In a Feb. 20 research note, H.C. Wainwright & Co. analyst Ram Selvaraju reported that CytoDyn Inc. (CYDY:OTCQB) plans to launch preclinical studies of its leronlimab (PRO 140) monoclonal antibody in eight cancer indications at a total cost of $1.5 million. Leronlimab blocks CCR5, which plays a role in advancing cancer metastasis and HIV.
These studies, one each being conducted in melanoma, pancreatic cancer, breast cancer, prostate cancer, colon cancer, lung cancer, liver cancer and stomach cancer, could generate data to support Phase 2 investigational new drug applications. Should they prove positive, CytoDyn intends to "evaluate several opportunities with multiple Phase 2 trials in cancer," wrote Selvaraju.
Regarding dosage of leronlimab, the FDA has instructed CytoDyn to use 700 milligrams (700 mg) and is allowing the company to switch all patients on the lower 350 mg dose in current studies to 700 mg, Selvaraju relayed. The 700 mg in the monotherapy trial yielded a higher response rate than the 350 mg in the combination study.
Additionally, the FDA indicated it will accept safety data concerning the 100 patients on 700 mg in the monotherapy trial. CytoDyn will be able to use 700 mg in its biologics license application (BLA) for leronlimab as a combination therapy for HIV. Additionally, Selvaraju commented, "given the 92% response rate at 700 mg, we believe the company should have a more persuasive data package of leronlimab for its upcoming BLA submission," expected in Q2/19.
H.C. Wainwright has a Buy rating and $1.50 per share price target on CytoDyn, whose stock is currently trading at around $0.51 per share. Because the financial institution's estimated value of leronlimab does not include its potential cancer applications, positive results in this regard "could drive additional upside to our price target," noted Selvaraju.
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Disclosures from H.C. Wainwright & Co., CytoDyn Inc., Company Update, February 20, 2019
Investment Banking Services include, but are not limited to, acting as a manager/co-manager in the underwriting or placement of securities, acting as financial advisor, and/or providing corporate finance or capital markets-related services to a company or one of its affiliates or subsidiaries within the past 12 months.
I, Raghuram Selvaraju, Ph.D. and Yi Chen, Ph.D. CFA , certify that 1) all of the views expressed in this report accurately reflect my personal views about any and all subject securities or issuers discussed; and 2) no part of my compensation was, is, or will be directly or indirectly related to the specific recommendation or views expressed in this research report; and 3) neither myself nor any members of my household is an officer, director or advisory board member of these companies.
None of the research analysts or the research analyst's household has a financial interest in the securities of CytoDyn, Inc (including, without limitation, any option, right, warrant, future, long or short position).
As of January 31, 2019 neither the Firm nor its affiliates beneficially own 1% or more of any class of common equity securities of CytoDyn, Inc.
Neither the research analyst nor the Firm has any material conflict of interest in of which the research analyst knows or has reason to know at the time of publication of this research report.
The research analyst principally responsible for preparation of the report does not receive compensation that is based upon any specific investment banking services or transaction but is compensated based on factors including total revenue and profitability of the Firm, a substantial portion of which is derived from investment banking services.
The Firm or its affiliates did not receive compensation from CytoDyn, Inc. for investment banking services within twelve months before, but will seek compensation from the companies mentioned in this report for investment banking services within three months following publication of the research report.
The Firm does not make a market in CytoDyn, Inc. as of the date of this research report.
