Enzolytics Is Surrounded By Controversy And Could Be Worthless

Summary

• The company recently merged with BioClonetics and plans to develop treatments for HIV and COVID-19.
• However, there are no revenues and its Bulgarian partner denies that Enzolytics has a stake in it.
• Enzolytics has a valuation of $982.1 million but I don’t think the business is worth much in its current state.

Introduction

Today, I’m taking a look at Enzolytics (OTCPK:ENZC), a drug company that was recently covered on SA by fellow contributor QQQ Investments.

However, I think that article didn’t focus enough on the controversies surrounding the company as well as the transformation acquisition of BioClonetics, which is focused on developing fully human monoclonal antibodies targeting HIV and the SARS-CoV-2 (COVID-19) virus.

Enzolytics is valued at $982.1 million as of time of writing and I think it’s a sell.

Overview of the business

The flagship compound of the company is named Immune Therapeutic Vaccine-1 (ITV-1) and represents a suspension of Inactivated Pepsin Fraction (IPF) that could be effective in the treatment of HIV/AIDS.

Enzolytics claims that its ITV-1 peptide was tested against human coronavirus 229E Strain (HCoV-229E) at the National Centre of Infectious and Parasitic Diseases in Sofia, Bulgaria. Here’s the thing though, I live in Sofia and I can't find information about this study in local sources.

The company says the study was carried out by Petia Genova-Kalou. Looking up information on her on the Internet, it appears she’s involved with a dietary supplement named EnzoImmune Active, which can be bought in Bulgaria for around $41 per bottle.

(Source: EnzoImmune Active)

This dietary supplement is being distributed by Rosetta Lifecare Bulgaria and some investors seem convinced that EnzoImmune Active is a product of Enzolytics.

However, I couldn’t confirm this and Enzolytics didn’t report any revenues in the first nine months of 2020.

(Source: OTC Markets)

Looking at the balance sheet, Enzolytics barely had any cash reserves as of September and its shareholders’ equity and working capital positions were negative.

(Source: OTC Markets)

Enzolytics says it owns a 49% stake in a Bulgarian company named Immunotech Laboratories (OTC:IMMB).

However, the latter has released this statement, disputing the share structure and

Analyst’s Disclosure:I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. 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 am not a financial adviser. All articles are my opinion - they are not suggestions to buy or sell any securities. Perform your own due diligence and consult a financial professional before trading.