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"just hypothetically wouldn't the IV's be so jacked up that you'd hardly make any money?"

Well, not the intrinsic value.....I think you mean the time value. IV is simply the difference between the stock price and strike price. The latter amount is something you select.

Every expected payoff will be unique to the circumstances. I would just suggest evaluating the option approach in lieu of leaving oneself open to the potential losses in shorting a biotech prior to approval. You can't lose more than 100% with an option.

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