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Post by mnkdmorelong on Jan 16, 2016 18:00:11 GMT -5
You do not realize that it no longer 2014. Afrezza is no longer the fresh product that everyone wants. The marketing of Afrezza failed in the US under SNY's control. The economics for the next partner has changed. MNKD is no longer selling in Neiman Marcus. ROW markets are Wal-Mart types. MNKD will not get the huge up front payments you are expecting. You are only guessing on COGS. Why would you create a model based on this? One question. How can Afrezza no longer be a fresh product that everyone wanted as you state when the vast majority of doctors and diabetics don't even KNOW IT EXISTS to this day? For example, today I asked a pharmacist at a major grocery store if she had heard of Afrezza, the inhaled insulin. She said it sounded familiar and "is it even approved yet?" I laughed. Only those who follow the stock seem to know it exists but many in the medical community still don't. If they don't, you can bet many diabetics don't. Look at it from the perspective of BP. They have seen a MNKD/SNY enter into a partnership to market Afrezza. Given the caliber of the product and the market size, both parties had expectations for first year sales. Actual sales for the first year will come in less than $10 mln which is way below anyone's expectations. What is a BP to think? SNY sucks and anyone else can do better? SNY spent $400 mln and walked away from a partnership. They may suck but not that much. If I were the person at the BP who is thinking about being the next man up, I would not even contemplate high offer. This bias will be in play whatever BP they approach. I know that Afrezza awareness is not 100%. I think after the failed DTC, SNY gave up and just went through the motions. It does not take much to create $50 mln in Afrezza sales. This works out to about 2% of the diabetic population in the US. Not everyone needed to be aware of Afrezza to achieve a modest sales goal. The actual number came in less than $10 mln for the full year. These are the numbers a prospective new BP partner is looking at.
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Post by mnkdmorelong on Jan 16, 2016 17:41:29 GMT -5
The article you reference contradicts your experience. Quoted from the link you provided: "Cost Compared to Emergency Room Though urgent care is more expensive than visiting a primary care physician, it's important to note that it is cheaper than going to the emergency room. This is because the emergency room has a much larger overhead. They need to staff more robustly including specialists, surgeons and nurses, as well as house and maintain specialized equipment for life threatening diagnosis and treatment. Not only is the copay for visiting urgent care lower than visiting the emergency room, the overall cost of diagnostics and procedures are also lower. Because of the lower cost, if it is possible to visit urgent care, it is suggested in most cases..." Further, I pulled the following from my plan provider's site (Anthem BlueCross BlueShield): www.anthem.com/health-insurance/provider-directory/searchcriteria?brand=abcbs&provtype=urgentcare"Urgent Care and other ER alternatives Consider using these options when you need health care quickly, but can’t see your usual doctor. These clinics are often open nights and weekends, and cost about the same as a doctor visit. Find out more about Urgent Care and other ER alternatives." I think it depends on the insurance plan. I paid an ER co-pay in my most recent visit. The article did say that urgent care cost more than PCP.
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Post by mnkdmorelong on Jan 16, 2016 17:08:36 GMT -5
mnkdlongmore, Regarding the Eurozone and Japan as less developed countries displays an ignorance that's better avoided. Blocking members is a feature as this board that I really appreciate. And you can't read. Japan was not mentioned. The rest of the world, including the EU pays less for drugs.
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Post by mnkdmorelong on Jan 16, 2016 16:29:12 GMT -5
I am very sorry but the numbers do not add up. You know that the US pays the most for drugs. There is a pecking order and the less developed countries pay the least. Off the top of my head, Afrezza was priced by SNY at $7.41/day per user. The competitive price for other RAA is $3.14/day/user. I did a computation based on known data that at the lower price, MNKD would have to sell $1.2 bln/yr in Afrezza to break even. If MNKD sells at lower ASPs in emerging countries, the breakeven point becomes even more preposterous. There is not 1 bln of upfront money to be received from emerging markets. It's a cheaper market. I must not be making myself clear on what I am suggesting Mannkind do: As an example, for a one time payment of $350 Million, Mannkind sells the entire Eurozone Afrezza franchise to a BP who would then own 100% of the rights to market and distribute to the Eurozone forever. They could keep the name Afrezza or name it something else. The BP would use Danbury mfg as their supplier which would part of their cogs. BP only pays for what they sell and when profitable, share a small sales royalty back to Mannkind. If Cogs are 50%, how long does it take BP to recoup payment. After $700 Million they are break even. Is it realistic to think BP could sell $250 Million a year for 10 or more years? Do something similar for Asia and the Middle East. That's where the $1 Billion up front comes to Mannkind, then the product acquirer owns the brand in their region forever. You do not realize that it no longer 2014. Afrezza is no longer the fresh product that everyone wants. The marketing of Afrezza failed in the US under SNY's control. The economics for the next partner has changed. MNKD is no longer selling in Neiman Marcus. ROW markets are Wal-Mart types. MNKD will not get the huge up front payments you are expecting. You are only guessing on COGS. Why would you create a model based on this?
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Post by mnkdmorelong on Jan 16, 2016 16:23:01 GMT -5
I am very sorry but the numbers do not add up. You know that the US pays the most for drugs. There is a pecking order and the less developed countries pay the least. Off the top of my head, Afrezza was priced by SNY at $7.41/day per user. The competitive price for other RAA is $3.14/day/user. I did a computation based on known data that at the lower price, MNKD would have to sell $1.2 bln/yr in Afrezza to break even. If MNKD sells at lower ASPs in emerging countries, the breakeven point becomes even more preposterous. There is not 1 bln of upfront money to be received from emerging markets. It's a cheaper market. so now its $1.2 bln per yr to break even.. up from $500 mil ? Yes, several on this board came up with reliable quantitative data and I rolled it into the economic model based on the SNY deal. The $500 mln did not take into account that the SNY deal was a de facto 25% royalty deal. MNKD needs to cut Afrezza prices by at least 50% to be competitive in the US. To be competitive in emerging markets, the ASP goes down even further. Declining contribution margin (net dollars received by MNKD) per unit sale only drives the break even point higher.
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Post by mnkdmorelong on Jan 16, 2016 14:06:47 GMT -5
I believe the strategy is beyond acute care to include longer term mgmt of the disease. This would include education, dosing and monitoring. If the lobbyist stay away it will ultimately show less or no basil and true reversal or avoidance of complications. Therefore, this should change the calculus of Insurance as it ultimately shows and measures cost reduction through a breakthrough therapy of Afrezza. I'm sure not overnight but that's where I thought they were going with this concept. Even with limited success this would also light a fire under the snail endo & pc. It takes a spark, actually a large bonfire to signal the kind of change we need to drive Afrezza & TS forward. Agreed. The clinical trial that is needed is that with Afrezza, basal insulin usage goes down as does HbA1c. This would catch the eye of insurance and the docs. We have anecdotal evidence of this; this needs to be expanded to be proven as a known reality. It does not need to be a MNKD study with the FDA involved. It can be a group of large practices doing the study. Why would they do this? They want their names on the game changing paper.
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Post by mnkdmorelong on Jan 16, 2016 14:01:33 GMT -5
I am very sorry but the numbers do not add up. You know that the US pays the most for drugs. There is a pecking order and the less developed countries pay the least. Off the top of my head, Afrezza was priced by SNY at $7.41/day per user. The competitive price for other RAA is $3.14/day/user. I did a computation based on known data that at the lower price, MNKD would have to sell $1.2 bln/yr in Afrezza to break even. If MNKD sells at lower ASPs in emerging countries, the breakeven point becomes even more preposterous. There is not 1 bln of upfront money to be received from emerging markets. It's a cheaper market. if my memory services me correctly, that $7.41 a day was all 4 u doses. Just saying, more like 10 to11 buckaroos a day is where sanofi priced afrezza.
At $10-11/day, it makes the economics worse.
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Post by mnkdmorelong on Jan 16, 2016 13:50:18 GMT -5
In some countries it depends how well your bribes are placed. I am not totally kidding. This is why a local partner is very important. It's mostly a registration issue. MNKD must change the packaging to local language. I can see six months. But, but, but.......not a real solution to the cash problem because ASPs will be real low. I would disagree that ROW for Afrezza is not a solution to the cash problem. It is THE solution. The model will be to sell the rights to distribute Afrezza in a specific region for an upfront payment and possibility as small royalty % in return once that BP is profitable. The three major regions are Asia, the Eurozone, and the Middle East. I could envision the possibility of selling those distribution rights for several hundred million dollars up to a Billion to three different BP's. Of course MNKD would maintain rights to all U.S. Distribution for Afrezza and worldwide distribution rights on all other T/S applications for now. This extends the runway for several years as the company works to validate T/S through Afrezza. IMO. I am very sorry but the numbers do not add up. You know that the US pays the most for drugs. There is a pecking order and the less developed countries pay the least. Off the top of my head, Afrezza was priced by SNY at $7.41/day per user. The competitive price for other RAA is $3.14/day/user. I did a computation based on known data that at the lower price, MNKD would have to sell $1.2 bln/yr in Afrezza to break even. If MNKD sells at lower ASPs in emerging countries, the breakeven point becomes even more preposterous. There is not 1 bln of upfront money to be received from emerging markets. It's a cheaper market.
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Post by mnkdmorelong on Jan 16, 2016 13:41:22 GMT -5
I would be very surprised since insurance views urgent care as an emergency room visit. I have to believe that urgent care clinics want to remain that way. Taking on the masses reduces their ability to treat walk-in patients. That hasn't been my experience. I've visited an urgent care clinic several times after suffering tick bites and my insurance coverage listed the visits as normal doctor visits, billed by the individual doctors. www.urgentcarelocations.com/urgent-care-101/faq/why-is-my-copay-higher-for-urgent-care-centersMy experience has been different. I have been charged ER co-pays.
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Post by mnkdmorelong on Jan 16, 2016 9:01:46 GMT -5
How long will it take for Afrezza to become available worldwide? In some countries it depends how well your bribes are placed. I am not totally kidding. This is why a local partner is very important. It's mostly a registration issue. MNKD must change the packaging to local language. I can see six months. But, but, but.......not a real solution to the cash problem because ASPs will be real low.
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Post by mnkdmorelong on Jan 16, 2016 8:45:56 GMT -5
Urgent care visits are emergencies. Managing diabetes is chronic. These two are not the same and will cause confusion issues. A diabetic will have to turn his back on his practice-based endo in order to place his care with these diabetic care centers. It can be done but it will take time. If these centers are successful, it will pressure the practice-based endo to revise his thinking on Afrezza. All good, but it will take time. You'd be surprised how many urgent care centers are actually providing primary care. They're convenient and you don't have to wait a few weeks to get an appointment. I would be very surprised since insurance views urgent care as an emergency room visit. I have to believe that urgent care clinics want to remain that way. Taking on the masses reduces their ability to treat walk-in patients. The best way to go is a stand alone diabetes care center. The market is large enough. But the concept must be funded well so that current diabetics move their care over to the clinic. There is no endo in this country that will send his patient there to get better care. You must suck it out of him.
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Post by mnkdmorelong on Jan 16, 2016 7:51:56 GMT -5
Matt has spread the new idea of diabetics clinic. How can potential patients locate those clinics? How can potential patients locate prescribing endocrinologist? How to bring more patients into endo's office as patients? Internet is a great medium to utilize the above? How to do match making and help all parties? Welcome your thoughts. The CEO said he was also optimistic about an unrelated venture by a private firm that is looking to create a diabetes care center business model that can provide in-house services to urgent care centers throughout the country. The venture, he said, is bullish on Afrezza and is planning to use the drug as its top treatment for the disorder. The first center is expected to open next month in New Jersey. “They’ve coined the term ‘real-time diabetes management, powered by Afrezza,’ ” Pfeffer said. “This is an excellent opportunity for us, and it takes no money at all from MannKind.” source from: www.newstimes.com/business/article/MannKind-announces-Afrezza-marketing-plans-6757354.phpUrgent care visits are emergencies. Managing diabetes is chronic. These two are not the same and will cause confusion issues. A diabetic will have to turn his back on his practice-based endo in order to place his care with these diabetic care centers. It can be done but it will take time. If these centers are successful, it will pressure the practice-based endo to revise his thinking on Afrezza. All good, but it will take time.
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Post by mnkdmorelong on Jan 16, 2016 6:47:32 GMT -5
This is not to offend anyone. All executives, board members must have great resume to be on boards in the first place. But MNKD is facing some challenges, the tops are more crucial than ever. Marketing MNKD is not a traditional path, executives with similar experiences to give advise is crucial. Perhaps English is not your first language. But I understood what you are saying. Yes, MNKD will need leadership in the marketing area if they do not find a US partner. It is early days to know this outcome. For now and the near term, we must rely on Matt to secure significant financing to keep the BK bear away.
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Post by mnkdmorelong on Jan 15, 2016 16:17:50 GMT -5
For the past few years, so many thought that 2016 LEAPS seemed the way to go. Many option contracts were purchased and, as I post this today 697,297 contracts for call options remain open, ranging from a $0.50 to $20 strike price.
Those contracts are the equivalent of 69.5 million shares of MNKD and for some time I wondered where MM could come up with that many shares if these options were exercised (if a BO were to occur, for example). Well, it's a moot point after today, but I wonder if there will be upward pressure after the options for nearly 70 million shares expire.
I also wonder if other biotechs also have large open interest in the Jan 2016 calls. The biotech sector took a beating the 2nd half of 2015 and most of those stocks are in the red again today on this options Friday.
Could Monday bring the beginning of change or is this just business-as-usual cycles common in biotech? There are many ways to play options and most do not contemplate assignment of the derivative. A covered call is a simple example where the stock is already held by the option writer. A call spread combines a long and short option positions wherein the profit is derived by a rise in the long call's price. No stock trade hands when these positions are closed. Then there is the short call position that if and when assigned, results in a short stock position. I think most MNKD call options are used as a hedge against short MNKD stock for which there is many.
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Post by mnkdmorelong on Jan 15, 2016 11:19:21 GMT -5
You see a few sales reps drop off samples and assume that scenario applies to all reps? Why would you even write this? You really don't know. I was told by Ray Urbankski. Raymond W. Urbanski, MD, PhD 1990 drug launch; sales reps---> rep to docs---> docs write scripts. The environment has changed. I have it on tape. investors.mannkindcorp.com/events.cfm
Sorry Peppy, you are not coherent. I listened to the same event. Ray said "The environment has not changed." Dr. Urbanski is right. I am not against a new way. But it must work!
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