he ad we’re looking at today is a somewhat updated pitch from Ray Blanco, it’s basically a replay of a “live briefing” ad presentation that came out in March for his Catalyst Trader newsletter ($995/yr, no refunds but “you get another year free if the stock doesn’t go up 20X”), and that ad was was an update of a presentation he released last Summer as an “Urgent Buy Alert” for this “20X Opportunity” arthritis cure. The ad and order form carry a “March 2023” date now, but the original recommendation and “special report” came out in June or July of 2022.

This is intended to be a shorter-term trading service, betting on “catalyst” events (back when Paradigm Press was still called Agora Financial, Blanco’s similar service was called FDA Trader), and the previous versions of the ad were all about the shocking results this company was “about to release,” driving huge overnight riches your way… and that didn’t happen, the very limited clinical trial results they’ve released so far were not particularly dramatic… so the latest version of the ad has shifted focus — he now highlights the patent the company was granted, and the fact that Ray Blanco thinks it could become the most valuable patent in the world, curing a disease that afflicts 54 million people.

This is the headline of the latest version of the ad:

“Is Patent No. 11,219,620 The Most Valuable Patent In History?

“TINY STOCK WINS MAJOR PATENT!

“ACT FAST! This Story Could Hit The Mainstream Media Just Days From Now…”

The patent he’s talking about, not to jump too far ahead, was granted in January of 2022 (as is typical of drug patents, it was applied for as they were doing their preclinical work on the compound, and granted a little before the clinical trials actually started).

This is essentially the promise, and it is pretty much the same semi-generic promise that Ray Blanco and many other biotech pitchmen have made in their ads for years:

“Any day now, one tiny company is going to make an announcement that will shock the world” and be on all the front pages… and the scientist behind this company will one day win the Nobel Prize.

And while the ad doesn’t drop specific dates this time, we know from the versions of this ad that ran last month that Blanco was looking at the March 20, 2023 publication of results from the company’s testing as the key update that would drive the stock higher. He still refers to it as a “$87 million” stock, which is roughly where the value of this “secret” company was both when he first pitched the stock, in July of 2022, and when the ad campaign revved up again in the first week of March, 2023, (in the interim, it has been wildly volatile, hitting both $200 million and $40 million over the past year).

I won’t dig through the entire video again, but we did cover this same story last August, and I updated my thoughts a little bit on March 20… but we can get a little more detailed now.

And Ray Blanco also says out loud what many editors imply: He says he’s “putting his entire reputation on the line” in predicting this winner, and that it’s the biggest idea of his career. I don’t remember him ever NOT saying something along those lines when teasing a stock, but, well, he wants you to really believe that he’s sure.

Sure about what, you say? This new drug is apparently a “Humira competitor” …

“This company may have just changed the way we think about and treat arthritis forever.

“They’re going to take the stage and stun everyone as they announce that to the public, stunning everyone, and sending the stock parabolic.

“This drug is… 70% more effective than the world’s current leading arthritis drug, Humira.”

That’s paraphrased, but you get the point (they didn’t provide a transcript of the ad, sadly, so I’ve had to actually listen to the damn thing a couple timew).

And the word “Humira” makes investors perk up their ears, for sure, because that is by far the top-selling drug in the world (for AbbVie (ABBV)). Will this “tiny stock” really develop the “miracle drug” that takes over Humira’s spot?

Humira is not really a “regular” arthritis drug — it doesn’t do anything for osteoarthritis sufferers (which is most of us), but it is approved for rheumatoid arthritis, which is an autoimmune disease, and a bunch of other inflammatory diseases, like psoriatic arthritis, Crohn’s disease, ulcerative colitis and some other conditions that I’ve never even heard of.

So if you’ve just got achiness from your cartilage wearing down, like me, sorry, we’re not looking at a massive cure just yet. Those big numbers of people that Ray Blanco throws around are for osteoarthritis, which hits about a quarter of adults at one point or another (50-60 million people in the US)… rheumatoid arthritis, thankfully, hits a much smaller patient cohort (~1-1.5 million Americans, with women much more likely to get the disease than men — something between 1-3% of women are likely to get RA in their lifetime).

So what’s this “one tiny stock?” Thinkolator sez that Blanco is (still) pitching MyMD Pharmaceuticals (MYMD), which came public through a reverse merger with a failing biotech company called Akers Biosciences about two years ago. The stock hasn’t done a whole lot since then, but, as befits an early-stage clinical pharmaceutical company, it has had some jolts up and down on bits of news about its progress (and as folks like Blanco have blanketed the airwaves with pitches for the stock). The stock price has been on a fairly steady downward trend, with bursts of optimism but still a share price that was indeed around $5 last August, when I first covered the ad, and is now around $1.75.

They are focused now on MYMD-1, which is an anti-inflammatory drug (a TNF-α inhibitor, like Humira) that, yes, might tackle some of the same diseases as Humira — though that hasn’t really been proven in clinical trials yet.

That patent number that Ray Blanco cites in his headlines now is real, though it’s not new — all compounds that companies hope to turn into drugs are patented, usually pretty early on in the process of testing the drug to see if it works and is safe enough for human beings. That patent number 11,219,620 is titled “Methods of treating sarcopenia”, and that is indeed the application they’re currently testing for MYMD-1, in phase 2 trials.

That Phase 2 trial for sarcopenia, which is the loss of muscle mass usually associated with aging, is still underway. The update two weeks ago, on April 12, was that their sarcopenia trial for this same drug, MYMD-1, in 30 patients, had not uncovered any safety or toxicity issues… so that trial is moving forward, they’re just about to dose the final ten patients at the final (highest) dose level. Presumably this trial will be the first one to give any indication of whether the drug might be effective as an anti-aging treatment in human beings. As of their annual report (which came out about a month ago), they expected to have final efficacy data for the sarcopenia trial in the second quarter… so, sometime in the next two months.

The arthritis stuff is what people are really daydreaming about, however, and on that front we should be careful to note that those results, testing MYMD-1 as a rheumatoid arthritis treatment (and a potential Humira competitor), are still pre-clinical — the “positive data” announced in March came from testing in a “rheumatoid arthritis model” (which means, “a mouse that mimics features of arthritis in humans”). To oversimplify, “clinical trial” means “tested it in people”… “preclinical” means “tested in a lab, in a petri dish, in a computer, or on animals.”

The results in mice continue to be solid, and indicated that it is worth continuing to develop the drug, but that announcement did not change the world. Or the stock price. It will take many years to move this drug to commercial approval even if there are no hiccups or bad results along the way, so MYMD will need a lot more money and a lot of investor patience unless someone in big pharma sees something fantastic in the results and swoops in with a big takeover offer… but we’re at a VERY early stage here, so that, too, is probably years away from being a reasonable hope. Raising money is tough as your share price falls (now below $2), but at least they haven’t had to report any bad clinical trial data at this point.

They have “failed to amaze” so far, in other words, but the drug has not actually failed… all we know is there haven’t been any safety issues, we don’t really know anything about whether or not the drug will work in the real world.

As far as I can tell, they have not yet tested MYMD-1 in a human being with rheumatoid arthritis, but they’re planning to do so soon — the latest investor presentation indicates that they plan to submit an IND application to the FDA to begin that clinical trial sometime in the second quarter, start recruiting in the third quarter, and begin dosing in the third quarter as well, and they’re calling this a “Phase 2” trial, jumping past Phase 1 (don’t know why).

That might be a bit optimistic, these timelines often slip (the sarcopenia trial took six months to go from FDA clearance to dosing, and it’s been underway for more than a year so far but they’re just now getting to dosing the final cohort of patients). Perhaps they’ll have some initial clinical trial results in rheumatoid arthritis within the next year.

Like all pre-commercial biotech companies, MyMD is burning through cash — there’s no money coming in, of course, since they aren’t selling anything, so the normal existence for such companies is that they either have to get partnership deals with larger companies, or they have to keep selling shares to fund their drug development. Both are dependent on good news, particularly from clinical trials.

As of December 31, they were pretty much out of cash again… but they raised about $15 million in February, and indicated that they think that’s enough cash to get them through the year (that’s about the amount of cash they burned through in 2022, so I guess that’s a reasonable estimate — clinical trials probably won’t get really expensive until (unless) they get to Phase 3 and a much larger number of patients).

That $15 million they just raised will be significantly dilutive if the company ever recovers to a higher share price, but nobody is particularly worried about that right now, and because they sold preferred stock and warrants it doesn’t increase the share count immediately — that equity raise consisted of preferred shares (which can be convertible into about 6.6 million shares) and warrants (for another 6.6 million shares), with both keyed on a share price of $2.25 (the preferreds are convertible to effectively give preferred holders shares at $2.25 each, and the warrants have a five-year term and a $2.25 strike price). So that’s a total of 13 million more shares that might be created sometime soon, adding to the 40 million currently outstanding. And that will almost certainly not be the last of it — the cash might get them through the year, assuming they raised all they intended in that offering (I didn’t see any follow-up), but it won’t get them much farther than that… and if the drugs keep moving forward, the clinical development only gets more expensive as they progress (though good news would make it easier to raise money at better prices, one hopes).

So yes, there’s an “anti aging” component here, which always appeals to investors, but the real big-money dream may be “going after Humira” if the sarcopenia news is good, and they’re able to begin testing MYMD-1 in rheumatoid arthritis patients later this year, and the drug shows good results against that disease that are anything like the preclinical model results… but it’s going to take some work and probably quite a lot of time before all those ands have a chance to come together into something big.

The comparison between MYMD-1 and Humira so far comes from that pre-clinical study they announced about a year ago, which is one of the press releases quoted by Ray Blanco — here’s an excerpt:

“‘We are excited about the impressive new data we are announcing today that shows a highly favorable comparison of our lead drug candidate MYMD-1® to the gold standard rheumatoid arthritis drug therapies currently on the market today. A small fraction of this enormous $31 billion market represents a highly attractive opportunity for MyMD,’ said Chris Chapman, M.D., President, Director and Chief Medical Officer of MyMD.

‘Utilizing the strong proof-of-concept and efficacy data from our pre-clinical model, we are preparing to submit to the FDA an Investigational New Drug (IND) application for MYMD-1® as treatment for RA, along with protocols for a Phase 2 study, in the second half of this year.'”

Last summer, we told you that “probably it will take longer than that,” and that is indeed the case… perhaps they’ll get the IND submission for RA in the first half of this year, as planned, but we shouldn’t be too heavily on timing. And, of course, we have no idea what the results will be.

I don’t know, or even really have a guess, about whether or not MYMD-1 will end up being a revolutionary blockbuster drug, or eventually get approved for use against a major disease and generate a lot of revenue, but the basic assumption with any early-stage drug should be that the odds are pretty low… and it’s very likely to be at least a few years before we find out. Big diseases require lots of testing against large groups of people before the FDA grants approvals, and so far only a few dozen people have been given MYMD-1. So far so good, on the safety front, but it’s early days… the best thing I can say is that there hasn’t been any really bad news yet.

There is essentially no institutional ownership here, as is common for microcaps, and small-time investors like you and I are likely to make these shares bounce around quite a bit as they ride the tides of sentiment.

What we’ll very likely continue to have for the next year or two is the push-pull between early clinical trial results that cause daydreams about future riches (or panic about failure), and equity sales that make people grouchy about dilution… and if you throw in a newsletter pitching the stock every now and then, perhaps some extra volatility on top of that. The combination of big market and small market cap often attract biotech investors to “story” stocks like this, so one never knows what might happen.

I wish them well, and I would be delighted to see better treatments for all those diseases… and every year, I get more interested in drugs that might make me less frail as I (hopefully) get much older… but I’ll just watch from the sidelines for now. The one thing I know for sure, when it comes to biotech stocks, is that there are a lot of specialist investors out there who know a LOT more than I do about the science and the diseases being addressed… and they get it wrong a lot, too, so I’ll stay out of their lane.

I’m sure there are plenty of Gumshoe readers who know far more than I do about the state of rheumatoid arthritis research, and may have an informed guess as to whether MYMD-1 has a real chance of making progress against that disease… and the story has certainly made the rounds for a while now, so maybe some of our readers actually own the stock. If you’ve got some input on the hopes and dreams, or want to throw some water on that “hot” story, well feel free to chime in — just use the friendly little comment box below.