Cytodyn Inc (CYDY)

[fred198484]

The big question in my mind is not the phase III primary endpoint results, which I assume will be good but the financing that is yet to come. It seems clear to me the weekly cash raise of $1 million or so is just a patch to get the company to when it can do a larger cash raise on the back of the good primary endpoint results (and perhaps breakthrough therapy). My concern has long been that this could be a very significant and dilutive equity offering. Alternatively, and perhaps more sensibly if they are confident in the results, they could try to raise a smaller amount, say $15 million, now and then raise a lot more later when they hope the share price is higher due to monotherapy results being available.

It will also be interesting to see if the FDA requires a second phase III trial for both combo and mono. If so, all the time lines get stretched out and the need for funding is much, much greater.