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Post by dreamboatcruise on Jan 23, 2015 10:25:50 GMT -5
For example, the Max unit equivalents in a box of afrezza is 600. A box of pens is 1500. Cost difference is like $400 for pens and $275 for afrezza. Assuming even 20% loss with owns still puts equivalent units at costing $550 for afrezza and $400 for novolog. Seems signifcant to me and a most likely point of contention of shorts A higher price might actually be a very good sign. To the best of our knowledge the production costs are such that it could have been priced equivalent to RAA pens... or at least that is what we were led to believe by Mannkind. If Sanofi decided to price at a premium, risking being left off formularies or stuck as non-preferred, it may mean that they have high level of confidence that the superior clinical performance of Afrezza will be recognized by the medical community and that widespread preferred formulary placement will be achieved even at a premium price. This strategy, if true, could unfortunately lead to a slow start, but could result in meaningfully higher profits in long run.
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Post by robsacher on Jan 23, 2015 11:30:04 GMT -5
In consideration of the deal in which MannKind and Sanofi arranged, it would make sense that both companies would also initially prefer to accept a less profitable start with the idea that market share would increase because of the positives associated with the issues connected to a more competitive price structure.
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Post by mnkdfan on Jan 24, 2015 11:51:11 GMT -5
I reached out to an old college friend that is a pharmacist at walmart in Dallas, TX. He looked up the price and found the 4-unit cost to be $256.00 and the 4/8-unit to be $286.00. He also mentioned that if someone gave him a prescription today that he can order Afrezza from his distributor Mckesson and get the drug the next day. So it would seem the launch can be a go anytime now.
He has not heard of Afrezza before but got very excited about the inhaling insulin option. He thinks it will be very successful because he always get asked on how to use and inject insulin for first time users because patients do not get adequate instructions from their doctors. These new users would often not come back for refills and just skip out until they feel really bad.
I will check back with him in the coming weeks and months to see how brisk Afrezza sells. He will read up more on MNKD this weekend and buy shares of MNKD Monday. According to him, this is a no brainer. Lastly, he mentioned that at this current price, Afrezza is very affordable.
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Post by liane on Jan 24, 2015 12:02:30 GMT -5
I reached out to an old college friend that is a pharmacist at walmart in Dallas, TX. He looked up the price and found the 4-unit cost to be $256.00 and the 4/8-unit to be $286.00. He also mentioned that if someone gave him a prescription today that he can order Afrezza from his distributor Mckesson and get the drug the next day. So it would seem the launch can be a go anytime now. He has not heard of Afrezza before but got very excited about the inhaling insulin option. He thinks it will be very successful because he always get asked on how to use and inject insulin for first time users because patients do not get adequate instructions from their doctors. These new users would often not come back for refills and just skip out until they feel really bad. I will check back with him in the coming weeks and months to see how brisk Afrezza sells. He will read up more on MNKD this weekend and buy shares of MNKD Monday. According to him, this is a no brainer. Lastly, he mentioned that at this current price, Afrezza is very affordable. Nice work! That puts it at $3072 - $3432 per patient per year.
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Post by mnkdfan on Jan 24, 2015 12:09:13 GMT -5
Thanks Liane...Just trying to contribute what little I can since I have learned so much from all you veterans over the years..
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Post by mannmade on Jan 24, 2015 12:32:13 GMT -5
I just went to my local CVS Pharmacy in Sherman Oaks, CA (Los Angeles suburb) and spoke in person with the pharmacist at the order desk. He said he can now order Afrezza and it should take about two days to receive. So I guess they are stocked and ready for sales at this point.
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Post by gomnkd on Jan 24, 2015 13:17:57 GMT -5
The pricing debate should focus on TCO - total cost of ownership. Al Mann and some trial participants have indicated that you need fewer BG tests with Afrezza. This is particularly true for correction doses. Many patients have expressed more frustration with taking BG tests. We'll know more as we get more data.
We live in a world where the cheapest one is necessarily not the winner. The cheapest mp3 player didn't capture the market. The one that was much more expensive but gave a great user experience won.
The hurdles I see are 1) confusion over titration, minimum dose & increments 2) 5% drop out rate due to cough 3) patients who smoked once and wondering if they can use 4) docs who are conservative and want to wait and see
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Post by jpg on Jan 24, 2015 13:46:33 GMT -5
The pricing debate should focus on TCO - total cost of ownership. Al Mann and some trial participants have indicated that you need fewer BG tests with Afrezza. This is particularly true for correction doses. Many patients have expressed more frustration with taking BG tests. We'll know more as we get more data. We live in a world where the cheapest one is necessarily not the winner. The cheapest mp3 player didn't capture the market. The one that was much more expensive but gave a great user experience won. The hurdles I see are 1) confusion over titration, minimum dose & increments 2) 5% drop out rate due to cough 3) patients who smoked once and wondering if they can use 4) docs who are conservative and want to wait and see In everything there are early and late adopters. As one of the usually 'conservative docs' I can state that if enough other docs prescribe we eventually prescribe good drugs also. The beauty of this one (Afrezza) is that it is massively differentiated and will be difficult to ignore. I switched from Mevacor to Lipitor somewhere in the 'middle of the wave' and stuck with Lipitor since. After that I didn't follow the 'leaders' who said such and such new cholesterol drug carried x % improvement in lipid lowering over Lipitor because to me Lipitor (for the majority of my patients) was good enough and I felt relatively safe prescribing it. For insulins there are no other non injectable insulins and a lot of the patients I see should be on an insulin but aren't. Because of this even the conservative MDs will eventually get onboard if and when this takes off. And let me reassure you there are enough early adopters in Family Practice/ Internal Medicine or in Endocrinology to move this froward quickly. With a bit of luck there might even be a small competition between different service providers (Endos vs non endos) to prescribe this and be seen as 'leaders in diabetic therapy'. JPG
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Post by dreamboatcruise on Jan 24, 2015 15:04:40 GMT -5
jpg... So how does a launch work? According to several posters, they've called their pharmacies and been told that Afrezza can be ordered and delivered in 1 to 2 days. As a doctor, how do you know when you can start writing prescriptions? Could you now? I'm guessing most doctors would wait for Sanofi rep to visit and drop off some sample devices (perhaps empty) so that doctors could show patients how to use it?
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Post by jpg on Jan 24, 2015 15:32:05 GMT -5
jpg... So how does a launch work? According to several posters, they've called their pharmacies and been told that Afrezza can be ordered and delivered in 1 to 2 days. As a doctor, how do you know when you can start writing prescriptions? Could you now? I'm guessing most doctors would wait for Sanofi rep to visit and drop off some sample devices (perhaps empty) so that doctors could show patients how to use it? As a hospital based MD (in Canada) my practice is different from what will happen in US PCP and endo offices. Academia vs community also has different interactions with pharma reps. There is often a bit of hand holding for the initial phases of a roll out. The 'loudness' of the launches are very variable and the way things are done has changed remarkably over the last few years for obvious reasons... A soft launch often is followed by a bigger launch at various scientific meetings. It's a bit like painting a dark coloured room a lighter colour. There needs to be multiple layers applied. Pharma companies (and marketing in general I guess) use different tools to change the patterns of practice. Local MD opinion leaders that believe in a specific new drug are often enlisted to educate, inform and reassure local MDs about new products. I've seen a lot of different ways this is done but it works. Wisely position good 'differentiated drugs' do very well and often rather quickly. In my experience bad products, no matter how hard they push, don't do well. If the pharmacy has the drug an MD with a valid licence in that state could now prescribe it. Being informed that the drug is 'actively available' would be a useful thing though. I very much doubt that without a bit of a 'hint' many MDs start prescribing something new. JPG
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Post by robsacher on Jan 25, 2015 17:29:25 GMT -5
Thank you jpg for your thoughtful analysis.
In regard to the 29 million people who are already diagnosed as American diabetics, would you care to speculate on what percentage of those diabetics would switch to Afrezza? I assume they would be those who poorly manage their disease because of their difficulties associated with needle based insulin.
My guess is that 5% could be a reasonable number over the next 18 months.
Also, how many diabetics who previously refrained from using needle based insulin would now start to use Afrezza?
My guess would be that if there are 29 million diagnosed diabetics, there could be at least another 3 million who are not yet diagnosed who could be Afrezza users within the next 18 months.
I know this is pure speculation but you would have more of a sense of what could happen than most of the rest of us.
Thanks.
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Post by robsacher on Jan 25, 2015 17:37:10 GMT -5
Liane,
Where is Afrezza's yearly cost in relation to insulin pens?
Thanks.
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Post by liane on Jan 25, 2015 18:28:55 GMT -5
robsacher,
Just read through this entire thread. A couple of figures are thrown about regarding the cost of the pens. A lot depends on dosage and wastage. I'm guessing that Afrezza will be comparable to the pens and come in at $3000 - $3500 per year.
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Post by jpg on Jan 25, 2015 19:54:22 GMT -5
Thank you jpg for your thoughtful analysis. In regard to the 29 million people who are already diagnosed as American diabetics, would you care to speculate on what percentage of those diabetics would switch to Afrezza? I assume they would be those who poorly manage their disease because of their difficulties associated with needle based insulin. My guess is that 5% could be a reasonable number over the next 18 months. Also, how many diabetics who previously refrained from using needle based insulin would now start to use Afrezza? My guess would be that if there are 29 million diagnosed diabetics, there could be at least another 3 million who are not yet diagnosed who could be Afrezza users within the next 18 months. I know this is pure speculation but you would have more of a sense of what could happen than most of the rest of us. Thanks. Hi Robsacher, It is very easy for me to speculate but only if these pages disappear in a few years... Short term a lot will obviously depend on the motivation/ skill of the Sanofi/ Mannkind JV which is why I was happy (relieved even) for a lower % of sale with Sanofi then another company willing to give a bigger %. Like I mentioned previously Novartis was my # 1 and Sanofi my # 2 choice. The near term marketing issue is not complicated for a company like Sanofi: this is their daily bread. They will do fine. Don't know how quickly the scripts will come in and if it will be fast enough for nervous longs but from my point of view the shorts and bears have blessed us with low expectations which was thankfully unopposed by Mannkind and Sanofi (here again I diverge significantly with some MNKD long 'management critics' (to be polite) who seem to care more about the share price in 2 days then in 2 years). I think that since partnership announcement and moving towards a 'soft launch' MNKD and Sanofi have played this very well. To answer your questions in a non quantitative fashion I think the needle phobic pitch is as you point out much more important then investors give this market opportunity credit for. Either I see only whips in my day to day practice or there is a huge massive opportunity there. In my opinion the groups that say 'needles are so small they don't hurt anymore and the glucose monitoring is what really hurts' just don't get it. It's so much more complicated then just the acute pain of injecting. I've posted extensively on this before and will spare those who read my musings this subject again! I will simply say that those that have variations on the 'needles don't hurt' arguments are probably not big fans of medical anthropology. Those poorly controlled on basal is another interesting group who would simply add Afrezza to their basal dosing. I already hear the 'then there will be needles group' come out in full swing saying that 'Afrezza is pointless because it doesn't get ride of needles'. This all or nothing mentality doesn't fit with the day to day reality of patients I see. Adding 3 more injections (and the complexity and risk of prandial sc injections of insulin) to a basal is a big big deal and can significantly decrease the quality of life of patients. The number of type 2 patients who go from basal alone to basal with pradial is in my estimate 1/10 of those who should make the transition. That is in itself a real and big market. Some investors seem to think that once a drug is FDA approved studies are only done to thinker around the edges for 'label improvements'. To make this a truly revolutionary blockbuster with 'Plavix or Lipitor like sales' what I am personally really interested in seeing over the next few months are well thought out post marketing studies. Off the top of my head a few studies that could move this from a billion $ a year drug (my low sale estimate if it doesn't do as well as I think it will) to a 'very significantly above 5 billion $' a year opportunity: -With Toujeo: Less severe hypoglycaemia, equivalent or better Hba1c and lower peaks (post prandial hypers) and valleys (hypos). -Early type 2 diabetics: slower progression (or even regression) of diabetes with Afrezza vs oral agents. This may seem like a big deal and complicated study but if I am right this could be a much easier and faster study then the many realize (a 6 month crossover study would be one option?). - Continuous glucose monitoring with or without Afrezza. This would be more of a trial done with one of the others mentioned here but would turn a lot of heads as we get a better understanding of the 'beat to beat' dynamics of diabetic glucose swings. -End organ changes:longer to do obviously but in certain high risk patient groups this could be done in under 2 years. One huge group would be gestational diabetics. Afrezza would fit in perfectly with how gestational diabetics are managed in North America now (prandial insulin as first line and targeting post prandial glucose levels and NOT HbA1c). The foetus is the 'end organ damage' and as far as I am concerned one of the most powerful arguments for looking (in all patients) at post prandial glucose levels as much if not more then HbA1c. -Mortality outcome studies with Afrezza. As for putting mortality as a primary outcome that would be a long term thing and I doubt many investors (including the companies paying for them...) will care to wait the multiple years these things take. These types of outcomes would be secondary outcomes to end organ change studies in high risk patient populations but could be surprising. The above studies are not an exhaustive list obviously and the JV might think of better ones. I would be disappointed though if over the next 6-12 months none of these types of studies were started. Again with just a few relatively simple (and relatively cheap) studies Afrezza could go from being 'just another blockbuster' to a 'top 5 of all times blockbuster'. I know A. Mann sees this and am convinced Sanofi also sees this. Eventually the market will also see this and we will look back on these early days of the launch wondering why some ever even speculated this could be otherwise then a huge success. Kind of like the iPod, iPhone, iPad, Tesla etc... JPG
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Post by xoxoxoxo on Jan 25, 2015 20:17:13 GMT -5
Comment from YMB.. Interesting comment comparing costs to Humalog.
"Afrezza is priced at Express Scripts but not available to be filled by prescription. Further it is not a preferred product. In my case it means that I would pay $100 co-pay vs. $70 for Humalog. However the saving co-pay kicks in by not having to get additional needles which are charged separately."
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