Cytodyn (CYDY) Phase 2b/3 Trial Results Expected Any Day
Cytodyn Inc (OTCMKTS:CYDY), a late-stage biotech drug creator, has already shipped a win for Wealthpress subscribers from our first feature back in April this year. Billions have been invested straight into a huge selection of biotechs all competing to create a cure or maybe treatment for serious COVID 19 situations that trigger death, and none have succeeded. Except Cytodyn, if early indications are established in the present trial now underway.
But right after a serious jump on the company’s fiscal claims as well as SEC filings, an image emerges of company management 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 the part of mine, and if the expected upward price movement does not manifest following results of the company’s phase 2b/3 trial for severe-to-critical COVID 19, I am going to exit the investment.
In case the business’s drug does in fact reliably conserve lifestyles to come down with severe-to-critical COVID19 individuals, then a groundswell of investor assistance could 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 like those discussed below.
Cytodyn’s sole focus is developing treatments based 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 engineered antibody was purchased from Progenics Pharmaceuticals as “PRO 140”, a recently acquired subsidiary of Lantheus Holdings Inc (NASDAQ:LNTH), again in 2012.
Total cost of acquisition amounts to $10 million and a five % net royalty on business revenue.
The drug was acquired on its early promise as an HIV treatment, for which continued development as well as research by Cytodyn has highlighted the capability to reduce regular drug cocktails with assortment pills into a specific monthly injection, sometimes, with 0 side effects. To day, the FDA has denied Cytodyn’s Biologics License Application (BLA)
Since then, Cytodyn’s scientific staff has discovered the antibody’s effect on the CCR5 receptor has extremely positive therapeutic implications for everything out of some solid tumours to NASH (Non-alcoholic steatohepatitis), the liver feature ailment that afflicts up to 12 percent of the US public, and up to twenty six % globally.
But the real emergent also likely transformational application for leronlimab, as I have said at the beginning, (which is already being branded as Vyrologix by Cytodyn), is designed for the Acute Respiratory Distress Syndrome (ARDS) brought on by COVID 19 which precludes the Sequential Organ Failure wearing fatal instances of COVID infections.
Leronlimab evidently prevents the CCR5 receptor from over-responding to the virus and also launching the now household-word “cytokine storm”. Some proportion of clients evidently return from the brink following 2 treatments (and in a number of instances, 1 treatment) of leronlimab, still when intubated.
The company completed enrollment of a stage 2b/3 trial on December 15 to “evaluate the efficacy as well as safety of leronlimab for patients with severe-to-critical COVID 19 indications is actually a two arm, randomized, double blind, placebo controlled, adaptive design multicenter study,” based on the company’s media release.
This trial phase concluded on January 12-ish, of course, if the results are positive, this will make leronlimab a top therapy for ARDS.
Cytodyn Inc (OTCMKTS:CYDY)
While the vaccines that are currently dispersing are certainly lending hope for a normalization of modern society by mid-2021, the surging worldwide rates of illness mean the immediate future is today overwhelming health care systems across the world as more and more people require ability to access Intensive Care Unit hospitalization.
During my 1st interview with Dr. Nader Pourhassan returned contained March of 2020, his extreme enthusiasm for the prospects of the drug’s success was apparent.
This was before the now raging second trend had gathered steam, and also he was then discovering patients which were receiving leronlimab under the FDA’s Emergency Investigative New Drug exemption.
Within the time, though, this small independent biotech without any major funding and a decidedly unhappy public listing on the naked short-sellers’ dream OTC marketplace was getting prepared to put on for a listing on NASDAQ, and the deck was stacked from it.
Full Disclosure: I own 10,000 shares at an average price of $6.23
While the world concentrates breathlessly on the optimism for a new vaccine to regain their community liberties, the 10-ish fraction of COVID infectees who descend into the cytokine storm-driven ARDS literally have their day saved by this apparently versatile drug. For these people, a vaccine is pretty much useless.
This particular drug has “blockbuster potential” written all over it.
With 394 people enrolled with the Phase 2b/3 trial as of December sixteen, in addition to first information expected this week, a demonstrable consistency in the data will record the world’s interest in probably the most profound way. Quick sellers may be swept apart (at minimum temporarily) simply because business’s new share priced amounts qualify it for NASDAQ listing.
Cytodyn management says it has 700,000 doses prepared for sale now, with an additional 2.5 million ordered for each of 2021 and 2022 in a manufacturing understanding with Samsung, as per the CEO of its.
so if leronlimab/PRO 140/Vyrologix is very great, why the stock’s been stuck in sub-1dolar1 five penny stock purgatory for so long?
The fast solution is “OTC”.
Besides struggling with a share price under $3, the company hasn’t been in a position to meet and keep certain different quantitative prerequisites, like positive shareholders’ equity with a minimum of $5 million.
But in the NASDAQ world, there are non quantifiable behaviours by companies that can cause slow downs to NASDAQ listings. Overtly advertising communications are among such type of criteria that won’t ever lead to a refusal letter…nor a NASDAQ listing.
Most importantly, Cytodyn has also not been equipped to access capital under conventional ways, thanks to its being mentioned on the OTC, in addition to therefore un attractive on that basis alone to white shoe firms.
Thus, they have been lowered to accepting shareholder-hostile OID debentures with unsightly conversion terms that generate a short-seller’s wet dream.
In November, they took 28.5 million out of Streeterville Capital of which just $25 million was paid to the company; $3.4 huge number of is the discount the Streeterville pockets, and $100k is actually set aside to cover the expenditures. Streeterville is linked with Illiad Research and Trading, which is managed by John Fife of Chicago Ventures Inc. Iliad has been known as a “legendary so called poisonous lender”, by rival research firm Utopia Capital Research.
Cytodyn Inc (OTCMKTS:CYDY)
Under the terms of the offer, Cytodyn must pay back $7.5 million per month. If they do not have the cash, they pay within stock; many recently, within a conversion price of $3.40 a share.
These days just imagine when you are an opportunistic low-rent lender and you’ve received an assured 2.2 million shares coming your way in the very first week of every month. Any price tag above the conversion expenditure is pure profit. Remember – this guy is not 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 remedy for ARDS; his business model is limiting risk and maximize upside via affordable transformation of share.
This’s the brief seller’s wet dream I am discussing. Not only is the lender enticed to go brief, but any short trading container dealer in town who can fog a mirror and read an EDGAR filing realize that every month, like clockwork, there is going to be two million+ shares striking the bid lowered by to $3.40.
The SEC isn’t impressed, in addition, on September 3, 2020, filed a criticism.
The Securities and Exchange Commission nowadays filed charges against John M. Fife of Chicago and Companies he controls for acquiring and promoting much more than twenty one billion shares of penny stock without the need of registering to be a securities dealer using the SEC.
The SEC’s criticism, alleges that between 2015 and 2020, Fife, as well as his businesses, Chicago Venture Partners, L.P., Iliad Research and Trading, L.P., St. George Investments LLC, Tonaquint, Inc., and Typenex Co-Investment, LLC, regularly involved in the company of purchasing convertible notes at penny stock issuers, converting these notes into shares of inventory at a major discount from the market cost, and selling the freshly issued shares to the marketplace at a significant profit. The SEC alleges that Fife and his businesses interested in over 250 sports convertible transactions with about 135 issuers, sold greater than 21 billion newly-issued penny stock shares to the market, and obtained greater than sixty one dolars million in earnings.
Streeterville Capital is not stated as an entity in the complaint. Which implies that it was very likely used by Fife and Cytodyn to avoid detection by the SEC that this same plan was getting perpetrated on Cytodyn at the time of the complaint of its.
But that is not the sole reason the stock can’t keep some upward momentum.
The company has been selling inventory privately from ridiculously minimal prices, to the point where one wonders just that exactly are the lucky winners of what amounts to no cost millions of dollars?
Furthermore, beginning in the month of November 2020 and also for every one of the following 5 (five) calendar months thereafter, the Company is actually required to reduce the outstanding sense of balance 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 month Debt Reduction Amount. The Debt Reduction Amount payments aren’t be subject to the 15 % prepayment premium.
Likewise detracting from the company’s gloss is actually the propensity of handling for endlessly promotional communications with shareholders. During an investor webcast on January 5th, the company played a number of sound testimonials from people using PRO 140 for HIV therapy, backed by tear jerking music, and replete with mental language devoid of information.
Worse, the company’s telephone number at the bottom part of press releases comes with an extension for Mike Mulholland, the CFO, and Nader Pourhassan, the CEO, but neither one particular is a “valid extension” according to the automated phone system.
That’s the type of approach that the FDA and SEC view unfavourably, and is likely at least in part the reason for their continued underdog status at both agencies.
The company has also come to be unresponsive to requests for interviews, and so using 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 specific “management discount” as the opportunity to acquire a sizable role (should a person be so inclined) in what could very well turn out to be, in a matter of weeks, since the leading treatment for severe COVID19 associated illness.
I expect the information from the trial now concluded for just such an indication may release the business into a complete new valuation altitude that will permit it to overpower these shortfalls.
Average trading volume is actually steady above 6 million shares 1 day, and right before the tail end of this week, we’ll learn exactly how effective leronlimab/PRO 140/Vyrologix is for saving lives from the worst of COVID nineteen. If the results are positive, this can be a significant winner.
Cytodyn Inc (OTCMKTS:CYDY)