This was posted on the Yahoo board and I thought it was an interesting take/observation. What do people here think about it? I am not asking if you want CYDY to be acquired or not, I am asking what do you think of this poster's thought process. Thanks!
Posted by Bridge to Sell
I was able to get another 9,260 shares this morning at $5.00. The reason I added to my already substantial position is because of some interesting aspects of yesterday's call that I don't think have been discussed in nearly enough detail.
Prior to the call we received a laundry list of items that were to be discussed. We were also given significant advance notice as we have been before previous calls. All of this points to a courtship, not of retail or institutional investors, but of an acquirer.
The preponderance of time spent on all of the additional indications, particularly HIV, indicates to me that management is trying to illustrate to a potential big pharma buyer that Vyrologix (né Leronlimab) has significant value beyond it's use against Covid-19.
As valuable as Vyrologix can potentially be during this pandemic, it's revenue stream after 2 or 3 years vis-à-vis Covid-19 will diminish. That is not to say that it will not have a place in ARDS and continuing pockets of Covid-19, but large pharmaceutical companies are generally looking for long term bankable drugs. Anything purchased strictly for one indication is limited in what worth it has.
So yesterday we got the dog and pony show about HIV. The testimonials were very nice but their purpose was quite clear. Management is trying to make the case to some suitor that Vyrologix can be a 'pipeline in a drug'. This type of acquisition is the rarest and most valued to big pharma. There are dividends to be paid and institutional shareholders to be appeased for these large companies. Bedrock long term drugs are crucial to that paradigm.
I took great comfort in the fact that the meeting was positioned thusly. As a matter of fact the last several meetings were conducted in just such a manner (save the testimonials). At first I dismissed this approach. I thought management was creating a fall back argument in case CD12 failed to meet endpoints and they wanted to keep shareholders from running for the exits. To be truthful, I don't think that anyone could help that from happening should CD12 fail.
Now however I believe that what we're seeing is positioning for a sale. Cytodyn lacks the staff, knowledge, or connections to maximize the value of Vyrologix. Furthermore, the HIV indication is encumbered by it commercialization agreement with Vyera. In order to unlock the true value a partner is needed who could also possibly acquire the rights from Vyera or buy that company in full.
Because of this unfortunate encumbrance to Vyera, I think it's easier to understand the company's reliance on NASH and it's cancer basket trial application for Break Through Designation. Both indications have been mentioned prominently in recent calls. Management is trying to soften the blow of the Vyera relationship.
My crystal ball says that nothing will actually happen until CD12 reads out and uplisting to NASDAQ occurs. In order for a large pharmaceutical company to pay the type of money that I believe would be necessary, the stock has to already be trading upwards of $30-$50 per share.
We've heard a lot of hyperbole from the CEO about how this should be a triple digit stock. I believe that's a negotiating posture. If he truly has any grasp of what it takes to get the company to a point where it could command such a valuation then he should also realize that getting 60% or 70% of that value in present dollars is a no brainer.
In my opinion, if CD12 gets us EUA, the BLA is granted rolling submission, and Cancer receives BTD from the FDA the company will get sold relatively quickly somewhere between $60-$75 per share. Irrational exuberance aside, it will be many years with current management before all of the value of this drug could be realized. A suitor arriving on scene in Q2 2021 is the best and most likely way to achieve maximum shareholder value IMHO.
Good luck fellow longs.
Posted by Bridge to Sell
I was able to get another 9,260 shares this morning at $5.00. The reason I added to my already substantial position is because of some interesting aspects of yesterday's call that I don't think have been discussed in nearly enough detail.
Prior to the call we received a laundry list of items that were to be discussed. We were also given significant advance notice as we have been before previous calls. All of this points to a courtship, not of retail or institutional investors, but of an acquirer.
The preponderance of time spent on all of the additional indications, particularly HIV, indicates to me that management is trying to illustrate to a potential big pharma buyer that Vyrologix (né Leronlimab) has significant value beyond it's use against Covid-19.
As valuable as Vyrologix can potentially be during this pandemic, it's revenue stream after 2 or 3 years vis-à-vis Covid-19 will diminish. That is not to say that it will not have a place in ARDS and continuing pockets of Covid-19, but large pharmaceutical companies are generally looking for long term bankable drugs. Anything purchased strictly for one indication is limited in what worth it has.
So yesterday we got the dog and pony show about HIV. The testimonials were very nice but their purpose was quite clear. Management is trying to make the case to some suitor that Vyrologix can be a 'pipeline in a drug'. This type of acquisition is the rarest and most valued to big pharma. There are dividends to be paid and institutional shareholders to be appeased for these large companies. Bedrock long term drugs are crucial to that paradigm.
I took great comfort in the fact that the meeting was positioned thusly. As a matter of fact the last several meetings were conducted in just such a manner (save the testimonials). At first I dismissed this approach. I thought management was creating a fall back argument in case CD12 failed to meet endpoints and they wanted to keep shareholders from running for the exits. To be truthful, I don't think that anyone could help that from happening should CD12 fail.
Now however I believe that what we're seeing is positioning for a sale. Cytodyn lacks the staff, knowledge, or connections to maximize the value of Vyrologix. Furthermore, the HIV indication is encumbered by it commercialization agreement with Vyera. In order to unlock the true value a partner is needed who could also possibly acquire the rights from Vyera or buy that company in full.
Because of this unfortunate encumbrance to Vyera, I think it's easier to understand the company's reliance on NASH and it's cancer basket trial application for Break Through Designation. Both indications have been mentioned prominently in recent calls. Management is trying to soften the blow of the Vyera relationship.
My crystal ball says that nothing will actually happen until CD12 reads out and uplisting to NASDAQ occurs. In order for a large pharmaceutical company to pay the type of money that I believe would be necessary, the stock has to already be trading upwards of $30-$50 per share.
We've heard a lot of hyperbole from the CEO about how this should be a triple digit stock. I believe that's a negotiating posture. If he truly has any grasp of what it takes to get the company to a point where it could command such a valuation then he should also realize that getting 60% or 70% of that value in present dollars is a no brainer.
In my opinion, if CD12 gets us EUA, the BLA is granted rolling submission, and Cancer receives BTD from the FDA the company will get sold relatively quickly somewhere between $60-$75 per share. Irrational exuberance aside, it will be many years with current management before all of the value of this drug could be realized. A suitor arriving on scene in Q2 2021 is the best and most likely way to achieve maximum shareholder value IMHO.
Good luck fellow longs.
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