Avid Bioservices Inc (CDMO)

[sulaco]

MD, if Bavi is the cornerstone molecule GILD is looking for

then $20 billion may indeed be the initial cash offer, but no way Garnick, SK, ES et. al. will settle for that. They want a piece of the action in the future. How does that happen then? GILD offers PPHM cash AND stock.

What if GILD said, "OK, we offer $20 Billion for US rights AND 1 share GILD for 5 shares PPHM to your stockholders."

This is a more plausible way to get to the high numbers bandied about from time to time on the Board.

****EXAMPLE: Joe Six-Pack IHUB Member has been averaging down for the past 2 years and now has 65,000 shares accumulated.

CEO John Martin of GILD gets aggressive and makes the above offer.

How does Joe Six-Pack do? Well, he does quite well with the initial offer, but he'll do even better if he sticks with GILD.

The $20 billion cash gives Joe about $20B/300M shares (shares outstanding will increase in the future, hey, that's Biotech, out of the kitchen if you can't take it), which = $66/share, which gives Joe $4.3M for his Biblical patience. Sounds fine, but ah, we're just beginning.

Joe's 65K shares will entitle him to 65K/5 = 13,000 GILD shares, which X closing price today $102/share gives him another 1.32M

Ah, but do we really expect GILD to stand still at $102? Think not. With their new cornerstone molecule, Martin snaps up the best PD-1s, PD-L1s and other T-cell modulators at bargain prices for his combos. Everyone suddenly wants to do business with GILD, and Martin knows that with a grin on his face.

So GILD stock heads north as they lock up SOC in MULTIPLE solid cancer indications (see Sunstar's many laundry list posts as to how many cancers Bavi can combo against).

3 years from now, GILD is $345/share (not at all unreasonable, with GILD/Martin's killer instincts).

How's Joe Six-Pack doing now? Well, he's got $4.3M + $1.3M + the appreciation of his GILD shares which is $3.18 M, for a grand total of 8.78M for his time and effort.

Yeah, yeah, haha, wotta riot, the hell you say... keep thinking that...(smirk)

Regards,

Joe