Hi Smokeandfire,Your question is a very relavant one and I...

Hi Smokeandfire,

Your question is a very relavant one and I certainly do not profess to be able to answer it! I ask myself the same question, as I also wonder what the price is likely to fall back to in the event of a rejection. Having some knowledge of downside risk is important. Nevertheless, most brokerages that cover the stock - if there are others besides HTM Wilson - I don't believe could answer this question either with any accuracy. I think it would depend on the reason for rejection. If there were some simple additional biostatisctical analyses that needed to be run by the statistician before the pivotal trial data were resubmitted again, then the SP drop should not be deep and sustained. Remember, FDA actually want to be able to approve the drug. They will try to approve it if at all possible. However, if there was a fatal flaw in the data then CXS may have to start all over again with another pivotal trial. This scenario is highly unlikely, but this scenario would probably cause all but the most resilient investors to walk away for some time! Like what happened to Progen. A lot of brokerages - EG Capital being one example - talk themselves into believing that they know the downside and upside risks. But really it is a completely speculative guess...and I normally estimate the downside at the worst case, which is $0.00.