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Post by itellthefuture777 on Jan 22, 2019 1:28:14 GMT -5
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Post by InvesterSam on Jan 22, 2019 3:48:51 GMT -5
MNKD: Update From Our Meeting With MNKD at JPM
Zacks Small Cap Research
January 21, 2019, 3:45 PM GMT
By Brian Marckx, CFA
NASDAQ:MNKD
READ THE FULL MNKD RESEARCH REPORT
MNKD: 2019 Outlook
We met with Steven Binder, MannKind’s (MNKD) CFO at the annual JP Morgan Healthcare Conference as well as The Biotech showcase conferences in San Francisco during the week of January 7th. We talked in depth on a number of topics including the details of the investor call held just a few days earlier. We gathered some interesting insights from our meeting that we have shared below.
DTC push to gain ground…
The International Diabetes Federation’s (IDF) Diabetes Atlas (8th edition) has estimated that approximately 30 million people were living with diabetes in 2017 in the U.S. According to the CDC, about 1.5 million new cases are diagnosed per year. Although insulin injection pens are ubiquitous and generally convenient to carry around, adherence to therapy has remained a challenge primarily due to hypo/hyperglycemia and, to some extent, as a result of anxiety associated with an injection, local sensitivity, pain and bruising.
One of the biggest challenges for the company has been accelerating growth of Afrezza. Our conversation with management included a discussion of their sales and marketing strategy for 2019. Included in their strategy is targeted DTC campaigns. As a reminder, the company had debuted its pilot TV commercial late in 2017 in twelve markets which resulted in an increase in new prescriptions and sales within eight weeks following airing. The most recent campaign began earlier this week on 26 national cable networks and local TV stations – the fruits of which we expect to see early next quarter.
The need for physician engagement is crucial to fully accelerate adoption of Afrezza and as part of their effort to do so, management has decided to restructure and reorganize the sales teams. This is expected to enhance the team’s ability to build deep relationships and help educate physicians of the clinical and quality of life benefits of Afrezza. A key part of this is educating prescribers about the substantive differences between Afrezza and subcutaneously-delivered insulin, including the proven superior time-action profile of MannKind’s inhaled insulin.
The strategy includes increasing the team’s productivity. In order to do so, the company exited 14 states at the end of 2018 and is now focusing on 30 states that they have identified as a driver of over half of the rapid-acting insulin market. Further, management has decided to reevaluate territories and create 15 new ones in order to zero-in on high-potential segments including California, Florida, New York and Texas.
PBMs and payors have been a substantial barrier to adoption between patients and Afrezza. Several of MannKind’s contracts with PBMs (CVS and Anthem) expired or begin to expire at the end of 2018-2019 period. The company has engaged in meaningful discussions with payors such as Kaiser regarding a mutually beneficial pricing arrangement and anticipates positive payor coverage beginning this year.
Previously, Afrezza had been saddled with prior authorizations (PAs). According to Fingertip Formulary, the leading provider of access and insight into the U.S. formulary data, Afrezza has unrestricted access to ~50% of commercial lives nationwide. Additionally, the company launched a two-in-one card this month that automatically applies co-pay assistance when a patient presents their prescription at the pharmacy for as low as $15. Easy implementation at the national level and electronic co-pay savings at the drug dispensing site increases patient awareness and improves adherence to therapy. MannKind also just launched a direct-purchase program, allowing patients to purchase Afrezza directly from the company for just $4 per day – providing affordable access to those on low incomes or without health insurance.
International expansion…
The company anticipates a regulatory filing for Afrezza in Canada in 1H 2019 and in E.U. in the latter half of the year. MannKind is also pursuing commercialization in India and Brazil. An underutilized manufacturing facility is one of the key elements that impacts costs and expanding the customer base internationally should help reduce this overcapacity and benefit margins.
Study results…
MKND is pursuing a pediatric indication for Afrezza, which could expand the aggregate size of their target markets. Clinical studies are underway and the company anticipates the program to be Phase III-ready by the end of 2019. MannKind is also investigating the use of Afrezza and One Drop's integrated digital diabetes care platform, which includes a mobile app, Bluetooth custom glucose monitoring meter called Chrome, test strips and an expert coaching service. The A-One study randomized T2D patients into two treatment groups with one group using the One Drop platform alone, while the other used Afrezza along with One Drop. The results of this six months study are expected sometime this year.
Dr. Phil Levine initiated a trial in T2D patients whose HbA1c levels were not within recommended guidelines when treated with oral agents, basal insulin or GLP-1 for 6 months. About 40 subjects were treated with Afrezza and we anticipate the readout from this study this year.
Moving the pipeline forward in 2019…
MannKind has three products with which they have partnered with United Therapeutics for PAH and Receptor Life Sciences in the cannabinoid space. In addition, the company has four development candidates in its pipeline - a triptan for acute migraine, a 5HT3 inhibitor for chemotherapy-induced nausea and vomiting (CINV), inhaled tobramycin for cystic fibrosis (CF) and an undisclosed compound targeting a large consumer driven market. While committed to executing their clinical development and pipeline strategies, management is also cognizant of making sure that they use their capital efficiently and effectively.
Capital Raise…
In order to execute on their strategy in the upcoming quarters as well as being aware of the volatility in equity markets, which could impact fund raising, management decided to raise capital in December of last year. From the support of existing shareholders as well as new investors, the company was able to raise $40 million and entered 2019 with roughly $70 million of cash on their balance sheet. Assuming Afrezza sales ramp as expected, the cash runway might extend to early 2020. Nonetheless, we believe the company is sufficiently funded for at least the current year.
Reiterating Price Target…
As we had already incorporated an assumed substantial equity raise, which was reflected in the forecasted outstanding share count in our model, this recent financing has no effect on our calculated fair value. As such, we are reiterating our $4.25/share price target.
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Post by peppy on Jan 22, 2019 4:04:44 GMT -5
here is what I read. "we are reiterating our $4.25/share price target."
I'll take it.
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Post by travis1953 on Jan 23, 2019 10:10:01 GMT -5
Talking about the pediatric trial, it says "to be Phase III-ready by the end of 2019." Any idea how long the phase III will take?
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Post by ltta on Jan 23, 2019 13:46:40 GMT -5
Talking about the pediatric trial, it says "to be Phase III-ready by the end of 2019." Any idea how long the phase III will take?
From the Afrezza Facebook site about the peds trial. It's on the Thompson January 15, 9:39 am thread.
www.facebook.com/groups/1491153011166114/about/"yes, so UFlorida is one of the sites. The research director said its moving slowly at their location. The protocols were not set up well and needed to be revamped. They didn’t do what they should have and it delayed the process. I don’t know much just that it was not ideal. Also, the instructions were laid out to bolus at the beginning of the meals and kids were coming back with lows of 30. The instructions should have been very clear or changed to bolus mid meal. Kids tend to eat slowly. And some of the nurses who were dosing the kids were doing it before they walked to lunch. Well, that was a disaster! Hopefully they got the kinks worked out." |
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Post by boca1girl on Jan 23, 2019 13:49:31 GMT -5
I would think MNKD would be hand holding these testing centers to make sure they knew what they were doing.
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Post by goyocafe on Jan 23, 2019 14:09:27 GMT -5
I would think MNKD would be hand holding these testing centers to make sure they knew what they were doing. They certainly have enough headcount and should be very aware of the fast action, thus sensitivity to time dosing properly. What a shame to even hear this type of feedback. |
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Post by goyocafe on Jan 23, 2019 14:18:37 GMT -5
And some of the nurses who were dosing the kids were doing it before they walked to lunch. Read more: mnkd.proboards.com/thread/10859/update-jpm-jan-21st?page=1#ixzz5dSZMHSmiI wonder if they check backgrounds of people doing these studies to see if they have ulterior motives. Plant a couple of nurses with a bias and this is what you end up with. The notion of dosing and then delaying the meal makes no sense. MC, this is something you can and must sink your teeth into. |
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Post by akemp3000 on Jan 23, 2019 14:35:50 GMT -5
Something about this feedback has a distinct smell to it...if even true.
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Post by longliner on Jan 23, 2019 14:48:56 GMT -5
Something about this feedback has a distinct smell to it...if even true. It almost smells like they have something in their shorts.  |
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Post by travis1953 on Jan 23, 2019 15:08:00 GMT -5
And some of the nurses who were dosing the kids were doing it before they walked to lunch. Read more: mnkd.proboards.com/thread/10859/update-jpm-jan-21st?page=1#ixzz5dSZMHSmiI wonder if they check backgrounds of people doing these studies to see if they have ulterior motives. Plant a couple of nurses with a bias and this is what you end up with. The notion of dosing and then delaying the meal makes no sense. MC, this is something you can and must sink your teeth into. Well, technically, isn't supposed to be administered before the meal? I doubt they would be allowed to dose it any other way. |
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Post by ltta on Jan 23, 2019 15:16:42 GMT -5
Something about this feedback has a distinct smell to it...if even true. It almost smells like they have something in their shorts. If you are implying I'm short.... you are very, very wrong. I've been in this stock since 2009 and have amassed a HUGE paper loss to date. Not something I'm proud of to say the least. I'm waiting for the turn around like everyone else.
I thought the comment on the Facebook page was worth posting, even if if made me cringe. Sorry if it wasn't a likeable post.
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Post by peppy on Jan 23, 2019 15:24:13 GMT -5
Talking about the pediatric trial, it says "to be Phase III-ready by the end of 2019." Any idea how long the phase III will take?
From the Afrezza Facebook site about the peds trial. It's on the Thompson January 15, 9:39 am thread.
www.facebook.com/groups/1491153011166114/about/"yes, so UFlorida is one of the sites. The research director said its moving slowly at their location. The protocols were not set up well and needed to be revamped. They didn’t do what they should have and it delayed the process. I don’t know much just that it was not ideal. Also, the instructions were laid out to bolus at the beginning of the meals and kids were coming back with lows of 30. The instructions should have been very clear or changed to bolus mid meal. Kids tend to eat slowly. And some of the nurses who were dosing the kids were doing it before they walked to lunch. Well, that was a disaster! Hopefully they got the kinks worked out." when I think about it, the care givers didn't know the difference. rapid acting analog say to pre-bolus 20 mins before you eat. So the child is sent to the nurses office and takes the dose. then goes to lunch room and stands in line. then finds a seat. etc, etc. They would need different protocol. |
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Post by mannmade on Jan 23, 2019 15:29:55 GMT -5
They should all watch the tcoyd videos as part of their training.
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Post by longliner on Jan 23, 2019 15:34:06 GMT -5
It almost smells like they have something in their shorts. If you are implying I'm short.... you are very, very wrong. I've been in this stock since 2009 and have amassed a HUGE paper loss to date. Not something I'm proud of to say the least. I'm waiting for the turn around like everyone else.
I thought the comment on the Facebook page was worth posting, even if if made me cringe. Sorry if it wasn't a likeable post.
Sorry, not intended as a dig at you! I appreciate information of all stripes. There is just such a concerted stream of disinformation that flows toward afrezza that I question the fingerprints on any new information regarding this product. Sorry about your position, it quite probably mirrors my own. |
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