Cytodyn (CYDY) Phase 2b/3 Trial Results Expected Any Day
Cytodyn Inc (OTCMKTS:CYDY), a late-stage biotech drug developer, has already delivered a win for Wealthpress members from our first feature returned in April this year. Billions have been invested directly into countless biotechs all competing to make a medicine or maybe treatment for severe COVID-19 instances which cause death, as well as none have been successful. Except for Cytodyn, when early indications are verified in the current trial now underway.
But after a deep dive on the company’s fiscal statements as well as SEC filings, an image emerges of business management operating who have a “toxic lender” to funnel severely discounted shares to the lender frequently. An investment in Cytodyn is actually a strictly speculative bet on my part, of course, if the anticipated upward price movement does not occur after results in the company’s stage 2b/3 trial for severe-to-critical COVID 19, I will exit the investment.
In case the company’s drug does in fact reliably spend less lives in severe-to-critical COVID19 individuals, then a groundswell of investor assistance may push the business into completely new, higher-grade human relationships, which would permit for the redemption of debentures and elimination of reliance on fly-by-night financings for instance those discussed below.
Cytodyn’s sole focus is actually developing remedies used on a monoclonal antibody called “leronlimab”, technically called “humanized IgG4, monoclonal antibody (mAb) to the C C chemokine receptor sort five (CCR5)”. This engineered antibody was acquired from Progenics Pharmaceuticals as “PRO 140”, a recently acquired subsidiary of Lantheus Holdings Inc (NASDAQ:LNTH), back in 2012.
Total price of acquisition amounts to ten dolars million plus a 5 % net royalty on business sales.
The drug was acquired on its first promise as an HIV treatment, for which continued research as well as development by Cytodyn has demonstrated the capability to reduce regular drug cocktails with assortment pills into a specific monthly injection, in some cases, with zero unwanted side effects. To particular date, the FDA has denied Cytodyn’s Biologics License Application (BLA)
Since that time, Cytodyn’s scientific staff has discovered the antibody’s influence on the CCR5 receptor has extremely positive therapeutic implications for everything from some stable tumours to NASH (Non alcoholic steatohepatitis), the liver function disorder which afflicts up to twelve % of the US public, and up to twenty six % globally.
But the real emergent and potentially transformational program for leronlimab, as mentioned at the start, (which is now getting branded as Vyrologix by Cytodyn), is made for the Acute Respiratory Distress Syndrome (ARDS) due to COVID 19 that precludes the Sequential Organ Failure wearing fatal instances of COVID infections.
Leronlimab evidently prevents the CCR5 receptor from over-responding to the virus and launching the today household-word “cytokine storm”. Some proportion of patients apparently return from the brink following two treatments (and in some instances, 1 treatment) of leronlimab, even when intubated.
The company finished enrollment of a stage 2b/3 trial on December fifteen to “evaluate the efficacy as well as safety of leronlimab for individuals 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 period concluded on January 12-ish, and if the results are good, this will make leronlimab a premier treatment for ARDS.
Cytodyn Inc (OTCMKTS:CYDY)
Even though the vaccines that are now circulating are certainly lending optimism for a normalization of modern society by mid 2021, the surging global rates of infection mean the immediate future is today overwhelming health care systems around the world as a lot more folks call for utilization of Intensive Care Unit hospitalization.
During the 1st interview of mine with Dr. Nader Pourhassan back contained March of 2020, the extreme enthusiasm of his for the prospects of this drug’s efficacy was evident.
This was prior to the currently raging next wave had gathered steam, and he was then noticing patients which were receiving leronlimab underneath the FDA’s Emergency Investigative New Drug exemption.
At the time, even thought, this small independent biotech without any significant funding and a decidedly unhappy public listing on the naked short-sellers’ dream OTC marketplace was getting ready to utilize for a listing on NASDAQ, along with the deck was stacked against it.
Full Disclosure: I own 10,000 shares at an average price of $6.23
Even though the planet focuses breathlessly on the optimism for a new vaccine to regain the social liberties of theirs, the 10 ish fraction of COVID infectees that descend into the cytokine storm-driven ARDS actually have their day saved by this apparently versatile drug. For these people, a vaccine is practically pointless.
This particular drug has “blockbuster potential” written all over it.
With 394 clients enrolled inside the Phase 2b/3 trial as of December sixteen, and first information expected this week, any demonstrable consistency in the information is going to capture the world’s interest in likely the most profound way. Short sellers might be swept aside (at minimum temporarily) as the company’s brand new share priced amounts qualify it for NASDAQ listing.
Cytodyn management says it has 700,000 doses prepared for sale right now, with an additional 2.5 zillion ordered for each of 2021 plus 2022 in a manufacturing agreement with Samsung, as per its CEO.
really if leronlimab/PRO 140/Vyrologix is very great, why the stock’s been stuck in sub-1dolar1 five penny stock purgatory for such a long time?
The fast solution is “OTC”.
Apart from faced with a share price under three dolars, the company hasn’t been equipped to meet and keep some different quantitative requirements, like positive shareholders’ equity with a minimum of five dolars million.
But in the NASDAQ world, you can find non-quantifiable behaviours by organizations that cause delays to NASDAQ listings. Overtly promotional communications are among these kinds of criteria that will never lead to a refusal letter…nor a NASDAQ listing.
Most importantly, Cytodyn in addition has not been able to access capital under traditional means, thanks to its being listed on the OTC, and thus un-attractive on that basis alone to white shoe firms.
Thus, they have been reduced to accepting shareholder-hostile OID debentures with ugly sales terms that create a short-seller’s wet dream.
In November, they coppied 28.5 zillion coming from Streeterville Capital of which only $25 million was paid to the company; $3.4 zillion would be the discount the Streeterville pockets, and $100k is actually reserved to cover the expenses. Streeterville is related with Illiad Research and Trading, that is controlled by John Fife of Chicago Ventures Inc. Iliad has been termed as a “legendary so-called toxic lender”, by rival research firm Utopia Capital Research.
Cytodyn Inc (OTCMKTS:CYDY)
Under the phrases of the offer, Cytodyn wants to pay back again $7.5 million a month. If they don’t have the cash, they spend in stock; most not long ago, at a conversion cost of $3.40 a share.
Now consider when you are an opportunistic low rent lender and you’ve got an assured 2.2 million shares coming your way in the earliest week of every month. Any cost above the conversion expenditure is pure profit. Remember – this guy isn’t an investor; he’s a lender.
He is not operating on the hope that Cytodyn stock might go parabolic in the event that leronlimab is deemed a cure for ARDS; the online business model of his is limiting risk and optimize upside via discounted conversion of share.
This is the quick seller’s wet dream I am talking about. Not only would be the lender enticed to go brief, but any short-trading pail shop in town who are able to 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 lowered by to $3.40.
The SEC is not impressed, and on September 3, 2020, filed a criticism.
The Securities and Exchange Commission these days filed charges from John M. Fife of Companies and Chicago he controls for acquiring as well as selling much more than twenty one billion shares of penny inventory without registering as a securities dealer with the SEC.
The SEC’s criticism, alleges that between 2015 and 2020, Fife, and the companies of his, Chicago Venture Partners, L.P., Iliad Research in addition to the Trading, L.P., St. George Investments LLC, Tonaquint, Inc., as well as Typenex Co-Investment, LLC, frequently interested in the small business of buying sports convertible paperwork from penny stock issuers, transforming the notes into shares of inventory at a major discount from the market cost, and selling the freshly issued shares into the marketplace at a substantial profit. The SEC alleges which Fife as well as the businesses of his interested in around 250 convertible transactions with about 135 issuers, sold more than twenty one billion newly-issued penny stock shares to the industry, and obtained greater than sixty one dolars million in profits.
Streeterville Capital isn’t stated as an entity in the complaint. Which hints that it was likely applied by Fife as well as Cytodyn to avoid detection by the SEC this same scheme was getting perpetrated on Cytodyn within the time of its complaint.
But that is not the sole reason the stock can’t keep any upward momentum.
The company has been selling inventory privately from ridiculously minimal prices, to the point in which one wonders just that exactly are the blessed winners of what amounts to free millions of dollars?
Additionally, beginning in the month of November 2020 and for every one of the next five (5) calendar days thereafter, the Company is actually obligated to cut down the excellent sense of balance belonging to the Note by $7,500,000 a month (the “Debt Reduction Amount”). Payments the Company makes under the Prior Notes are going to be credited to the payment of each month Debt Reduction Amount. The Debt Reduction Amount payments are not be subject to the 15 % prepayment premium.
Likewise detracting from the business’s shine is actually the propensity of handling for excessively promotional communications with shareholders. During an investor webcast on January 5th, the business had a series of sound testimonials from patients applying PRO 140 for HIV treatment, backed by tear jerking music, and replete with emotional language devoid of data.
Even worse, the company’s telephone 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 particular is a “valid extension” according to the automated system.
That’s the type of approach that the SEC and FDA view unfavourably, and is likely at the very least 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 while using story coming out under just these ill-advised publicity stunts, shorts are actually attracted, and big money investors, alienated.
But think of this “management discount” as the ability to purchase a sizable role (should one be so inclined) found what might really well prove to be, in a situation of weeks, since the best therapy for severe COVID19 associated illness.
I expect the details from your trial now concluded for only such a sign could release the business into a complete new valuation altitude that will allow it to overcome these shortfalls.
Average trading volume is actually constant above six million shares 1 day, and right before the end of this week, we will find out just how efficient leronlimab/PRO 140/Vyrologix is at saving lives from the worst of COVID nineteen. If the results are good, this may be a big winner.
Cytodyn Inc (OTCMKTS:CYDY)