Bullish Case: Strong sales trajectory for Leqembi and new drug approvals suggest positive momentum for BIIB, potentially leading to a recovery in stock prices around upcoming earnings and FDA updates.

Bearish Case: Heightened competition from generics and regulatory scrutiny, especially concerning safety warnings related to Alzheimer’s treatments, may lead to significant declines in BIIB's stock value and investor confidence.

Potential Outcomes:

1. Regulatory approval for new drugs (60%).

2. Serious safety concerns arise (30%).

3. Strong market uptake of Leqembi (25%).

4. Continued revenue decline due to generics (40%).

Trading Oracle: Implement a bearish credit spread using the $180C/$187.5C options, given a high probability of profit (83%). This approach leverages short-term volatility with a favorable risk-reward. Alternatively, take a bullish stance by purchasing $172.5P and selling $160P as implied volatility is elevated, aiming for significant returns with a 77% market edge.

November 03, 2024