MNKD & Sanofi Partnership Question | MannKind MNKD Message Board

nicktrantx
Newbie

Posts: 2

MNKD & Sanofi Partnership Question Aug 13, 2014 10:44:22 GMT -5

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Post by nicktrantx on Aug 13, 2014 10:44:22 GMT -5

You can call me stupid but I have several item on the list to ask and hoping for feedback. comment.

1. Sanofi offered around $1billion for the partnership granted by milestone payment -why everyone keep saying $150mil?
2. Expiration date for the partnership - we have not heard one yet . Will we have one? I hope it'll be.
3. This is Afrezza partnership and not the Technosphere application. So why look so down by many?
4. Can MNKD re-negotiate the agreedment?

As the old saying, we'll see sunshine after the rain.

Cheer!

Nick

dubylvs
Newbie

Posts: 15

MNKD & Sanofi Partnership Question Aug 13, 2014 10:58:45 GMT -5

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Post by dubylvs on Aug 13, 2014 10:58:45 GMT -5

Hope this helps you undestand the terms of the deal...

U.S.-based MannKind will receive an upfront payment of $150 million and potential further milestone payments of up to $775 million, depending on the drug's commercial success. Sanofi and MannKind will share profits and losses on a global basis, with Sanofi retaining 65 percent and MannKind the rest.

brentie
Postaholic

Posts: 1,937

MNKD & Sanofi Partnership Question Aug 13, 2014 11:24:44 GMT -5 mannmade and babaoriley like this

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Post by brentie on Aug 13, 2014 11:24:44 GMT -5

1. Sanofi offered around $1billion for the partnership granted by milestone payment -why everyone keep saying $150mil?

It's the old "Don't count your chickens before they're hatched". This article discusses it.

"Now let me shift gears a bit and look at the $775 million in milestones that was announced as part of the deal. These are potential payments that MannKind can earn when certain regulatory and sales goals are met. When I look at milestones in deals, I often look at it is a very simple manner. The first third of that money is essentially money in the bank. The second third is earned with good success. The last third requires "uber-success" to be earned. Rarely are all targets in a deal like this earned. While very simple, this model has served me very well over the years. In essence, look for $260 million to be easy to obtain, $260 million to be harder to obtain and the last $260 million to be at a level that everyone is swimming in money anyway, and the milestones will be a small part of the excitement."

seekingalpha.com/article/2418605-a-deeper-look-at-mannkind-sanofi-deal-and-valuation