$AYTU DD by u/mcellr

This DD was originally posted on the subreddit r/pennystocks

Is AYTU ready to run? Many are saying yes. And many insiders acquired shares on June 8th at a share price of $1.45. So, it seems that they believe that the stock is worth at least that much. (Current share price is $1.48). Some are saying a share price of $10 is possible given what they have.

So, why is AYTU ready now? AYTU has: covid testingpotential covid treatment (with new news), and a host of current meds already generating revenue. And the great new news last week mostly has flown under the radar. Some biotech stocks are all pipeline (and nothing generating revenue), but AYTU has meds already generating revenue, and we’ll get to that, but first:

Which bro? Disbrow.

The Disbrow twin brothers (Josh (CEO of AYTU) and Jarrett (COO of AYTU)) previously ran another successful pharma company (“Within roughly five years, Arbor grew from an idea on a sheet of paper to about $250 million in sales when Josh left” “and the Disbrows sold their stake to KKR in a private transaction that valued the company at just over one billion dollars, or four times revenue”). And prior to that they worked at GlaxoSmithKline.

And their father (Cliff Disbrow) ran US technical operations at GlaxoSmithKline for many years.

Cool. All three worked at Glaxo.

Any other notable former GlaxoSmithKline employees? Yes. The head of Operation Warp Speed is former GlaxoSmithKline vaccine head Moncef Slaoui.

Double cool. So, 2 sons and dad in pharma, and a possible nice connection.

But are there any other Disbrows? Yes. Dr. Gary Disbrow is the current Director of BARDA (which has been handing out billions of dollars to biotech companies for covid). Is Gary Disbrow related to the Josh and Jarrett? I’m not sure. I scoured the internet, and I found only one person claiming that they are related. There is reason to believe that they might be related because: how many Disbrows are in the US? Only 2,314. (Bonus: The name Disbrow is English in origin and means fortress or “stronghold”. AYTU seems in fact to be a strong hold). Anyway, the likelihood of 4 Disbrows in biotech who know each other seems high.

So, if they potentially have connections to the head of BARDA and the head of Operation Warp Speed, then they better be pretty quiet until they have great data. No one in business wants to be accused of impropriety. Especially in the pharma sector. So, they have in fact been pretty quiet. And their track record with Glaxo, with their previous company, and now in the lead at AYTU would point to them knowing what they are doing and being responsible.

It’d be even better if they had another brother who was like an expert in the law and ethics though. Guess what, they do. Their brother (Jason) is a judge in North Carolina. Pretty well-accomplished family.

Alright, they have the pedigree. What about the products?

Healight- sometimes the simplest ideas save many, many lives. We know that UV light kills bacteria and destroys viruses. In fact, I have a UV system on my water supply at home.

What if we could take UV light inside our body? Sound familiar? It should because it seems likely that Trump was briefed about Healight, then talked about it in a press conference (while also mentioning disinfectants). Those comments got a lot of traction with reporters, but most didn’t realize that Healight was a real thing. Then, when people saw Healight on youtube and twitter, those videos got banned like they were propaganda for a moment. The company got stuck in the middle of a war of words and ideas. Bummer. Anyway, sometimes politics brings attention to a product, but sometimes that attention isn’t always accurate.

So, what is accurate? Healight is a UV light being work on at Cedars-Sinai that could be put down the tube of every patient intubated in an ICU since it kills/destroys so many kinds of viruses and bacteria (including covid it seems). What other kinds of pathogens?

Hot off the presses 5 days ago:

https://pubmed.ncbi.nlm.nih.gov/32673355/

“Controlled UVA exposure yielded significant reductions in Pseudomonas aeruginosa, Klebsiella pneumoniae, Escherichia coli, Enterococcus faecalis, Clostridioides difficile, Streptococcus pyogenes, Staphylococcus epidermidis, Proteus mirabilis and Candida albicans.” “UVA-treated coronavirus-229E-transfected tracheal cells exhibited significant coronavirus spike protein reduction, increased mitochondrial antiviral-signaling protein and decreased coronavirus-229E-induced cell death.” “These findings suggest that, under specific conditions, UVA reduces various pathogens including coronavirus-229E, and may provide a safe and effective treatment for infectious diseases of internal viscera.”

Translation- it led to reductions in Pseudomonas, Klebsiella, E. Coli, C. Diff, Strep Pyogenes, Candida, and corona virus.

And seems to be safe to use, but requires clinical studies.

It would be nice if there were some kind of project that could speed things up and warp them ahead with some funding. Hmmm…..

So, there is some talk that BARDA (and maybe CEPI (the Coalition for Epidemic Preparedness Innovations)) will throw more money at companies working on treatments (and not just vaccines).

“Vaccines are the permanent hope for controlling this outbreak, but even with success, some people may not respond to vaccines and some may not get vaccinated, so we are always going to need therapeutics,” said Janet Woodcock, who is leading the therapeutics effort under Operation Warp Speed and is a senior adviser to the Food and Drug Administration commissioner.

So, how much money is available in Operation Warp Speed?

$10 BILLION DOLLARS.

So, Healight could treat covid, other viruses, and bacterial infections. That’s a big deal not just for the patient, but to potentially reduce the spread of infection to other patients and staff.

Afterall, researchers are now suggesting that some people who get covid may have permanent lung damage, so we need treatments. https://www.sciencenews.org/article/coronavirus-covid-19-some-patients-may-suffer-lasting-lung-damage

And “Viruses replicate exponentially. A single infected cell can produce hundreds, if not thousands, of copies of the particle. This means that for some viruses, even a tiny dose of virus is enough to cause an infection. For example, for half the population, it takes just 18 particles of norovirus to cause an infection.” So, reducing the number of viruses can save lives.

Okay, Healight sounds cool. What else do they have?

Covid testing- “6/1 Press Release- Additionally, more than 1.4 million COVID-19 IgG/IgM rapid tests have been delivered to the Company’s warehouse in San Diego and are available for distribution.” “Emergency Use Authorization of the COVID-19 IgG/IgM Rapid Test Cassette was granted by the FDA on May 29, 2020.”

Testing right now is a huge sector with a lot of room for many, many companies both in the US and abroad.

Do they have anything else?

Products currently generating revenue-

Their primary care portfolio includes:

  1. Natesto- “the only FDA-approved nasal formulation of testosterone for men with hypogonadism (low testosterone, or “Low T”)”

  2. ZolpiMist- “the only FDA-approved oral spray prescription sleep aid”. (This is Zolpidem (you probably know it by one of its other trade names: Ambien))

  3. Tuzistra XR- the only FDA-approved 12-hour codeine-based antitussive syrup (cough medicine).

The pediatric portfolio includes-

  1. AcipHex Sprinkle- a proton pump inhibitor (helps with GERD)

  2. Cefaclor- an antibiotic

  3. Karbinal ER- an antihistamine suspension indicated to treat numerous allergic conditions

  4. Poly-Vi-Flor and Tri-Vi-Flor- two complementary prescription fluoride-based supplements for infants and children with fluoride deficiency.

Natesto is a Testosterone medicine for men with low levels, so you’re going to see some sophomoric jokes online, but that sector is reportedly over $1 Billion dollar market, so that’s no laughing matter.

So, if they have great meds and 2 covid plays, then why is the AYTU share price still so low?

  1. They need solid data to report (and they got it last week)

  2. The share price might be artificially low right now. How and why?

Let’s look at what happened at Vaxart (VXRT). Part of the Vaxart story was that Armistice Capital reportedly needed to sell a lot of shares in order to be eligible to exercise warrants, so the sale of those shares kept share price down for a while. Armistice sold over 1 million shares of VXRT in early June, and the share price rocketed a few weeks later.

https://yahoo.brand.edgar-online.com/displayfilinginfo.aspx?FilingID=14208688-1687-24883&type=sect&TabIndex=2&companyid=945&ppu=%252fdefault.aspx%253fcik%253d72444

Why should this matter? Steven Boyd from Armistice Capital is on the Board of Directors at Vaxart.

And he is also on the Board at AYTU. Hmmm…

The Russell Index- Of note, both VXRT and AYTU were very recently added to the Russell Index, so now more funds are eligible to purchase shares. And that’s a very good thing.

Are people watching this stock? Over 47,000 watchers on stocktwits compared to 42,000 for VXRT. Lots of eyes watching. Labcorp has only 1,800 watchers. 26,000 watchers for OPK (another testing company). There was a time when OPK and AYTU were about the same share price. OPK has skyrocketed in recent weeks to $5.94.

Here is AYTU’s corporate presentation from May:

https://s3.amazonaws.com/cdn.irdirect.net/PIR/1081/4445/Aytu%20Corporate%20Presentation%20-%20May%202020.pdf

Here are shares acquired by insiders:

https://sec.report/Document/0001654954-20-006585/

https://sec.report/Document/0001654954-20-006584/

https://sec.report/Document/0001654954-20-006583/

https://sec.report/Document/0001654954-20-006581/

https://sec.report/Document/0001654954-20-006576/

TLDR: Which bro? Disbrow. AYTU primed for launch. Possible target of $10. Please do your own DD to see if this is worthy of your consideration.

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$AYTU DD by u/mcellr
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