Disclaimer: VFC has no affiliation with Cel-Sci Corp or with any third parties associated with the companies. VFC has received no compensation for this blog post, although there may be an unrelated advertisement or two at various locations on this blog. VFC does not offer advice or investment services and nothing you read here should be construed as such. VFC is just a guy with an opinion and access to a computer and a keyboard; bringing discussion and ideas to the table. #AhYeah.
Shares of Cel-Sci Corp (CVM) are hot and in the spotlight these days after the company announced last week that the last "event," or death, necessary to complete data analysis for its global Phase III trial testing Multikine in the treatment of head and neck cancer had occurred. After nearly a decade of waiting through many peaks and valleys of trading for CVM, investors were elated that the trial results are finally on their way. There is much speculation, however, as to just how long the wait for analysis will take.
According to the press release, "The database is now being prepared for database lock. Once the database has been locked the final analysis of the trial results can be performed." A write up by Zachs a few days ago does a pretty good job of outlining which steps may take place between the last event and data release. A few of those steps could take a little bit of time, especially in the middle of this Covid19 pandemic that we are experiencing. Zachs also mentioned the possibility of the data being discussed at an upcoming conference later this year.
To sum it all up, it is a guessing game for us as to when the results will be released. There is little doubt in my mind, tho, that there will be an announcement of some sort (press release or press event) to announce positive results as soon as there is an indication that the trial met its endpoint. Judging by the public information and established time frames available to us on the Internet, I would guess we would see that anywhere from mid-June to early July. That's just VFC's humble opinion. There are those that believe we will see results much sooner and those who believe they will be announced much later - timelines vary as we do not have the exact date of when that last death occurred, so the database lock and final steps of completing the trial could be further along than we suspect.
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One item of caution I will be watching for is if trial results are going to be announced at a conference, or in scientific journal. That would indicate, to me, that the endpoint was not explicitly met, but that there was enough benefit there for the data to be presented in a way to justify additional studies of Multikine's effectiveness and efficacy in order to achieve an FDA approval. Such a scenario would not be nice for the share price and the short sellers would jump all over the situation.
Regardless of how promising the situation looks for Cel-Sci right now - the latest IDMC recommendation to continue the trial "without change" is taken by some as a 'thumbs up' of trial success since the recommendation came so late in the game - it is important to still entertain all possibilities, as there is not sure thing int eh stock market and especially in the world of small cap biotech. Therefor, I would raise an eyebrow if we had to wait for a conference later in the year to hear results.
That said, there is a lot of positive vibes regarding this trial. Judging by the late-year option premiums (as opposed to the June out of the money calls, for example), it appears that investors are speculating that results will probably come late summer, early fall, and not necessarily by the June expirations. The high premiums for the calls indicate a pretty amazing price spike if the results are positive - as investors have surmised all along this journey.
It's also a positive that institutional ownership keeps ticking upwards and insiders have purchased up some shares over the past year or two, investors love to see management putting their own skin in the game. You can track much of this stuff over at KillCVMShorts.com.
As we've discussed for a while now, positive results are going to propel CVM shares much, much higher and attract possible buyout offers and a whole lot of big money. Multikine, upon success, would be positioned to be a new addition to the standard of care for head and neck cancer before potentially being evaluated for efficacy in the treatment of other cancer types. On the flip side, a miss on results would plummet shares to below a buck, in my opinion.
LEAPS is still a wild card. Governments around the world have been throwing money all over the place to find treatments and / or a cure for the Caronavirus, so there is always the possibility that government funding could come to Cel-Sci for its collaboration with the University of Georgia in testing LEAPS for the treatment of Caronavirus. Funding would help to legitimize the collaboration to those who still consider LEAPS nothing more than a PR stunt and could propel shares to over the twenty buck mark pretty easily, setting up a nice base before Multikine results arrived.
There will be a lot of volatility in CVM until these results are released, that's pretty obvious. The day, swing and momentum traders will all be in there and there are sure to be a swatch of catalyst traders coming in just to play the "buy the rumor" game. It's also possible there will be a short attack at some point, like the one experienced by Dendron (DNDN) years ago, which would open up a nice buying opportunity for those wanting to dip in for some discounted shares before the news.
As always, CVM is a Multikine results play - boom or bust. The time to trade in and out has just about passed as results could come at any time now. Those banking on a positive outcome will be picking up a few shares (or call options) on any dips, those banking on negative or inconclusive results will be playing the put option game. Some will be hedging calls and puts to minimize losses and maximize gains in either event.
VFC is sitting on house money just waiting along with everyone else.
The time is quickly approaching that we will have some closure on what for some has been more than a decade of following this groundbreaking trial and potentially groundbreaking new treatment for cancer.
Disclosure: VFC is long CVM.