CytRx Corporation (NASDAQ:CYTR) Is A Strong Buy

CytRx Corporation (NASDAQ:CYTR) ran up just shy of 20% on Friday, bringing its weekly gain last week to more than 40%. The run comes subsequent to the company's announcing that it is set to present phase 3 data from its lead development program at the upcoming 2017 American Society of Clinical Oncology (ASCO) Annual Meeting and a subsequent spate of media outlets picking up on the abstract for the presentation of being one of the most eagerly anticipated in the event.Back in October 2016, we highlighted this company as being a potential contrarian play. At the time, CytRx was the subject of some pretty negative press surrounding a then mid-stage data release, and as part of this coverage, we argued that the market's interpretation of the data was flawed and that – over time – this interpretation would shift to reflect reality.In turn, we argued that CytRx would revalue to the upside on the back of this shift.At the time, the company was trading for around $0.42 a piece. Late April, this had risen to $0.85. Current price is a little off these highs, with the company closing out last week at $0.73. That's a 73% gain between us first highlighting CytRx and current pricing, but we think there's still plenty of run room left.The thing is, markets are currently pricing this company as if it doesn’t have a chance of getting its lead development asset to market. At the end of last year, while we were of the opinion that markets were misinterpreting the data, there was a degree of credence to the suggestion that getting the asset in question to market, while not impossible, might be difficult and costly.With things as they stand, however, that's no longer the case.As announced back in April, the FDA has green lighted a rolling submission for the drug that will take the same form as the applications for a number of other successful oncology drugs, including Abraxane, Doxil and Onivyde. Basically, the company can collect all of its data together, including the phase 3 that's set for presentation at the upcoming ASCO Meeting, and kick off a rolling submission as early as November this year. With this sort of submission, the agency reviews each section as it comes in, meaning the turnaround time (from data collation to approval) is far shorter than normal.If the rolling NDA submission is successful, and the FDA gives the drug a green light for commercialization in the US, we are looking at a potential 2018 rollout.Analysts put the market for this one at between $250 million and $350 million peak sales. To put the argument for an upside revaluation another way, then, we've got a late stage development biotech with an asset that has the potential to generate three times its entire market capitalization in annual revenues, and that will start the submission of the application for this asset before the close of this year.We think that, over the coming months, markets will become wise to the disparity between actual and potential value of CytRx, and that the company will appreciate as a result. Further, that any opportunity for management to push this asset and its supportive data to the medical community, of which an ASCO presentation is one, has the potential to jumpstart this valuation shift.Sure, cash is going to be necessary to fund a commercial rollout, and sure, there are at least twelve months of operating expenses that need covering before the drug even has a chance of bringing in revenues for CytRx. For an investor willing to shoulder a bit of dilution across this period, however, there's also the potential for considerable reward on an upside revaluation.We will be updating our subscribers as soon as we know more. For the latest updates on CYTR, sign up below!Disclosure: We have no position in CYTR and have not been compensated for this article.