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CytoDyn: Uncovering An Opportunity

Jun. 12, 2019 9:05 AM ETCytoDyn Inc. (CYDY)PGNX78 Comments


  • CytoDyn is moving their PRO 140 product candidate closer towards an FDA approval in HIV. I recall how I discovered CYDY and my plans for starting a speculative position.
  • PRO 140 has displayed remarkable results in HIV but the company continues to put the CCR5 antagonist on display in oncology and inflammatory indications.
  • I discuss some some of the potential downsides of investing CYDY, including the hazards of investing in OTC stocks.

I discovered CytoDyn (OTCQB:CYDY) when performing research for an article on Progenics Pharmaceuticals (PGNX). As I was reading through PGNX SEC filings, I saw a few references to Leronlimab (PRO 140), a fully humanized monoclonal antibody treatment for HIV that CytoDyn acquired from Progenics back in 2012. On the word of the deal, Progenics is to collect $5.0M upon FDA approval, along with a 5% royalty of net sales from CytoDyn. When performing research about the treatment, I uncovered a copious amount of positive analysis about PRO 140 from corresponding Seeking Alpha biotech writers. Indeed, CytoDyn has estimated a $3B market in combination with HAART and an $11B market as a monotherapy for HIV. Moreover, CytoDyn is looking to start or progress 8 pre-clinical studies for PRO 140 for the management of breast, colon, melanoma, pancreatic, prostate, lung, liver and stomach cancer.

Ultimately, I ended up investing in PGNX but I was captivated about the prospects of PRO 140 and CYDY market valuation. With the recent market sell-off, I am looking for a few more speculative biotechs that are on the brink of transformational growth. I believe CytoDyn fits these criteria and the recent company developments have moved CYDY to the top of my buy list. My goal is to lay out a case for a speculative buy ahead of the anticipated 2nd and 3rd portions of the BLA before the share price experiences a strong run-up towards an approval. In addition, I reveal my plans to manage that position moving into 2020. On the other hand, I will discuss my reasons for keeping my position size small and on a short leash for the remainder of 2019.

PRO 140 Overview

CytoDyn is a biopharmaceutical company that is focused on the clinical development and commercialization of their flagship product candidate

This article was written by

Biologics profile picture
Diagnosing the market to compound capital in the healthcare sector.

After years of working in the medical field, I have developed a passion for biotech and lifesaving therapies. Now, I am a full-time healthcare investor who is in search of the next breakthrough therapy, device, or pharmaceutical. My trade focus is around catalysts and potential acquisitions. In addition, I provide a marketplace service, Compounding Healthcare through Seeking Alpha.

Analyst’s Disclosure: I am/we are long PGNX. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

I have no position in CYDY, however, I may enter a long position over the next 72 hours.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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