Anavex Life Sciences Corp (AVXL)

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An AVXL Future Values Spreadsheet

These ultimate smart investors [those who have strongly-held AVXL positions, who don’t trade] will leave a fortune to their heirs.

For an instant, I pondered this statement, as it matched my future projections of what a holding of AVXL might be worth, in both value and dividend distributions five or ten years from now.

As it happened, just a few days ago I created a spreadsheet that would calculate potential values if and when blarcamesine gains FDA approval.

My calculations presumed several things:

a) Results from the ongoing big Alzheimer’s clinical trial will be very positive; blarcamesine will be proven to stop or even reverse Alzheimer’s symptoms, while doing this with utter safety (no disqualifying side effects).

b) Consequently, the FDA will approve clinical use of blarcamesine for Alzheimer’s. It will immediately become the recognized and mandated standard of care (SOC) for the disease.

c) The millions of Americans with Alzheimer’s will be treated with blarcamesine, thereby providing very strong annual revenue streams to Anavex Life Sciences Corp.

d) Additionally, it is discovered that pre-symptomatic administration of blarcamesine proves the drug to be prophylactic; hence even greater sales ensue.

A number of variables need to be taken into account, producing various ranges of metric data:

a) Numbers of blarcamesine patients cannot be narrowly known.

b) Prices at which Anavex will sell the drug cannot be narrowly known.

c) Durations of blarcamesine treatments cannot be narrowly known.

So, a multitude of interacting variables, not determined in a straight-line manner. Of course, that’s where artful use of a spreadsheet comes in. In my “Potential AVXL Metrics” spreadsheet, here were the cells in my A and B columns:

A1 – Users [number of Alzheimer’s patients being treated with blarcamesine], in B1
A2 – $$/week’s cost [cost charged for a week’s treatment of blarcamesine], in B2
A3 – $$/yr cost [yearly cost of treatment]— multiplies B1 x B2, in B3
A4 – Corp Revs [annual revenues from blarcamesine sales] B1 x B3, in B4
A5 – Corporate Shares [outstanding shares of AVXL, presumed to be 100,000,000], in B5
A6 – Revs/Share [B4/B5], in B6
A7 – My Shares [number of AXL shares I own], in B7
A8 – My Share’s Revenues [proportional dollars of corp revenues apportioned to my shares]
B6 x B7, in B8
A9 – Percent Revs Dropdown Out as Dividends [assigned or assumed percent of annual revenues to be distributed as dividends], in B9
A10 – My Position Value [$ value of my AVXL position], estimated P/E ratio x B9, in B10

Then with those two columns A and B, add new columns with different user and cost data (lines 1, 2, 3) for other possibilities. Also, vary the dividend % and P/E ratio in lines 9 and 10.

VERY IMPORTANT. When you do this, when you’ve punched in your own AVXL spreadsheet, DO NOT post your numbers here; just very generalized statements, along with statements that if blarcamesine fails its clinical trials, all dollars used to take an AVXL position will be lost. Don’t let the gigantic numbers feed any hopes of great financial gains. Everything depends on the variables, cells B1, B2, and B3, which themselves are dependent upon eventual FDA approval.

I’ll follow my own advice. For me, with my several thousand AVXLs, if all of the metrics are at the high end, my heirs and philanthropies will be richly rewarded at my passing. But if blarcamesine gains FDA approval, but all of the other metrics are at the lowest possible levels, I will live the rest of my years in reasonable comfort. Good enough.

If the clinical trials fail, life will go on. Over five years I’ve invested only discretionary, can-be-lost funds from my budget.

My best wishes to all; to AVXL holders, and more importantly, to the millions whose health will be improved by the Anavex drugs.