Prior to Avanir Pharmaceuticals’ (NASDAQ:AVNR) development of Nuedexta, odds are good most investors had never even heard of pseudobulbar affect (PBA). They sure got to know what it was in 2010, though, given the hysteria behind the drug. To the company’s credit, the stock did soar after the Oct. 29, 2010, approval. Sadly, though, the stock spent the rest of the next four months falling.
Traders who were in the stock before the announcement literally doubled their money on that surge. Traders who were expecting the stock to continue rallying after the drug was approved were sorely disappointed.