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CytoDyn Inc (OTC MKTS: CYDY)

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mick Member Level  Monday, 02/17/20 11:07:53 AM
Re: mick post# 506776
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CytoDyn Inc (OTC MKTS: CYDY)
Investors also overlooked a strong buy reiteration from HC Wainwright. The unexpected positives were a licensing deal with a top Chinese biotech for the 2019 Novel Coronavirus (2019-nCoV) and cancer.

They said they signed a non-binding deal but were waiting for the approval.

They mentioned injecting in coronavirus patients very soon; with an infected count close to 40,000, how can this be taken as a negative?

NEGATIVE FOCUS IN A SEA OF POSITIVE DEVELOPMENTS
The Culper Report sensationalizes that Pourhassan was a 2-time felon
and about to run away with all the investors money.

If investors were to take a deeper dive into the 8-K disclosure they would see the was no stealing but simply an over draft by $100.

The second had no conviction and was 20 – 30 years ago.

In one instance he sent an innocuous email to his son via his ex-wife.

These were for the utterly ridiculous charges. Putting this into perspective, in some states a 2 time DUI offender doesn’t even warrant a felony.

The report faults Pourhassan for not getting an approval in 7 years
but fails to mention that Pourshassan changed the course of a 20 year approval that Progenics gave up on and now they are possibly just 7 short months away from an approval in combination HIV.

In fact the report rewrites history and suggests CytoDyn only has priority review when, in fact, they have fast track.

They call Pourhassan a promoter and a con man.

They talk about “bloated balance sheet” when the company just retired its senior debt.

Culper completely and utterly misstates that the company has
“5 days of cash” after CytoDyn just completed a $7.0 million preferred stock offering.

The report even goes to lengths of citing an unknown oncologist at
a leading cancer research organization who is essentially saying that Circulating Tumor Cells (CTC’s) which is an FDA approved test from CELLSEARCH® is not an approvable endpoint.

The report says from this unknown oncologist that

“no detectable circulating tumor cells doesn’t mean anything” and “there’s nothing here at all to convince anybody that the drug has efficacy in breast cancer.” Per a second oncologist, “[regarding] the diminishment [in CTCs], I haven’t seen any data to suggest that diminishing CTC’s improves function” and in response to Pourhassan’s claim that, “CTC, that’s what kills people”, he stated that, “I would be a little skeptical of that statement … It’s the complete metastatic process that is typically fatal to the patient.”

This is the most egregious of their claims that is completely unsupported.

The rest of the report talks about the drama between Pourhassan and the exiting CMO. They poke fun at how CytoDyn characterized the upcoming FDA meeting regarding their BTD. They even bring up their partner Vyera that paid them over $4.0 million already. They top off their arguments poking holes in the revenue estimates and the assumptions. The one comment that wins the prize for most outlandish is that management was “putting human lives at risk – in the name of Pourhassan’s promotional self-enrichment campaign.” Disgusting commentary and if any long term followers sold because of this article they should be ashamed of their due diligence skills and for not using their common sense. The only honest reporting was the growth in share count graph.

COMING CATALYSTS
Coronavirus Update: The CEO stated that they have finalized a deal with a Chinese partner and are awaiting approval to release the news. If this is a big name pharma, as the company alluded to, this could be a major catalyst for stock appreciation. Pourhassan mentioned that the Chinese were very impressed by the safety profile and could scale this very rapidly. If the company starts dosing in days or weeks this could be a very big catalyst for stock appreciation.

Partnering with the Chinese is not a bad thing because it ultimately brings in non-dilutive financing and quite frankly none of the big pharma care about China so it doesn’t hurt licensing prospects either. In fact it may intensify things and big pharma wakes up out of their slumber and realized that CYDY has a pipeline of 32 indications all with one drug. The CEO said that leronlimab could be the next Humira.

Cancer Updates – The basket trial is under way and the next catalyst should be the dosing of people under this trial. What is interesting is the CEO indicated that they might be able to file for a BTD under the basket trial. If that should happen valuations could quickly climb in the billions as investors discount the likelihood of approval.

Fundraising: CYDY has hired a premier investment banker to negotiate $40 – 50 million in debt using the IP as collateral. The company also indicated they had some warrant exercises and did an offering of preferred stock and should have about $10 million in the bank factoring in recent offerings and cash burn.

PrEP Licensing: There are 2 major abstracts being presented at the CROI conference and one at the Keystone Symposium in early March. Given that over a decade has passed since the last late breaker presentation it’s expected that the presentation should be excellent. The company is clearly setting itself up to receive another potential BTD in pre-exposure prophylaxis (PrEP).

Uplisting: On the call they skimmed over the NASDAQ listing requirements, and focused on the NYSE which requires $5.0 million cash, and 18 months of operational money as well as a $2.00 stock price. They indicated on the Q&A section that when they meet the requirements they are ready to go. The reason an uplisting is so crucial for the company is because should they get a BTD approval NYSE listing will ensure a much better price discovery with institutional investors versus OTC Markets.

Analyst Upgrades: HC Wainwright came out with a buy reiteration,but given this is one of the most liquid OTC stocks some of the other houses are surely to come out with an upgrade or initial coverage. Biotechs always need money and they wouldn’t want to squander having research coverage.

THE GOLDEN NUGGET
It’s important for shareholders to realize why the BLA was delayed: initially, the FDA only wanted the safety data from 50 patients, when the FDA asked for data from all 595 patients in the ongoing CD03 trial in BLA format this created much more work (this is a manual procedure) — The FDA was essentially sitting quietly on the sidelines, happy with the data but wanted 595 instead of 50 patients.

Investors should keep in mind that the company was supposed to have filed the completed BLA originally by the end of December, with the safety data already on file for months. The timing of the clinical part was for all practical purposes done, with only the CMC (Chemistry, Manufacturing, & Controls) stability studies remaining.

Indirectly the FDA is helping CytoDyn by not making them do another trial.

CANCER BREAKTHROUGH THERAPY
When considering a BTD application, safety plays a big part in it. There is clearly enough safety data in HIV for a BTD in Metastatic Breast Cancer (MBC). BTD is given to products that meet two conditions, products that meet an unmet medical need and products that demonstrate efficacy. However, safety is the top of the pyramid when considering BTD. Another golden nugget is that there are great results to share with the FDA, the efficacy shows zero CTC’s and tumors that are stable or shrinking. With ample safety data the company wont want to get knocked out of contention for not having it in the file. It seems like the company wants to get it right the first time, and that might translate into exponential price appreciation with a BTD.

CTC BASED APPROVAL



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