The CytoDyn Inc (OTCMKTS:CYDY) stock went into a meltdown yesterday after the company got a stinging rebuke from the United States Food and Drug Administration.
On Monday, the FDA rebuked CytoDyn for having been selective with regards to the selection data from the two studies of its COVID 19 treatment leronlimab. The FDA alleged that the company tried to show that the product was effective against COVID 19. Both those studies had in fact been failures.
It goes without saying that the development was a major setback for the company and that was reflected in the price action in its stock as well. The CytoDyn stock tanked by as much as 27% yesterday as investors rushed for the exits.
Earlier on this year in March, the Phase 3 clinical trial of leronlimab had been a failure as the product failed to demonstrate its primary target of reducing the effects of symptoms. It failed to meet all the secondary goals as well.
However, CytoDyn decided to turn its focus on 62 seriously ill COVID 19 patients, who had been given mechanical ventilation and concluded that leronlimab helped in reducing all cause mortality by as much as 24%. The company went on to state that the product could also reduce hospitalisation by six days.
The FDA is usually known for being silent when it comes to products which are not approved, but in an unprecedented move the agency dished out a public rebuke to CytoDyn. The agency said that none of the analyses that had been conducted by CytoDyn had been statistically significant.
The agency also stated that the data did not reveal anything that could support the clinical benefits of leronlimab when it comes to the treatment of COVID 19 patients. The agency also stated how clinical trials work which must have come as a further source of embarrassment for CytoDyn.