Let’s set the mood with a song. Go to you tube and put this in after the back slash: watch?v=Hz64hWng2vM
Tiring, isn’t it? Mid-week, things didn’t seem so bad. But then, after a two-day green “streak” Tuesday and Wednesday, we got smacked again. Why, oh why? Oh yeah, options expiration.
Let’s see the numbers: AVNR lost a penny on the week to close at $1.80 which is 0.35%. The NASDAQ was also red, losing 0.1%. YTD, the stock is still green by 7.0%. Last February 16, the stock closed at $3.00. So the YOY comparison is now negative by 6.67%. This is again an improvement over last week, when it was .
Here’s how the week went day by day:
Monday: NAS had a red day, but recovered to lose only 1.87 points (0.06%) to close at 3192. AVNR spent the day in the red but recovered to a loss of 3 cents or 1.07% to close at $2.78. There was an 800k trade early in the day, which explains part of why the volume was 2.418 million.
Tuesday: The NAS had a see-saw day, closing with a narrow loss of 5.51 points, or 0.17%. ANVR started red, dipping as low as $2.74, but then recovered to gain 5.5 cents to close at $2.835 (1.98%). Volume was 1.524 million.
Weds: The NAS had a green day, ending up 10.39 points or 0.33%. AVNR was green most all day, staying in a narrow range to gain 3.5 cents to $2.87, or 1.23%. Volume was disappointing at 899k.
Thurs: The NAS started red but turned green, gaining 1.78 points or 0.06%. AVNR was green for a moment, only to drift down to a loss of 4 cents (1.39%) to $2.83. Volume was only 721k.
Friday: NAS was up and down, closing down 6.63 points (0.21%). AVNR, for its part, celebrated options expiration in the customary fashion, losing 4 cents, or 1.41% to close at $2.80. The move took us into the red for the week. Only fitting. Volume was 1.283M.
Options. Does anyone know how many were in play for February, at their peak? Yesterday E-Trade showed a number only in the 120 range—was it higher before? The reason I ask, I shudder to say, is that there are 8,040 open calls with a strike price of $3.00 for March. This looks like a high number, but I’m just not that familiar with options. Anyone who is, please chime in. If it means what I think it means (another month with a lid in place at $3.00), the only good news is that after next month, there are no more options until June.
Time for a musical break. Love this from the sound track of “O Brother, Where Art Thou”:
I do feel like a man of constant sorrow around here sometimes. But that’s just because we don’t get to see what’s going on. We thought we had a decent litmus for the company’s performance with the TRx numbers, but with the Affordable Care Act imposing duration restrictions on prescriptions in LTC facilities, the new numbers have yet to be deciphered. It would be really good if the IR department at Avanir could give us some guidance, once they’ve figured it out.
But you know, I’m not worried. Let me talk movies for a second. The industry was not always like it is today, where a movie either or makes it or breaks it within 2-3 weeks, and is off to video within a couple of months. No, back in the analog days, movies stayed in theatres for weeks or months, depending on whether people went to see them. I remember in San Francisco, “The Gods Must Be Crazy” ran at the Vogue for over a year.
Star Wars is what I’m thinking of, though. This was a little movie out of CA. Had a good story, but it was filmed on a tiny budget. Harrison Ford was not yet famous. The only person close to famous in the cast was Carrie Fisher, who was famous mainly for her parents (Debbie Reynolds and Eddie Fisher). But people loved it. They told their friends, who also attended, and then told their friends. It took several months, but eventually the movie gained momentum, and became the foundation for the franchise we know today. This is my thought: if Star Wars had come out today, it might not have succeeded.
I think Nuedexta is like Star Wars. And fortunately, with a medication, word of mouth still works like it did in the old movie industry.
Some here have spoken of a “failed launch”, taking about how we only have scripts in the thousands each week. The implied comparison is for a drug like Viagra, which hit the ground running. But there was a reason for that. I’m writing to an educated group, so I don’t have to go into why Viagra basically sold itself.
Nuedexta for PBA is not such an easy sell. Think about it: PBA makes a person laugh or cry at inappropriate times. This must be terribly embarrassing. The victims of PBA aren’t out looking for a solution—they’re hiding from society. Unfortunately, due to the nature of the malady their drug is currently approved for, Avanir’s sales department has to go out and FIND the people who will benefit from this medication. Talk about a high bar! And some here are lamenting the fact that off-label sales must not be catching on? Are you kidding? ALL that Avanir can talk about out loud is PBA right now. How can we expect there to be a rush of off label scripts for pain, speech and swallowing, etc?
But I think the company is doing very well. They’ve tweaked and re-worked their strategy to make the most of their resources, and to increase the likelihood of FINDING the patients who will benefit from Nuedexta, within the limits of the drug’s current FDA approval. In the meantime, they’re testing on various fronts. Parkinson’s. Alzheimer’s. TBI patients. Stroke patients. This drug can and will help significant percentages of people in all of these afflicted groups. And thanks to the income the sales folks are bringing in—which IS increasing week by week, month by month, and quarter by quarter—they’re going to be able to do it without further significant financing. I'm encouraged by the number of hits the web site referenced by the commercial is getting. This will translate into prescriptions.
In closing, I turn to one of the legends of rock, Mr. Wilson Pickett, who will tell us what it will be like for us humble investors, when the public really catches on to this medication. I know it’s totally lip-synched, but he puts on quite a performance. Seems kind of like Viagra, doesn’t it?
Yup, no mention of what the stock is really doing at all. OK, the resistance is at $2.89 and support is down at $2.57 as I mentioned over a week ago. That is it. So it is pretty easy to predict that the stock is going to go down. Also, the stock did not improve over last Friday's close a week ago as I so kindly shared here as well. It has gone down Wk/wk/wk/wk as I have shared. I have shared some pretty good info as I hate losing money. I am not like a long or Sarge who accepts losing money.
Now the stock will go down next week and close worse off than this week. It is important to make money on the calls that you sell and the puts that you buy. The institutions have this right where they want it. Each tip around they get more shares from retail longs who give up. They make more and more money. Longs will not make money for much longer than they have already been here in my opinion. If you do not trade around support and resistance you will lose money. No reason moping around about it. The numbers are right there in front of you.
The script numbers are horrid. Now they cut the size of the perscription. I say so what the stock sucked anyways. About the script cuts, affordable health care BS, who did you vote for? I am sorry your life sucks today but you voted for the idiots so you get what you deserve. Being STUPID is supposed to be painfull.
So next week the stock should fail to support or close to it. The Euro stuff is overrated and priced in. It will be a great time to sell and if you take short positions then take out a wopper because the rip and fall could be even better than when this company got FDA approval for N. That was the beginning of a solid fail of the stock.
I also think that dilution will kick in after the next complete quarter. Not a lot but it could be enough to take .30 off the share price. It will be fun to time this and then watch the pumpers make another excuse for why it is good. Their hopes this week was that the company did not get bought out. How stupid is that? Well, that is the pumper metality. They have made no money on this stock, lose money monthly and they do not want a buy out. Probably the only way to make a profit and they do not want it.
Pumpers are not your friend. They do not want a buyout because they would not get paid for their posts here any more. They do not own any shares and so have nothing to gain. They have no interest but their paycheck.
So, get ready for next week. You could sell some on any strength and save some .30-.40 a share. Then maybe get some more stock at $2.57. Pull the charts, pull resistance and support, it is right in front of you if you have any ability at all to do DD.
Sarge's Saturday report is for feebleminded individuals who already forgot that AVNR had ANOTHER horrid week in the face of a market that will not stop rising. Noting else in that Saturday report.
I thought about buying some Avanir on Tuesday as a trade in the hope of some anticipatory buying before the European CHMP decision in mid March like Tradestocks has been assuring us would be happening two or three months ago. But with my luck with this stock it would go down further in anticipation of a narrow label.
So I'll probably just sit with the small amount of stock I already have.
sarg, your reference to the movies is sort of timely. The wife and I just got back from a screening of "Side Effects" with Jude Law & Catherine Zeta-Jones. Jude played a psychiatrist who had a seemingly depressed patient. He talked with her about a group of drugs called SSRIs and prescribed one for her. Turned out it had side effects, so at her suggestion, he prescribed another - with bad consequences. Some twists in the flick, so I won't go into detail, but it made me think of some of the discussion on this board.
Perhaps one of these Saturdays we can discuss the meteoric rise in AVNRs pps.
"And some here are lamenting the fact that off-label sales must not be catching on? Are you kidding? ALL that Avanir can talk about out loud is PBA right now. How can we expect there to be a rush of off label scripts for pain, speech and swallowing, etc?"
We would have EXPECTED off-label pain use by now because there is significant data suggesting that dex/quin, in sufficient dosage is effective for pain and pain is a very significant issue for patients and physicians and the limiting of the use of opiates is another very significant issue for patients and physicians. You underestimate the knowledge of study data that physicians have in their specialty and communication amongst physicians, both from physician thought leaders down to other physicians and laterally from physician to physician. Specialists don't need Avanir to be telling them about off-label use for pain.
"But I think the company is doing very well. They’ve tweaked and re-worked their strategy to make the most of their resources, and to increase the likelihood of FINDING the patients who will benefit from Nuedexta, within the limits of the drug’s current FDA approval."
"Finding" patients with PBA should not be as hard as the comp;any wants investors to believe it is.
Not all patients are embarrassed to talk about PBA. Those that are, are less likely to be embarrassed to speak with a nurse or physician about it than they are to speak with friends about it because patients would view nurses and physicians as more knowledgeable and understanding about such problems than non-medical people and there is confidentiality, trust and supportiveness in doctor-patient relationships.
Furthermore, if PBA is significant enough and burdensome enough to warrant treatment with dex/quin, it would probably be observed by physician office staff. In the STAR trial, the patients began with almost 6 episodes per day, on the average. That is during the 16 waking hours of the day or almost one episode every two and a half hours. This interval is not much longer than the average office visit from the time the patient enters the waiting room to the time the patient leaves the office. So probably 1 episodes would occur every 2 visits on the office premises. Not only could it be observed by office staff, but these patients have significant others/caretakers who would have noticed a lot of inappropriate crying or laughing and can report it.
Moreover, the experts at the Avanir-sponsored symposium told us that the vast majority of PBA patients live in long term care facilities where they are attended ALL THE TIME.
" In the meantime, they’re testing on various fronts. Parkinson’s. Alzheimer’s. TBI patients. Stroke patients. This drug can and will help significant percentages of people in all of these afflicted groups. "
There isn't enough data to say that.
Good Saturday to you, Ray,
I think we're both saying the same thing, but reaching different conclusions. I'm saying we have all these tools for communication, so the drug will succeed, and you're saying we have all these tools for communication, so why haven't we succeeded yet?
One reason is that neurologists, from what I've heard, are not a bunch that is eager to try new treatment regimens. The basic mentality, if I can over-generalize, is that they'll let some other doc make a mistake rather than go out on a limb. If, however, there is a good track record, they'll then take a chance. Kind of a Catch-22, if you ask me.
And the data, my companion in dialogue, is growing. Keep smiling. Your long shares will appreciate. Just a matter of time.
Hello Sarge and Rzr, my friends.
Just a quick snippet. Sorry can’t stop must dash things are ok ;-)
Yahho Finance Videos
Cramer: Why Stocks Sometimes Won't Rally
By Lee Brodie | CNBC Yesterday
Just a little light entertainment. Is that a case of the kettle calling the pot black.
Extracts from the CNBS video
2. Hedge funds also present a wild card in the equation.
If a stock you hold isn't rallying but you think it should, you may want to do a little research on whether there's any forced selling happening in the market.
"Stocks can easily get slammed just because hedge funds that own them are in trouble and desperately need to sell everything in order to raise cash," Cramer said. That's called forced selling and usually has to do with an unrelated bad bet.
The sheer volume of selling that hedge funds generate can prevent an otherwise solid stock from making gains.
PS Thanks for the weekly round up catch up with you soon as….
It's always a pleasure to hear from you, Razor man! I'll even overlook Mr. Cramer's role in the history of this stock (remember when he spoke glowingly of EB, mispronouncing the name of the company all the while?). You have a great weekend, too. Hope it thaws out a bit for you!