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Monday, December 5, 2022

Todos Medical (TOMDF) & CYDY are Two Biotech Plays to Watch Monday After the Merck Expose

Todos Medical (OTCMKTS: TOMDF) and CytoDyn Inc. (OTCMKTS: CYDY) might be looking at a pretty good week ahead of them.  in a recent article there were a lot of comments about leronlimab and Tollovir.  In the article it broke down the mechanism of action of Molnupiravir which was the top headline on Friday which almost single handedly moved the market higher.  The sell off in both CYDY and TOMDF was probably attributable to the investor rationalization that now a magic bullet exists to treat COVID-19 early; it was therefore time to trim Covid therapeutics because they won’t be necessary.  Over the weekend it’s become clear that Molnupiravir is no savior let alone a magic bullet and the road to approval is still a rocky one given the campaign to continue vaccinations. It also became clearer that both leronlimab and Tollovir might really have a better solution than a vaccine for the entire spectrum of disease.   

Merck (NYSE: MRK) is expected to be under pressure Monday as the euphoria starts to wear off and reporters start to dig and ask questions. Likewise vaccine stocks like Moderna (NASDAQ: MRNA), Pfizer (NYSE: PFE), BioNTech (NASDAQ: BNTX), Johnson & Johnson (NYSE: JNJ), Vir Technology (NYSE: VIR), and Novamax (NASDAQ:NVAX) are expected to rebound. The key points that were uncovered is that Molnupiravir is for a very limited population of patients.  It’s not for the masses, but that is precisely what investors assumed when the news broke.  Many failed to read the fine print that the drug was for unvaccinated people which happens to be a shrinking demographic and people with at least one underlying condition. Other antivirals like Pfizer’s oral antiviral are designing the same sort of clinical trial of exclusion.    

The article got over 35K hits at the time of writing, and was the top contributor article for 2 days running.  Many people got to see that Merck’s drug has a serious issue of mutagenicity.  It’s not a good idea to take Molnupiravir if you are pregnant or a man having sexual intercourse.  This point was clearly for shock value because who in their right mind would be having sexual intercourse while they have COVID-19.  The rest of the content was on point.  There are two biotechs that seem to be able to treat the entire spectrum of disease so this paired trade of CYDY and TOMDF is a good investment thesis if you believe the vaccination only strategy is flawed and that therapeutics will play an important role in getting out of the pandemic.  

There are still a lot of risks with these two names.  CytoDyn has been under pressure due to a group of disgruntled investors called the 13-D that want to displace management and of course the shorts tolling the InvestorsHub message board.  There is a key hearing on October 6th that will determine whether or not the company has to accept the ballot of the 13-D proxy group. CYDY appears to be in a commanding position because of course they are the incumbent but because they also got the 13-D group to admit they didn’t follow the rules and misled investors.  This one looks like an easy call for those investors that want to put on their lawyers hat.  “Your honor I broke the rules but I’m looking out for shareholders best interests now, not my own” will be the argument of the 13-D group.  Then the company will say 13-D broke the rules, and should they choose to follow the rules in the future they can apply again next year.  There have been many missed deadlines like the BLA filing and the Breakthrough Therapy Designation (BTD), by management that have been taxing investor patience.  Should any of CytoDyn’s initiatives like the Philippines or robust enrollment in the Brazil trial come to pass the stock is due for a mega rally.

Todos has been under a lot of structural pressure.  There was a large institutional seller that exited and was putting a cap on the stock price.  There was a financing and lockup agreement put in place last week that did not achieve much fanfare for the above market price of $.0599, but the large offers on TOMDF did disappear which means the softness in price is due to retail investor fatigue or the Molnupiravir news instead of actual dilution. Should this publicity over the weekend get some traction Monday AM TOMDF could be in for an epic run because as a COVID-10 play they are the only company that has an antiviral for the people now.  The ZeroHedge article broke the news that the drug in development is for all intents and purposes the same as the nutraceutical that can be purchased at www.mytollovid.com.  The company is also due to give some guidance on their clinical trial. TOMDF has also been in the news.  Their CEO, Gerald Commissiong has been dubbed an expert with quite a few recent interviews that include FOX Business, and might be called up to opine on Molnupiravir.   

On a technical basis both stocks are ripe for a rebound.  The 20 day moving average on TOMDF held and saw a nice bounce.  Then CYDY retraced 32% off the high which means it too is ripe to bounce.  With no pressure on the financing side in either of these stocks a good retail push could ignite a short covering rally for the short betting on the end of Covid.  It’s very reasonable that news to capture all the eyeballs on this story will come Monday.  

Besides these well known names other small cap companies working on COVID-19 may finally start to find some bids.  Next to CYDY Ampio Pharmaceuticals (NASDAQ: AMPE) has one of the most promising drugs to treat the Cytokine Storm. In their Phase 1 study they showed a 78% reduction in mortality over the standard of care.  They are currently in the process of initiating a Phase 2 trial of inhaled Ampion in critical COVID-19 patients. Organicel Regnerative Medicine (OTCMKTS: BPSR) is using its Zofin to treat Long Haulers and is shortly expected to unveil its clinical trial. First Wave BioPharma (NASDAQ: FWBI) is screening for its Phase 2b using Niclosamide to treat gastrointestinal issues that result from a concentration of the COVID-19 virus in the gut. It is expected to announce additional sites and any tweaks to the protocol. This stock is very oversold after a botched press release headline that grossly overstated the cost of acquiring their primary asset. Another stock in a strong downtrend with a slight uptick at support is Therapeutic Solutions International (OTCMKTS: TSOI).  They have a nutraceutical that helps modulate the Natural Killer cells through the release of IL-2          

Both CYDY and TOMDF look like they will be part of the therapeutic conversation that is rising to the surface after a deafening message over the past 6 months that only vaccination can save us and that this is a “pandemic of the unvaccinated.”  Washington State’s Surveillance Report health data used to show breakthrough infections as a percentage of the vaccinated and it is no longer being tracked for fear that it will send the wrong message.  This censorship has not gone unnoticed and the media is starting to report on it and asking tougher questions like Sara Eisen at CNBC. This groundswell movement for therapeutics could usher in a new renaissance in therapeutics. There is tremendous opportunity to get back into COVID-19 therapeutics. We will be updating on CYDY and TOMDF so make sure you Subscribe to Microcapdaily so you know what’s going on with with both.        

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