Cytodyn (CYDY) Phase 2b/3 Trial Results Expected Any Day
Cytodyn Inc (OTCMKTS:CYDY), a late-stage biotech drug developer, has already shipped a win for Wealthpress members from our first feature returned in April this year. Billions have been invested into hundreds of biotechs all competing to develop a medicine or maybe therapy for severe COVID 19 instances that trigger death, and also none have succeeded. Except Cytodyn, if early indications are established in the present trial now underway.
But after a serious jump on the company’s financial claims and SEC filings, a picture emerges of company control functioning with 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 anticipated upward price movement does not 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 business’s drug does in fact reliably preserve lifestyles in danger of severe-to-critical COVID19 patients, then a groundswell of investor assistance could push the organization into completely new, higher grade relationships, which would permit for the redemption of elimination as well as debentures of reliance on fly-by-night financings like those described below.
Cytodyn’s sole focus is actually creating remedies based on a monoclonal antibody known as “leronlimab”, technically described as “humanized IgG4, monoclonal antibody (mAb) to the C C chemokine receptor type 5 (CCR5)”. This engineered antibody was acquired from Progenics Pharmaceuticals as “PRO 140”, a recently acquired subsidiary of Lantheus Holdings Inc (NASDAQ:LNTH), again in 2012.
Total price of acquisition amounts to ten dolars million and a 5 % net royalty on business sales.
The drug was acquired on the early promise of its as an HIV therapy, for which continued development as well as research by Cytodyn has shown the potential to reduce regular drug cocktails with assortment pills into an individual monthly injection, in some cases, with 0 negative effects. To date, the FDA has denied Cytodyn’s Biologics License Application (BLA)
Since that time, Cytodyn’s scientific staff has discovered the antibody’s effect on the CCR5 receptor has incredibly positive therapeutic implications for everything out of some stable tumours to NASH (Non-alcoholic steatohepatitis), the liver feature condition that afflicts up to 12 % of the US public, and up to 26 % globally.
But the real emergent also potentially transformational program for leronlimab, as I have said at the start, (which is now getting branded as Vyrologix by Cytodyn), is made 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 today household word “cytokine storm”. Some proportion of patients apparently return from the brink after 2 treatments (and in a number of cases, one treatment) of leronlimab, still when intubated.
The company finished enrollment of a stage 2b/3 trial on December 15 to “evaluate the efficacy and safety of leronlimab for individuals with severe-to-critical COVID 19 indications is a two arm, placebo controlled, double blind, randomized, adaptive design and style multicenter study,” based on the company’s media release.
This trial phase concluded on January 12-ish, and if the outcomes are good, this will make leronlimab a high therapy for ARDS.
Cytodyn Inc (OTCMKTS:CYDY)
Although the vaccines that are presently spreading are definitely lending hope for a normalization of modern culture by mid 2021, the surging worldwide rates of contamination suggest the immediate future is already overwhelming health care systems across the world as increasingly more individuals call for access to Intensive Care Unit hospitalization.
During my 1st job interview with Dr. Nader Pourhassan back found March of 2020, the extreme eagerness of his for the prospects of this drug’s success was apparent.
This was prior to the now raging next trend had gathered heavy steam, as well as he was then noticing individuals which were getting leronlimab under the FDA’s Emergency Investigative New Drug exemption.
At the time, however,, this small independent biotech without any major funding and a decidedly unhappy public listing on the naked short-sellers’ dream OTC marketplace was getting able to utilize for a listing on NASDAQ, along with the deck was stacked against it.
Full Disclosure: I have 10,000 shares from an average cost of $6.23
Even though the planet focuses breathlessly on the hope for a new vaccine to regain their social liberties, the 10 ish portion of COVID infectees that descend into the cytokine storm driven ARDS actually have their lives saved by this apparently versatile drug. To them, a vaccine is pretty much pointless.
This drug has “blockbuster potential” written all over it.
With 394 people enrolled inside the Phase 2b/3 trial as of December sixteen, and first data expected this week, a demonstrable consistency in the details is going to record the world’s attention in probably the most profound way. Quick sellers could be swept apart (at least temporarily) as the business’s new share price levels qualify it for NASDAQ listing.
Cytodyn management says it’s 700,000 doses ready for sale right now, with an additional 2.5 zillion ordered for each of 2021 plus 2022 in a manufacturing arrangement with Samsung, based on its CEO.
so if leronlimab/PRO 140/Vyrologix is so great, how come the stock’s been stuck in sub 1dolar1 5 penny stock purgatory for such a long time?
The quick remedy is “OTC”.
Apart from dealing with a share price under three dolars, the company has not been equipped to meet and keep some different quantitative prerequisites, like positive shareholders’ equity of at least five dolars million.
But in the NASDAQ world, there are non quantifiable behaviours by organizations that can cause delays to NASDAQ listings. Overtly promotional communications are actually among such type of criteria which will never cause a refusal letter…nor a NASDAQ listing.
More importantly, Cytodyn has additionally not been equipped to access capital under conventional ways, thanks to its being mentioned on the OTC, and thus un-attractive on that basis alone to white shoe firms.
So, they’ve been cut down to accepting shareholder hostile OID debentures with unsightly conversion terms that generate a short-seller’s damp dream.
In November, they took 28.5 million coming from Streeterville Capital of which just twenty five dolars million was given to the company; $3.4 huge number of would be the discount the Streeterville pockets, and $100k is reserved to cover the costs. Streeterville is associated 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 studies tight Utopia Capital Research.
Cytodyn Inc (OTCMKTS:CYDY)
Under the phrases of the offer, Cytodyn needs to pay again $7.5 million per month. If they do not have the cash, they spend inside stock; most not long ago, at a conversion price of $3.40 a share.
These days consider if you’re an opportunistic low-rent lender and you’ve gained a guaranteed 2.2 million shares coming the way of yours in the very first week of each 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 expectation that Cytodyn stock may go parabolic in the event that leronlimab is deemed a remedy for ARDS; his online business model is to limit risk and maximize upside via affordable conversion of share.
This is the short seller’s wet dream I am speaking about. Not only would be the lender enticed to go brief, but some short-trading pail dealer in town who are able to fog a mirror and examine an EDGAR filing understand that each month, like clockwork, there is going to be two million+ shares striking the bid down to $3.40.
The SEC is not impressed, additionally, on September three, 2020, filed a complaint.
The Securities in addition to the Exchange Commission today filed charges from John M. Fife of Chicago and Companies he controls for obtaining as well as selling much more than twenty one billion shares of penny inventory without the need of registering as a securities dealer while using the SEC.
The SEC’s criticism, alleges this in between 2015 and 2020, Fife, and 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, regularly involved in the company of purchasing convertible notes at penny stock issuers, converting those notes into shares of stock at a major discount from the market price, and offering the newly issued shares into the market at a significant profit. The SEC alleges that Fife as well as the companies of his interested in more than 250 sports convertible transactions with roughly 135 issuers, sold more than twenty one billion newly-issued penny stock shares into the industry, and obtained more than sixty one dolars million in profits.
Streeterville Capital is not mentioned as an entity in the complaint. Which suggests it was likely used by Cytodyn and Fife to stay away from detection by the SEC this very same plan was being perpetrated on Cytodyn at the time of its complaint.
But that is not the sole reason the stock can’t observe any upward momentum.
The company has been offering inventory privately at ridiculously minimal prices, to the position where by one wonders just who exactly are the blessed winners of what requires no cost millions of dollars?
Additionally, starting inside the month of November 2020 and for each of the following 5 (five) calendar days thereafter, the Company is actually obliged to lower the exceptional balance with the Note by $7,500,000 a month (the “Debt Reduction Amount”). Payments the Company makes within the Prior Notes will be acknowledged to the payment of each monthly Debt Reduction Amount. The Debt Reduction Amount payments aren’t be subject to the 15 % prepayment premium.
Likewise detracting from the company’s shine is the propensity of managing for excessively promotional communications with shareholders. During an investor webcast on January 5th, the business had a number of sound testimonials from patients making use of PRO 140 for HIV treatment, backed by tear-jerking music, and then replete with mental language devoid of data.
Worse, the company’s mobile phone number at the bottom of press releases has an extension for Mike Mulholland, the CFO, and Nader Pourhassan, the CEO, but neither one particular is actually a “valid extension” according to the automatic phone system.
That is the kind of approach that the FDA and SEC 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 additionally come to be unresponsive to requests for interviews, and therefore with the story coming out less than just these ill-advised publicity stunts, shorts are actually attracted, and big cash investors, alienated.
But think of this “management discount” as the chance to acquire a sizable role (should a person be so inclined) found what might really well prove to be, in a matter of weeks, given that the top treatment for serious COVID19 related illness.
I expect the information from your trial now concluded for just such an indication might release the organization into a whole new valuation altitude that will enable it to overcome these shortfalls.
Average trading volume is actually steady above six million shares a day, and right before the tail end of this week, we’ll learn exactly how effective leronlimab/PRO 140/Vyrologix is actually at saving lives from the worst of COVID nineteen. In case the results are good, this can be a significant winner.
Cytodyn Inc (OTCMKTS:CYDY)