Replies to post #484073 on Anavex Life Sciences Corp (AVXL)

[BakedLangostino]

Operating costs will be way above $2 billion.

Figure Anavex gets .25 per pill sold, excluding its operating costs. I’d expect Anavex to net around .10-.20 after all costs are tallied. Remember that Anavex is going to also spend hundreds of millions or more trying to advance A371, Rett, PDD, and possibly a preventative trial, too.

[baltimorebullet]

I had read a few years back that in the UK if you got cataracts they would only fix one eye as money was tight and you could still function.
If I could get word to all the bean counters in Europe we'd be approved yesterday.

[dia76ca]

With sales in UK, Canada , Australia and Asia following soon after Europe...and US (whenever) the worldwide share price would be impressive!

[falconer66a]

Once Again, Doing an AVXL Spreadsheet

With 80 million shares that is ~$220 per share.
With a conservative P/E of 15/1
that gives us a share price of ~$3,300

Well, an AVXL share price of $3,300 will make most who have any sort of AVXL position quite wealthy. When I multiply my number of shares times $3,300 I’m wealthy by many millions of dollars.

Could the AVXL share price actually reach $3,300? For private sport, run and manipulate the numbers; which will include the following.

When I do my anticipated eventual share prices, I start with an eventual AVXL share count of 100 million. Right now, Anavex has about 85.06 million shares being owned and traded. My 100 million datum presumes that about another 15 million new shares will be sold by the company before it has any appreciable revenues from drug sales. For calculation, 100 million is convenient, a digit 1 followed by eight zeros.

Then, probably the most significant calculation, will be to estimate, globally, the number of patients that will be treated with Anavex drugs each year. You can do a web search for such info. On the web, ask “How many people have _____?” Make the query for each disease Anavex is targeting, which (I believe) would be the following:

1. Alzheimer’s disease.
2. Parkinson’s disease.
3. Schizophrenia.
4. Rett Syndrome.
5. Cardiac Arrythymias.
6. Amyotrophic Lateral Sclerosis.
7. Anti-aging Prophylaxis
(In the future, perhaps others.)

Put the projected patient numbers (Anavex drug sales clients) on separate, disease-labeled lines on a spreadsheet.

Then — the biggest but most significant projection — presume that an Anavex drug becomes the SOC, the Standard of Care drug for each disease or condition. Presume, say, that Anavex drugs will be used to treat 66% of all with each disease or condition.

Then, on the next spreadsheet line, estimate each patient’s daily cost for the Anavex drug treating his or her disease. In my calculations, I make Anavex drugs really cheap; $5 per day; an annual cost of $1825 a year.

In the next line, in the cells below, multiply the estimated annual drug cost of the disease times the projected number of treated patients. For example, if Alzheimer’s disease will have blarcamesine as the global standard of care drug, given to everyone diagnosed with the disease, if there will be, globally, 25 million Alzheimer’s patients being treated with blarcamesine, Anavex’s annual revenues would be 25,000,000 x $1825; which is from these global Alzheimer’s estimations $45,625,000,000; 45.625 billion dollars of corporate revenues each year.

Make those estimations for all of the listed diseases and conditions.

Then, estimate how much of all of that will drop down as after-costs corporate profits, which will be distributed out to shareholders each year. Divide that giant earnings number by the number of outstanding shares, 100 million.

Then, two important estimations or conjectures. With the calculated total annual dividend number, estimate the price-to-earnings ratio and the estimated the share price.

Finally, multiply the size of your AVXL holding by the estimated share price, to show the value of your AVXL position, and multiply your AVXL position by the estimated share price, to see the conjectured annual dividends amount you will receive.

Lots and lots of zeros in these calculations. Big numbers. Big diseases, for which Anavex may well provide the SOC, preferred therapies. As I’ve contended for many years, if Anavex gets to treat only a few of the seven listed diseases or conditions, it will be a major pharmaceutical. I think at least three of the listed disease targets are lock-ons. But, a reasonably good chance Anavex drugs will be able to treat most or all of the seven. And, there may well be more, in the future.

[xodcode]

Cut patient count or cost per patient in half still gives us $1,650 a share.

Let's estimate profitability as follows:

Year 1 - $80 million, $1.00 eps x 15 multiple = $15.00
Year 2 - $160 million, $2.00 eps x 20 multiple = $40.00
Year 3 - $400 million, $5.00 eps x 25 multiple = $125.00
Year 4 - $ 1,000 million, $12.50 eps x 25 multiple = $312.50
Year 5 - $ 2,000 million, $25.00 eps x 25 multiple = $625.00

PMV (Present Market Value) with a discount rate of 5% is much, much higher than the current $7.90!