Quite good article in Seeking Alpha - calls Leron "Miracle Drug
The writer is a trader who's decided to build a long-term position, but he/she will still continue to trade a portion of their holdings. Even so, the simple idea of buy and hold should strike some of their readers.
The piece was written before the most recent video by NP told us that the interim analysis in Brazil will be for fewer patients.
Here's the full text, in case, Seeking Alpha wants you subscribe:
Cytodyn (OTCQB:CYDY) recently reported data from their NASH and triple-negative breast cancer studies using Leronlimab. The data revealed impressive results in both indications which will improve the outlook for their late-stage trials prospects for approval. What is more, this data validates Leronlimab's potential seen as a “miracle drug.” The steady sell-off has provided investors an opportunity to accumulate shares at a cheaper valuation, which could be held for a long-term investment. I intend to review the recent data and we'll discuss why I think adequate enough to switch my game plan from a short-term strategy to a long-term investment.
NASH Data
CytoDyn publicized preliminary marks from five patients in its 90 patient Phase II trial for NASH. These initial discoveries from these five patients treated with Leronlimab proposed that all five patients experienced a decrease in fatty deposits “by as much as 45%” from baseline. Furthermore, four out of five patients experienced a decrease in fibrosis “by as much as 10%” from baseline.
This data suggests that Leronlimab may impede liver fibrosis seen in NASH. It appears that Leronlimab could be deployed to patients with nonalcoholic fatty liver disease “NAFLD”, to prevent patients from developing NASH. The company expects to report additional data in the next month or so and is anticipating starting a Phase IIb/III protocol with a biopsy in January. What is more, the company believes there is a potential for Leronlimab to get a Breakthrough Therapy Designation in NASH.
At the moment, there are no FDA-approved treatments for NASH despite 30-40% of adults in the U.S. having NAFLD and 3-12% having NASH. So, if all goes well, Leronlimab will be the first or one of the first therapies in a huge NASH market opportunity.
mTNBC Data
The company also announced results from its CCR5+ Metastatic Triple-Negative Breast Cancer “mTNBC” study using Leronlimab in patients who had previously failed at least two lines of therapy. This analysis was from 28 pooled patients with 16 of the patients coming from the company’s Compassionate Use Study, 10 from the Phase Ib/II Study, and 2 from the Basket Study. It was discovered that 75% of the patients who produced a decrease of circulating tumors cells after Leronlimab had a 3600% increase in 12-month OS. This is a substantial improvement over the 980% increase in OS reported back in August. The analysis also revealed a 580% increase in 12-month PFS. As result, the company is “preparing a Breakthrough Therapy application to be submitted to the FDA this week.”
If Leronlimab is able to demonstrate its ability to reduce CTCs, increase PFS, and improve OS, it could cause a paradigm shift in how the world treats mTNBC.
Switching the Game Plan
Although I have always planned to hold a core position in CYDY, my strategy has been focused on trading the ticker rather than slowly accumulating a position. This decision was based upon the volatility of the ticker and the company's affinity for press releases which allowed me countless opportunities to buy and sell for a substantial profit.
Despite my bullishness and the company's upside potential, I have always lacked the conviction to hold the majority of my position because of the company's decision to initiate numerous clinical programs and trials for Leronlimab without securing at least one FDA approval.
I was concerned the company was spreading itself and its financial position way too thin, which prevented me from holding a large position for an extended period of time. Now, the company has validated their approach with their recent data which exhibits Leronlimab’s potential to be a legitimate “miracle drug.” If Leronlimab is approved in its current indications it could easily be a blockbuster drug in several years.
Figure 1: CytoDyn Programs for 2021 (Source: CytoDyn Presentation)
This has encouraged me to stop trading CYDY and switch to a more long-term investment approach. I believe this data has added a whole new element to the bull thesis and will make cancer and Nash updates more potent as the timeline 4 a potential approval shortens. I believe we've seen enough data from the triple-negative breast cancer studies to expect positive results in future readouts and studies, which has provided me with enough confidence to start accumulating before these programs finish pivotal trials.
Indeed, I'm not going to go "all-in" at this point of time, nor, am I going to commit to an upsized position before CytoDyn is officially a commercial-stage company. So, I plan to have a dual strategy of still trading some shares while accumulating some for a longer-term position. The trading shares will be used to generate some profit, while the investment chairs will be bought periodically as long as the price is below $1.50 per share. If the share price climbs above $1.50 per share, I will only trade CYDY until it drops below $1.50, or the company announces a development that moves my "buy level" higher.
Remaining Cautious about Downside Risks
Although the recent updates have provided me with enough confidence to expand my time horizon on CYDY, I am still remaining cautious at this point in time. The company continues to expand Leronlimab’s potential uses, while still failing to get the HIV BLA resubmitted. I understand the company had to go back through and redo some tedious tasks to appease the FDA. However, the protracted timeline to the HIV BLA resubmission is hurting investor sentiment and prolonging the cash burn.
What is more, the company was hoping to see the interim analysis for their COVID-19 programs in Brazil before year-end, but the company announced they treated their first patient a little over a week ago. The company needs 127 patients to complete their 28-day trial before they are able to get an interim analysis, so the company is going to need to get at least 127 patients dosed by the start of December in order to hit their goal timeline.
Obviously, missing the goal date by a week or two won’t make too big of a difference fundamentally, however, I suspect investors will start to doubt the program if we get to February and the company has failed to provide an update on their Brazilian trials. At that point, Merck (MRK) would probably have a EUA for their antiviral drug, which would hurt Leronlimab’s commercial prospects in COVID-19 and damage the share price.
Essentially, all of the company’s previous mishaps are still lingering and the company’s efforts to have investors turn their attention to NASH and cancer is not going to make those issues disappear. Consequently, I am going to keep CYDY to a 1/3-1/2 sized position until the company has proven they can get Leronlimab approved in at least one indication and collect product revenue.
Adjusting the Ditch List
In addition to changing up my game plan, I am also adjusting my "ditch list" to focus more on the clinical data rather than executive decisions. My previous "ditch list" required CytoDyn to receive FDA approval for Leronlimab in HIV in combination with HAART, and the company starting the process of uplisting to a major exchange by the end of this year. If the company failed to complete both of those goals by the start of 2022, I was going to liquidate the majority of my position until the company is able to address these concerns.
Now, I am going to toss that list in the trash and will be moving my time horizon out several years to allow the company time to prove their cancer and NASH efforts have legs, which could drastically change the company’s valuation.
Next Move
The ongoing proxy battle damaged the share price over the past few months and the announcement of an adjournment of the annual stockholders meeting due to the lack of quorum appears to have accelerated the share price deterioration (Figure 2).
Figure 2: CYDY Daily (Source: Trendspider)
The share price is now just above $1.00 per share with no signs of reversal. Consequently, I am waiting to see if I can see if the $1.00 mark will turn into support, which could allow indicators to start showing some strength. Once I see some sign of support and potential reversal setup, I will make a large addition to being divided into some “trading shares” and “investment shares.” I will look to unload most of the trading shares just below $1.50 and will use the profits for my next “investment buy.”
Quote:"...the company has validated their approach with their recent data which exhibits Leronlimab’s potential to be a legitimate “miracle drug.” If Leronlimab is approved in its current indications it could easily be a blockbuster drug in several years."
The writer is a trader who's decided to build a long-term position, but he/she will still continue to trade a portion of their holdings. Even so, the simple idea of buy and hold should strike some of their readers.
The piece was written before the most recent video by NP told us that the interim analysis in Brazil will be for fewer patients.
Here's the full text, in case, Seeking Alpha wants you subscribe:
Cytodyn (OTCQB:CYDY) recently reported data from their NASH and triple-negative breast cancer studies using Leronlimab. The data revealed impressive results in both indications which will improve the outlook for their late-stage trials prospects for approval. What is more, this data validates Leronlimab's potential seen as a “miracle drug.” The steady sell-off has provided investors an opportunity to accumulate shares at a cheaper valuation, which could be held for a long-term investment. I intend to review the recent data and we'll discuss why I think adequate enough to switch my game plan from a short-term strategy to a long-term investment.
NASH Data
CytoDyn publicized preliminary marks from five patients in its 90 patient Phase II trial for NASH. These initial discoveries from these five patients treated with Leronlimab proposed that all five patients experienced a decrease in fatty deposits “by as much as 45%” from baseline. Furthermore, four out of five patients experienced a decrease in fibrosis “by as much as 10%” from baseline.
This data suggests that Leronlimab may impede liver fibrosis seen in NASH. It appears that Leronlimab could be deployed to patients with nonalcoholic fatty liver disease “NAFLD”, to prevent patients from developing NASH. The company expects to report additional data in the next month or so and is anticipating starting a Phase IIb/III protocol with a biopsy in January. What is more, the company believes there is a potential for Leronlimab to get a Breakthrough Therapy Designation in NASH.
At the moment, there are no FDA-approved treatments for NASH despite 30-40% of adults in the U.S. having NAFLD and 3-12% having NASH. So, if all goes well, Leronlimab will be the first or one of the first therapies in a huge NASH market opportunity.
mTNBC Data
The company also announced results from its CCR5+ Metastatic Triple-Negative Breast Cancer “mTNBC” study using Leronlimab in patients who had previously failed at least two lines of therapy. This analysis was from 28 pooled patients with 16 of the patients coming from the company’s Compassionate Use Study, 10 from the Phase Ib/II Study, and 2 from the Basket Study. It was discovered that 75% of the patients who produced a decrease of circulating tumors cells after Leronlimab had a 3600% increase in 12-month OS. This is a substantial improvement over the 980% increase in OS reported back in August. The analysis also revealed a 580% increase in 12-month PFS. As result, the company is “preparing a Breakthrough Therapy application to be submitted to the FDA this week.”
If Leronlimab is able to demonstrate its ability to reduce CTCs, increase PFS, and improve OS, it could cause a paradigm shift in how the world treats mTNBC.
Switching the Game Plan
Although I have always planned to hold a core position in CYDY, my strategy has been focused on trading the ticker rather than slowly accumulating a position. This decision was based upon the volatility of the ticker and the company's affinity for press releases which allowed me countless opportunities to buy and sell for a substantial profit.
Despite my bullishness and the company's upside potential, I have always lacked the conviction to hold the majority of my position because of the company's decision to initiate numerous clinical programs and trials for Leronlimab without securing at least one FDA approval.
I was concerned the company was spreading itself and its financial position way too thin, which prevented me from holding a large position for an extended period of time. Now, the company has validated their approach with their recent data which exhibits Leronlimab’s potential to be a legitimate “miracle drug.” If Leronlimab is approved in its current indications it could easily be a blockbuster drug in several years.
Figure 1: CytoDyn Programs for 2021 (Source: CytoDyn Presentation)
This has encouraged me to stop trading CYDY and switch to a more long-term investment approach. I believe this data has added a whole new element to the bull thesis and will make cancer and Nash updates more potent as the timeline 4 a potential approval shortens. I believe we've seen enough data from the triple-negative breast cancer studies to expect positive results in future readouts and studies, which has provided me with enough confidence to start accumulating before these programs finish pivotal trials.
Indeed, I'm not going to go "all-in" at this point of time, nor, am I going to commit to an upsized position before CytoDyn is officially a commercial-stage company. So, I plan to have a dual strategy of still trading some shares while accumulating some for a longer-term position. The trading shares will be used to generate some profit, while the investment chairs will be bought periodically as long as the price is below $1.50 per share. If the share price climbs above $1.50 per share, I will only trade CYDY until it drops below $1.50, or the company announces a development that moves my "buy level" higher.
Remaining Cautious about Downside Risks
Although the recent updates have provided me with enough confidence to expand my time horizon on CYDY, I am still remaining cautious at this point in time. The company continues to expand Leronlimab’s potential uses, while still failing to get the HIV BLA resubmitted. I understand the company had to go back through and redo some tedious tasks to appease the FDA. However, the protracted timeline to the HIV BLA resubmission is hurting investor sentiment and prolonging the cash burn.
What is more, the company was hoping to see the interim analysis for their COVID-19 programs in Brazil before year-end, but the company announced they treated their first patient a little over a week ago. The company needs 127 patients to complete their 28-day trial before they are able to get an interim analysis, so the company is going to need to get at least 127 patients dosed by the start of December in order to hit their goal timeline.
Obviously, missing the goal date by a week or two won’t make too big of a difference fundamentally, however, I suspect investors will start to doubt the program if we get to February and the company has failed to provide an update on their Brazilian trials. At that point, Merck (MRK) would probably have a EUA for their antiviral drug, which would hurt Leronlimab’s commercial prospects in COVID-19 and damage the share price.
Essentially, all of the company’s previous mishaps are still lingering and the company’s efforts to have investors turn their attention to NASH and cancer is not going to make those issues disappear. Consequently, I am going to keep CYDY to a 1/3-1/2 sized position until the company has proven they can get Leronlimab approved in at least one indication and collect product revenue.
Adjusting the Ditch List
In addition to changing up my game plan, I am also adjusting my "ditch list" to focus more on the clinical data rather than executive decisions. My previous "ditch list" required CytoDyn to receive FDA approval for Leronlimab in HIV in combination with HAART, and the company starting the process of uplisting to a major exchange by the end of this year. If the company failed to complete both of those goals by the start of 2022, I was going to liquidate the majority of my position until the company is able to address these concerns.
Now, I am going to toss that list in the trash and will be moving my time horizon out several years to allow the company time to prove their cancer and NASH efforts have legs, which could drastically change the company’s valuation.
Next Move
The ongoing proxy battle damaged the share price over the past few months and the announcement of an adjournment of the annual stockholders meeting due to the lack of quorum appears to have accelerated the share price deterioration (Figure 2).
Figure 2: CYDY Daily (Source: Trendspider)
The share price is now just above $1.00 per share with no signs of reversal. Consequently, I am waiting to see if I can see if the $1.00 mark will turn into support, which could allow indicators to start showing some strength. Once I see some sign of support and potential reversal setup, I will make a large addition to being divided into some “trading shares” and “investment shares.” I will look to unload most of the trading shares just below $1.50 and will use the profits for my next “investment buy.”
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