Here's the full Mar 14 article you seek.
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Health Care
Cytodyn hits the home stretch for HIV therapy to hit the marketplace
The Vancouver, Washington, company could start pulling in revenue early next year, if all goes according to plan
{ Nader's smiling photo here }
Nader Pourhassan rescued Cytodyn from the brink of bankruptcy. Now the biotech's HIV therapy is closing in on commercialization.
By Elizabeth Hayes – Staff Reporter, Portland Business Journal
Mar 14, 2019, 1:32pm PDT Updated Mar 14, 2019, 4:16pm PDT
About six years after Nader Pourhassan rescued Cytodyn Inc. from the brink of bankruptcy, he believes the biotech company is closer than ever to getting its lead product out to the market and to transform the lives of patients with HIV.
The Vancouver, Washington-based company has completed all clinical trials for its HIV therapy, leronlimab, and plans to submit the first third of its three-part Biologics License Application to U.S. Food and Drug Administration this month. Once the application is fully submitted later this year, Pourhassan expects to get the go-ahead from the FDA in the first quarter of next year.
“We will have revenue in 2020,” he said.
Cytodyn has received offers from commercialization companies “with significant upfront and milestone payments for our products,” Pourhassan said. In addition, “a large biologics manufacturing” company has agreed to make half a billion dollars worth of Cytodyn’s product with no payment due until the end of 2020.
H.C. Wainwright senior health care analyst Ram Selvaraju has a “buy” rating for Cytodyn, which may be more optimistic than the market in general. The over-the-counter stock trades for around 49 cents a share, giving Cytodyn a market cap of $150 million. Selvaraju has a $1.50 per share price target for Cytodyn and assumes an 80 percent probability of leronlimab's approval.
“I think the current market cap assumes a healthy degree of risk, due to the possibility the (application) might be rejected,” Selvaraju said. “Would I love to see this company trading on a regulated exchange? Of course. Would I love to see it trade above a dollar? Of course. The reason why it’s range-bound is people are waiting for a significant regulatory de-risking event like the approval of leronlimab.”
The future of HIV treatment
Founded in 2003, Cytodyn's first product was another HIV antibody that never got off the ground. Pourhassan joined Cytodyn in 2008 as chief operating officer and helped raise money and avoid bankruptcy, even as the documents were about to be filed.
After taking over as CEO in 2012, Pourhassan initiated the acquisition of PRO 140, as leronlimab was originally called, from Progenics Pharmaceuticals Inc. Cytodyn paid $3.5 million down, along with an agreement on cash royalties and a percentage of sales.
Leronlimab belongs to a new class of drugs called “viral-entry inhibitors.” While it’s not a cure for HIV, it has been shown in clinical trials to significantly reduce viral burden in patients.
The FDA last March approved TaiMed Biologics' Trogarzo, which also acts as an HIV inhibitor. Like leronlimab, Trogarzo contains laboratory-produced antibodies that bind to a cell receptor, preventing the virus from latching on.
“Similarly, we think PRO140 should be considered an effective treatment option for people with multi-drug resistant HIV,” Selvaraju said. “There’s always doubts in people’s minds about a first-of-its kind in any class or category, but in this case, leronlimab is not the first example of a monoclonal inhibitor.”
H.C. Wainwright senior health care analyst Ram Selvaraju has a “buy” rating for Cytodyn.
COURTESY OF RAM SELVARAJU
Leronlimab has completed seven clinical trials in 670 people, including a pivotal phase 3 trial, in combination with standard anti-retroviral therapies. It showed an 81 percent suppressed viral load at the end of the 25-week trial. Leronlimab also appears to have fewer side effects and requires less frequent dosing than standard HIV drugs. It can be self-injected by the patient once a week, as opposed dozens of daily pills.
“The future of HIV is looking at one thing: patients need something simpler than taking multiple drugs every day, and the only thing coming from big pharma is inter-muscular injection, which is very painful,” Pourhassan said. “With our product, we have shown in 670 patients we had zero serious adverse events. I don’t think any HIV drug out there has zero.”
Cytodyn also has a phase 3 investigative trial going for the use of leronlimab as a single therapy.
More recently, Cytodyn has been exploring the use of leronlimab in cancer treatment. CCR5 seems to also play a central role in tumor invasion and metastasis, according to research conducted by oncologist Dr. Richard Pestell.
“Studies show (leronlimab) does indeed bind onto cancer cells and block the invasion of human breast cancer cells,” Pestell said. “It’s a different approach, and it’s a new target for cancer treatment.”
Pestell was the CEO of Philadelphia-based ProstaGene, which Cytodyn acquired last November. Pestell now serves as vice chairman of Cytodyn’s board and chief medical officer.
Cytodyn filed for a triple negative cancer protocol with the FDA and will inject its first cancer patient this month. All told, the company has initiated preclinical studies for eight kinds of cancer, at a cost of $1.5 million.
Financial outlook
With only nine full-time employees, Cytodyn outsources much of its work, including the very lengthy license application.
The company has burned through about $200 million through stock sales in 2012. As of Nov. 30, it had $772,000 in cash and $20.3 million in total liabilities and stockholders’ equity.
Assuming leronlimab is approved and Cytodyn moves forward with commercialization, the deficit will begin to decrease and convert to stockholders’ equity.
From the day Pestell joined forces with Cytodyn in August, it has raised $41 million in stock sales, Pourhassan said. He believes the company needs $30 million more to finish its application and get Cytodyn to the point of achieving revenue. If it inks a licensing deal with an upfront payment, it won’t need to do another stock offering, Pourhassan said.
Selvaraju believes it will be tough for Cytodyn to turn leronlimab into a blockbuster drug on its own. A deal with a large pharma company like Gilead, which produced hugely successful hepatitis C drugs but now needs a second act, could be the ticket.
If all goes well, Pourhassan hopes to move Cytodyn to the New York Stock Exchange.
“We are a company held hostage on the OTC unless we raise all the money we need for next year and a half and have a stock price of $2 or $4,” he said. “We believe the stock has upside any day now.”
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CLOSER LOOK
CYTODYN INC.
What is does: Biotechnology company developing a monoclonal antibody for HIV treatment, with possible applications for cancer therapy
President and CEO: Nader Pourhassan
Headquarters: Recently moved to Fort Lauderdale, Florida from Vancouver, where the administrative offices and CEO remain
Stock: Trades over-the-counter for about 49 cents
Market cap: $150.3 million
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