Anavex Life Sciences Corp (AVXL)

[cadno]

I think some of the people here estimating massive potential returns based on huge revenues at some point in the future, based on the many possible applications of the drug apart from the big one of Alzheimer's, are forgetting a key possibility. If 2-73 does show good results and gets near or just post-approval, it would be very unsurprising if a larger pharma bought AVXL out.

AVXL is a tiny company, and dealing with rollout of a massive, blockbuster drug could be difficult, even for one that is administered simply. And if 2-73 were approved, the stock price would likely be at least $30. A buyout would add probably 30% value to that. Do you think the Board would turn down such an offer? They want to cash in, and get out from the risk. What does it matter that the company could be worth many billions if they didn't sell? They'll all, including Missling, be stupendously rich after a buyout.

The same thing happened with another pharma I own today, KITE. Though I was invested, I am not happy at the 30% return today, because that's the end of the road. I'm not going to invest in Gilead, because it's a $100 billion cap company. I understand why the Board did it. Many people would have revolted if they didn't sell for a 30% premium. But I am not happy, as I wanted to ride KITE for years in the future, and, I think, to much larger values than $180/share.

The same could very easily happen to AVXL if 2-73 is approved or looks to be approved in the future. It's probably more likely than not. Annoying, but true.