Post by rrtzmd on Oct 13, 2015 23:24:53 GMT -5
From the SEC filing:
"On July 31, 2014, MannKind Corporation (“MannKind”) and Amphastar France Pharmaceuticals S.A.S., a French corporation (“Amphastar”), entered into a Supply Agreement, pursuant to which Amphastar will manufacture for and supply to MannKind certain quantities of recombinant human insulin (“Insulin”) for use in MannKind’s product AFREZZA®. Under the terms of the Supply Agreement, Amphastar will be responsible for manufacturing the Insulin in accordance with MannKind’s specifications and agreed-upon quality standards. MannKind has agreed to purchase annual minimum quantities of Insulin under the Supply Agreement of an aggregate of approximately €120.1 million in calendar years 2015 through 2019. MannKind may request to purchase additional quantities of Insulin over such annual minimum quantities.
Unless earlier terminated, the term of the Supply Agreement expires on December 31, 2019 and can be renewed for additional, successive two-year terms upon 12 months written notice, given prior to the end of the initial term or any additional two year term. MannKind and Amphastar each have normal and customary termination rights, including termination for material breach that is not cured within a specific time frame or in the event of liquidation, bankruptcy or insolvency of the other party. In addition, MannKind may terminate the Supply Agreement upon two years’ prior written notice to Amphastar without cause or upon 30 days prior written notice to Amphastar if a controlling regulatory authority withdraws approval for AFREZZA®, provided, however, in the event of a termination pursuant to either of these scenarios, the provisions of the Supply Agreement require MannKind to pay the full amount of all unpaid purchase commitments due over the initial term within 60 calendar days of the effective date of such termination."
A number of things stand out:
1) 120 million Euros seems like an awfully lot of insulin to contract ahead of a launch. How much afrezza would that produce?
2) MNKD can't terminate without two whole years written notice? Is that not an awfully long "lead time" for MNKD to anticipate its insulin needs -- especially ahead of the launch?
3) MNKD is required "to pay the full amount of all unpaid purchase commitments due over the initial term," but what are these "commitments." Is MNKD required to purchase so much per quarter? Have they bought any so far?
"On July 31, 2014, MannKind Corporation (“MannKind”) and Amphastar France Pharmaceuticals S.A.S., a French corporation (“Amphastar”), entered into a Supply Agreement, pursuant to which Amphastar will manufacture for and supply to MannKind certain quantities of recombinant human insulin (“Insulin”) for use in MannKind’s product AFREZZA®. Under the terms of the Supply Agreement, Amphastar will be responsible for manufacturing the Insulin in accordance with MannKind’s specifications and agreed-upon quality standards. MannKind has agreed to purchase annual minimum quantities of Insulin under the Supply Agreement of an aggregate of approximately €120.1 million in calendar years 2015 through 2019. MannKind may request to purchase additional quantities of Insulin over such annual minimum quantities.
Unless earlier terminated, the term of the Supply Agreement expires on December 31, 2019 and can be renewed for additional, successive two-year terms upon 12 months written notice, given prior to the end of the initial term or any additional two year term. MannKind and Amphastar each have normal and customary termination rights, including termination for material breach that is not cured within a specific time frame or in the event of liquidation, bankruptcy or insolvency of the other party. In addition, MannKind may terminate the Supply Agreement upon two years’ prior written notice to Amphastar without cause or upon 30 days prior written notice to Amphastar if a controlling regulatory authority withdraws approval for AFREZZA®, provided, however, in the event of a termination pursuant to either of these scenarios, the provisions of the Supply Agreement require MannKind to pay the full amount of all unpaid purchase commitments due over the initial term within 60 calendar days of the effective date of such termination."
A number of things stand out:
1) 120 million Euros seems like an awfully lot of insulin to contract ahead of a launch. How much afrezza would that produce?
2) MNKD can't terminate without two whole years written notice? Is that not an awfully long "lead time" for MNKD to anticipate its insulin needs -- especially ahead of the launch?
3) MNKD is required "to pay the full amount of all unpaid purchase commitments due over the initial term," but what are these "commitments." Is MNKD required to purchase so much per quarter? Have they bought any so far?