gloss is actually the propensity of management for excessively marketing communications with shareholders. During an investor webcast on January 5th, the business played a series of audio testimonials from people making use of PRO 140 for HIV treatment, backed by tear-jerking music, and replete with mental language devoid of data.
Worse, the company’s phone number at the bottom of press releases comes with an extension for Nader Pourhassan, the CFO, and Mike Mulholland, the CEO, but neither one particular is actually a “valid extension” according to the automated phone system.
That is the kind of approach that the SEC and FDA view unfavourably, and it is likely at minimum in part the reason for the continued underdog status of theirs at both agencies.
The company has also turned out to be unresponsive to requests for interview, and therefore using the story coming out under just these ill-advised publicity stunts, shorts are attracted, and big cash investors, alienated.
But think of this specific “management discount” as the chance to buy a sizable role (should a person be so inclined) found what may really well prove to be, in a matter of weeks, as the leading treatment for severe COVID19 related illness.
I expect the details from the trial now concluded for just such an indication might launch the company into a complete new valuation altitude that will enable it to overpower these shortfalls.
Average trading volume is constant above six million shares a day, and right before the end of this week, we’ll find out precisely how efficient leronlimab/PRO 140/Vyrologix is for saving lives from the worst of COVID 19. If the results are positive, this can be a big winner.
Cytodyn Inc (OTCMKTS:CYDY)