Cytodyn (CYDY) Phase 2b/3 Trial Results Expected Any Day
Cytodyn Inc (OTCMKTS:CYDY), a late stage biotech drug designer, has already delivered a win for Wealthpress subscribers from our 1st feature returned in April this year. Billions have been invested into hundreds of biotechs all competing to develop a cure or perhaps treatment for severe COVID 19 instances which trigger death, as well as none have been successful. Except for Cytodyn, if early indications are confirmed in the present trial now underway.
But after a deep jump on the business’s financial claims and SEC filings, an image emerges of company control operating who have a “toxic lender” to funnel severely discounted shares to the lender regularly. An investment in Cytodyn is a strictly speculative bet on my part, and if the expected upward price movement does not appear after results in the company’s period 2b/3 trial for severe-to-critical COVID 19, I will exit the investment.
If the business’s drug does in fact reliably save lifestyles in severe-to-critical COVID19 patients, then a groundswell of investor assistance can drive the business into completely new, higher-grade human relationships, which would allow 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 treatments used 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 particular engineered antibody was purchased of Progenics Pharmaceuticals as “PRO 140”, a recently acquired subsidiary of Lantheus Holdings Inc (NASDAQ:LNTH), again in 2012.
Total price of acquisition amounts to $10 million and a 5 % net royalty on business revenue.
The drug was acquired on its first promise as an HIV therapy, for which continued research as well as development by Cytodyn has demonstrated the capability to reduce regular drug cocktails with myriad pills into a specific monthly injection, sometimes, with 0 negative effects. To date, the FDA has denied Cytodyn’s Biologics License Application (BLA)
Since then, Cytodyn’s scientific staff has realized the antibody’s effect on the CCR5 receptor has incredibly optimistic therapeutic implications for everything from some solid tumours to NASH (Non alcoholic steatohepatitis), the liver feature condition which afflicts up to 12 % of the US population, and up to 26 % globally.
But the real emergent also likely transformational application for leronlimab, as mentioned at the start, (which is now being branded as Vyrologix by Cytodyn), is made for the Acute Respiratory Distress Syndrome (ARDS) brought on by COVID 19 which precludes the Sequential Organ Failure in fatal cases of COVID infections.
Leronlimab apparently blocks the CCR5 receptor from over responding to the virus as well as launching the now household-word “cytokine storm”. Some proportion of individuals obviously return from the brink following 2 treatments (and in a number of instances, one treatment) of leronlimab, even if intubated.
The company finished enrollment of a level 2b/3 trial on December fifteen to “evaluate the efficacy and safety of leronlimab for patients with severe-to-critical COVID 19 indications is actually a two arm, placebo controlled, double blind, randomized, adaptive design multicenter study,” according to the company’s press release.
This trial period concluded on January 12 ish, of course, if the results are good, this can make leronlimab a premier therapy for ARDS.
Cytodyn Inc (OTCMKTS:CYDY)
While the vaccines which are currently dispersing are certainly lending optimism for a normalization of modern society by mid-2021, the surging global rates of infection suggest the immediate future is already overwhelming health care systems around the world as increasingly more people call for utilization of Intensive Care Unit hospitalization.
During the 1st interview of mine with Dr. Nader Pourhassan back found March of 2020, his extreme passion for the prospects of this drug’s efficacy was apparent.
It was before the currently raging second trend had gathered heavy steam, and he was then seeing patients who were receiving leronlimab under the FDA’s Emergency Investigative New Drug exemption.
At the time, though, this small independent biotech without significant funding and a decidedly unfortunate public listing on the naked short-sellers’ fantasy OTC marketplace was getting ready to utilize for a listing on NASDAQ, along with the deck was stacked against it.
Full Disclosure: I have 10,000 shares at an average cost of $6.23
While the planet focuses breathlessly on the hope for the latest vaccine to regain the community liberties of theirs, the 10 ish portion of COVID infectees who descend into the cytokine storm-driven ARDS literally have their day saved by this seemingly flexible drug. For them, a vaccine is literally useless.
This particular drug has “blockbuster potential” written all over it.
With 394 people enrolled with the Phase 2b/3 trial as of December 16, and initially data expected this week, any demonstrable consistency in the details is going to capture the world’s focus in pretty much the most profound way. Short sellers could be swept apart (at least temporarily) simply because company’s new share priced levels qualify it for NASDAQ listing.
Cytodyn management says it’s 700,000 doses ready for sale right now, with an additional 2.5 huge number of purchased for each of 2021 and 2022 in a manufacturing arrangement with Samsung, based on its CEO.
The Downside
so if leronlimab/PRO 140/Vyrologix is so great, how come the stock’s been trapped in sub-1dolar1 five penny stock purgatory for such a long time?
The fast solution is “OTC”.
Besides struggling with a share price under $3, the company has not been able to meet and keep some different quantitative prerequisites, including positive shareholders’ equity with a minimum of $5 million.
But in the NASDAQ community, you can find non quantifiable behaviours by businesses that can cause waiting times to NASDAQ listings. Overtly promotional communications are actually among such criteria which will never lead to a refusal letter…nor a NASDAQ listing.
Most importantly, Cytodyn in addition has not been equipped to access capital under standard ways, because of its being mentioned on the OTC, in addition to therefore un attractive on that basis alone to white shoe firms.
Thus, they’ve been cut down to accepting shareholder-hostile OID debentures with ugly conversion terms that create a short-seller’s stormy dream.
In November, they coppied 28.5 million coming from Streeterville Capital of which only twenty five dolars million was given to the company; $3.4 million would be the discount the Streeterville sections, and $100k is actually set aside to protect the costs. 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 toxic lender”, by rival research firm Utopia Capital Research.
Cytodyn Inc (OTCMKTS:CYDY)
Under the terms of the price, Cytodyn has got to pay back again $7.5 million per month. If they don’t have the cash, they pay within stock; the majority of lately, at a sales price of $3.40 a share.
Now just imagine when you’re an opportunistic low-rent lender and you have got an assured 2.2 million shares coming the way of yours in the earliest week of each month. Any price above the conversion 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 in the event that leronlimab is deemed a cure for ARDS; his online business model is to limit risk and optimize upside via discounted transformation of share.
This’s the short seller’s wet dream I’m speaking about. Not only would be the lender enticed to go brief, but any short-trading container dealer in town who could fog a mirror and examine an EDGAR filing realize that each month, like clockwork, there’s going to be two million+ shares striking the bid lowered by to $3.40.
The SEC isn’t impressed, and on September three, 2020, filed a complaint.
The Securities as well as Exchange Commission nowadays filed charges from John M. Fife of Chicago and Companies he controls for obtaining and marketing much more than 21 billion shares of penny inventory without registering as a securities dealer using the SEC.
The SEC’s complaint, alleges that between 2015 as well as 2020, Fife, and his companies, Chicago Venture Partners, L.P., Iliad Research as well as Trading, L.P., St. George Investments LLC, Tonaquint, Inc., as well as Typenex Co Investment, LLC, frequently engaged in the business of purchasing sports convertible notes at penny stock issuers, converting those notes into shares of inventory at a major discount from the market cost, and offering the freshly issued shares into the market at a substantial profit. The SEC alleges which Fife and the businesses of his interested in more than 250 convertible transactions with approximately 135 issuers, sold greater than 21 billion newly-issued penny stock shares into the industry, and obtained greater than sixty one dolars million in profits.
Streeterville Capital isn’t mentioned as an entity of the complaint. Which implies that it was very likely utilized by Cytodyn and Fife to avoid detection by the SEC this very same plan was being perpetrated on Cytodyn within the time of the complaint of its.
But that’s not the sole reason the stock cannot maintain some upward momentum.
The company has been offering inventory privately from ridiculously low prices, to the point where one wonders just that exactly are the blessed winners of what amounts to free millions of dollars?
To wit:
Additionally, beginning inside the month of November 2020 and for each of the second five (5) calendar months thereafter, the Company is actually required to bring down the outstanding sense of balance of the Note by $7,500,000 per month (the “Debt Reduction Amount”). Payments the Company makes within the Prior Notes are going to be acknowledged toward the transaction of each monthly Debt Reduction Amount. The Debt Reduction Amount payments aren’t be subject to the fifteen % prepayment premium.
Likewise detracting from the business’s shine is the propensity of handling for excessively marketing communications with shareholders. During an investor webcast on January 5th, the business had a number of sound testimonials from people making use of PRO 140 for HIV treatment, backed by tear-jerking music, and then 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 Nader Pourhassan, the CFO, and Mike Mulholland, the CEO, but neither one is a “valid extension” in accordance with the automatic system.
That is the type of approach that the FDA and SEC view unfavourably, and is likely at minimum 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 so with the story coming out under just these ill advised publicity stunts, shorts are attracted, and huge money investors, alienated.
But think of this “management discount” as the opportunity to purchase a sizable position (should a person be so inclined) contained what may very well turn out to be, in a question of weeks, since the leading therapy for serious COVID19 associated illness.
I expect the details in the trial now concluded for just such a sign may release the organization into a whole new valuation altitude that will permit it to overpower these shortfalls.
Average trading volume is actually steady above six million shares 1 day, and before the end of this week, we will know exactly how efficient leronlimab/PRO 140/Vyrologix is actually for saving lives from the most severe of COVID nineteen. If the results are good, this can be a huge winner.
Cytodyn Inc (OTCMKTS:CYDY)
