On Wednesday, Aytu Biosciences announced the successful closing of its warrant tender offer, grossing approximately $2.2 million before customary fee's and expenses are deducted. Net cash available to AYTU will be approximately $2 million, which is expected to be used for working capital and general corporate purposes.
Strength In AYTU Platform Inspires Confidence
Investors just got themselves a deal. At .75 cents, the shares offered a small discount to current market prices, but for those savvy enough to have discovered AYTU at this stage of development, they may be well positioned for a significant ride higher in share price.
With the 2,991,041 shares tendered in the warrant offering, total outstanding shares now stand at approximately 13.8 million shares, a relatively small number of shares that leaves plenty of fire power in the arsenal for future raises, unless they seek strategic opportunities that may very well find their way into the AYTU board room.
AYTU Opportunities Enhanced
Board room? Yes, that's what I said, and for good reason.
For investors that missed the article touting the unbelievable opportunity that is facing AYTU, the "board room" comment might make little sense. But, for those that understand the potential power of AYTU's ,Natesto, the ONLY FDA approved nasally administered low testosterone therapy, the opportunity is ripe for AYTU to formidably address a multi billion dollar, and win.
Actually, AYTU could win far sooner than later, if only the FDA had the fortitude to take a stance against large pharma and stop allowing harmful drugs to be commercialized to the extent that hundreds of thousands of men are at risk, each year, of severe and potentially life threatening events. It's hard to cut the FDA a break on this one, because they clearly know the potential harm being reported on a regular basis by TRT drugs marketed by Abbvie, Endo, Upsher-Smith, and others. And, they are also fully aware that in Natesto, there is an alternative treatment that has shown none of the potentially life threatening risks, but has delivered essentially all of the same benefit..
Natesto Is A Game Changer
Let's get the first point out of the way, and if you are a patient taking a TRT drug, pay close attention. Natesto is the ONLY low testosterone replacement product, approved by the FDA, that does not require the dreaded Black Box Warning be boldly embossed on their label or box. To spell it out in simplest terms, Natesto is the only low testosterone drug that the FDA is fully convinced will not cause a heart attack, contribute toward prostate cancer, cause a reduced sperm count, or cause your wife or significant other female friend to grow a beard.
But, the FDA was not so kind to other products. The makers of AndroGel, by AbbVie, or Axiron, by Eli Lilly, or Fortesta and Testim, by Endo pharmaceuticals all have the bold, BLACK BOX WARNING clearly demonstrated on their packaging. Each of those companies, despite offering similar claim of benefit to AYTU's, Natesto, is plagued with disclosures, some life threatening.
This is strange. One large pharmaceutical company, Upsher-Smith was even provided marketing approval for their TRT product, Vogelxo, despite the fact that they admitted to have not finalized safety and adverse effect data in the trial groups. Why, FDA, Why?
For any patient that does not adamantly express their desire to be prescribed nothing other than Natesto to treat TRT, well, I have one thing to ask.... Can I go to Vegas with you, because you are one lucky cat to still be alive?
No Exaggeration. The Truth Is Written
As crazy as it reads, I am not exaggerating about these other low testosterone treatment options. And, I am not exaggerating that the only benefit over Natesto, for now, is the marketing budget being thrown all over these products, despite the numerous lawsuits pending against Abbot, Lilly, Endo and Upsher Smith. While these companies products potentially harm unsuspecting men, and perhaps cause unintended side effects to their women and children, the large companies simply set up a reserve fund to pay the damages once these suits get settled. But, money can't cure everything.
Before I forget, let me list the unintended consequences for accidental transfer of the topically applied low testosterone products? Well, in the very likely case that any amount of testosterone gets transferred from a counter top, a shirt, bare skin, or even from a shampoo bottle, females can expect to feel real manly, perhaps growing a beard or becoming a potential contestant in the next Mr. Universe contest. For children, the risk is even greater. As well as significant illness, girls can be subject to induced male traits, inclusive of a full mustache by the age of twelve, and biceps potentially larger than Popeye's.
Seriously, I am being serious.
Natesto must become the go to product for TRT treatments. Being the only nasally administered therapy, the likelihood of inadvertent transfer is minimal, and the effects have shown to be just as efficacious as any other well known brand.
The FDA should do its job and stop the madness now. Physician's should be mandated to explain treatment options. Natesto, for instance, is equally efficacious to topical applications. AYTU performed a pivotal clinical trial studying the safety and efficacy of Natesto, and 91% of the patients in the test group achieved normal testosterone levels by day ninety. Equally impressive, over 70% of the patients in the twice daily Natesto treatment group achieved normal testosterone levels at day ninety as well. As for the erectile dysfunction portion, you know, having the means to act when the time is right, well, Natesto caused statistically significant improvements in each of the five domains of erectile function, with the majority of the effect on erectile dysfunction evident by day thirty. In other words, their ability for a more pronounced sexual performance increased significantly within a month.
No, I'm not being paid to write this, consider me a humanitarian that is working really hard to inform people of serious potential risk in using products other than Natesto. Facing the truth, the FDA has been just as rigorous on Natesto as they have been on others. In fact, they are so adamant that AYTU post the significant and potential side effects of Natesto on the label, that AYTU complied.
Top two side effects: Natesto may cause a headache. Natesto may cause a runny nose. And the bonus, NO BLACK BOX WARNING!
This is what men need to understand. Patients, in brands other than Natesto, are being prescribed a TRT treatment that can cause cancer, unwanted hair growth on women, enlarged breast in children, enlarged red blood cells, and potentially death from complications of effects. For Vogelxo, we don't even know, because the FDA has allowed Vogelxo to be commercialized without them even completing a full safety and tolerability profile.
Where Natesto Should Be
AYTU is small, but they are growing. Knowing that Natesto has an enormous market opportunity, and has a full suite of commercialized drugs, is an invitation to get acquainted to a stock that has tremendous upside potential. Assuming that Natesto gained some marketing traction and managed to to persuade physicians to prescribe Natesto just 5% of the time, amassing just 5% of total market sales. That would equate to over $100 million in revenue from the expected $2 billion a year industry. But, lets assume that the FDA did its job and pulled these high risk products from the market, unlikely, but they should. This could lead to exponential sales of Natesto, addressing a $2 billion market almost all by its lonesome.
Think it can't or won't happen, rethink that hypothesis. There are a number of lawsuits progressing through the courts at this very moment. Once these begin to settle, expect some of the competition to be pulled. Precedent is a nasty word to large pharma, and they know when to cut losses. But, remember when I mentioned the board room at AYTU? Well, this is where it all may eventually end up, assuming that a potential suitor brings both their check book and a credit card.
Natesto is a game changer, and a proven winner in regard to efficacy, safety and tolerability. Management knows the value and it won't be given away on the cheap. Best case scenario, the FDA begins to table these TRT products that have consistently and unequivocally damaged the health of men, in some cases leading to their death. At that point, Natesto stands clear, and while some may get a headache or a runny nose from Natesto, having an aspirin and a tissue in his pocket is much more manageable than losing a nut.
Investors, take the lead...study about AYTU, learn about Natesto, and challenge me where I have gone wrong. Once you concur, join the voices that are calling for a more responsive FDA that should be willing and aggressive in stopping harmful drugs from being marketed to unsuspecting patients.
The time for Natesto is coming, and while it may take a short while for AYTU to build a marketing machine able to inform the mass of medical professionals as to the benefit of Natesto, there is one thing, in the mean time that is almost certain. If you tell a friend or loved one about the potential efficacy, health and safety benefit in using Natesto over another major brand, you may very well be giving them the greatest gift of all. The gift of life.
This article first appeared on CNA Finance
Disclosure: I am/we are long AYTU.