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Post by mnkdfan on Dec 18, 2014 1:32:54 GMT -5
I like your positive outlook Tchalaa, however, I think Sanofi will look to charge more for Afrezza than your estimated $2200.00/yr. The reason I think Sanofi will charge more is due to the tier 3 designation and seemingly an acceptable insurance pricing when compared to Victoza, Byetta, and Bydureon see below pricing 2012: "In a call with analysts, Amylin said the drug is priced in a manner to get Bydureon to as many people as possible: $323.44 for a one-month supply, or $4,200 a year. Victoza low- and high-doses cost about $3,400 and $5,000 per year, respectively. Byetta high dose costs about $3,500 annually, noted ISI Group analyst Mark Schoenebaum." Another market for penetration is the insulin pen which is about $3.9B/Yr: "Insulin pens are the primary driver of increased expenditures in diabetes. These compact preloaded injectors are much simpler to use than vials and syringes. From 2009 through 2012, the total volume of diabetes prescriptions increased by 4.6 percent while the number of prescriptions for insulin pens grew by 23.2 percent, according to projections based on data from IMS Health. In the same period, total expenditures for insulin pens increased by 129 percent, from $1.7 billion to $3.9 billion." www.mmm-online.com/bydureon-approval-a-shot-across-bow-for-victoza/article/225368/www.managedcaremag.com/archives/2013/6/though-costly-insulin-pens-facilitate-better-adherenceIt would seem Sanofi could easily $3000/yr for Afrezza......
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Post by brentie on Dec 18, 2014 8:47:15 GMT -5
For those interested, take a look at one of MNKD's old competitors Generex Biotech (GNBT). They were trying to develop an oral insulin. Ouch finance.yahoo.com/q?s=gnbt&ql=1Having talked to Generex mngmt at an investment conference and looked at their 'science' closely I used to wondered if that company wasn't simply one big fraud who's only purpose was to keep big paychecks coming. They also had a way of always finding the thing of the week to start work on but never seemed to actually move anything forward. I wouldn't be surprised if they weren't working on Ebola right now... JPG Generex Announces Publication of Ebola Vaccine White Paper by Antigen Express www.prnewswire.com/news-releases/generex-announces-publication-of-ebola-vaccine-white-paper-by-antigen-express-916439190.html
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Post by liane on Dec 18, 2014 9:00:51 GMT -5
brentie comes through again! BTW, I hope OOG sees your new Avatar!
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Post by brentie on Dec 18, 2014 9:15:57 GMT -5
I had OOG in mind when I posted it. _
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Post by liane on Dec 18, 2014 9:28:17 GMT -5
Oh, those are funny!
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Post by otherottawaguy on Dec 18, 2014 11:52:31 GMT -5
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Post by mnholdem on Dec 18, 2014 13:14:55 GMT -5
I like your positive outlook Tchalaa, however, I think Sanofi will look to charge more for Afrezza than your estimated $2200.00/yr. I don't know if I agree with this assessment. Keeping the price competitive with injectable RAA insulin has been stated by Sanofi, but if they can price it LOWER the 3rd Party payers will take note.
This pricing is possible because the margin is actually greater than 75% rather than 50% used in the calculations above. There was a thread posted on this issue once, when Matt Pfeffer compared the MannKind-Sanofi [Profit-Sharing] Agreement to a mid-20% royalty about six months ago.
Someone who knows how to reverse calculate, posted the calculations that illustrated that a 20% royalty deal equates to about a 70% profit margin. I emailed Matt about this and he wrote back: "Hah! I hadn't thought of that when I made the remark. Someone was bound to figure it out, but the deal is actually closer to a 25% royalty."
I figure about 85% profit margin, which would significantly increase earnings in the table posted above. It also means Sanofi/MannKind can afford to be aggressive in competitively pricing Afrezza.
This will accomplish two goals:
- Obtain preferred Tier designation from insurance companies
- Take market share away from the competition
The U.S. market already provides the highest margins of any country. Sanofi's strategy for pricing Afrezza may increase overseas to make more profits - especially if (I mean when) Afrezza's popularity in the U.S. is confirm by quarterly sales growth.
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Post by papihoyos on Dec 18, 2014 13:59:27 GMT -5
25%/35% = 71.42% margin
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