Levothyroxine Potential Commissions and MNKD Valuation

[brotherm1]

Amneal Pharma AMRX sells Levothyroxine

investors.amneal.com/news/press-releases/press-release-details/2018/Amneal-Announces-10-Year-Licensing-and-Supply-Agreement-with-Jerome-Stevens-Pharmaceuticals-Inc-for-Levothyroxine/default.aspx

Anneal has about $281M in cash

Amneal’s total revenues are about $2B annually

over $70M net income 9’mos ended Sept. (albeit they had a loss this last quarter do to a merger which brought the share price down a little)

PE only 11
at current $4.50 per share



137M shares outstanding (MNKD 235M)

$4B shareholders equity

market cap only $670M, less than MNKD’s current cap (it’s an enigma to me why it’s lower than MNkD’s and MNKD’s is higher). Comments about this anyone?

Though, among their products, metabolic/endocrine revenues (Levothyroxine? are about $40M annually). Assuming their metabolic disease /endocrine revenues are all from Levothyroxine, how much commission could MNKD make from Vertice on like sales? (How much commission percentage wise would we guess MNKD has agreed to?) Comments anyone?
br]Last AMRX quarterly report:
www.sec.gov/ix?doc=/Archives/edgar/data/1723128/000172312820000026/amrx-20200930.htm

[matt]

AMRX cannot have agreed to too high of a commission if the deal was for levothyroxine. This is a very old drug that has been around since at least the 1960's, was off patent by some time in the 1970's, and forty-years later there is plenty of generic competition. All of that translates to thin margins (like on most generics) so there is not a lot of extra profit to share with a commissioned sales partner.

That aside, if MNKD wants to drive sales of Afrezza then they need to get "face time" with endocrinologists. Even if MNKD never makes a penny in commission, so long as AMRX is subsidizing the cost of the sales force then it is a positive because it results in MNKD being able to afford more office visits which translates into more NRx. The other upside is that getting face time in any clinical environment has gotten very difficult and salespersons with more than one drug in their bag are generally more successful in getting that valuable face time.

As for why their market cap is what it is, consider the segment they are in. Generic drug companies have very limited ability to increase prices and the infrastructure costs are considerable. Until and unless some of their branded drugs take off, they are going to get generic drug company valuations. They also have a huge debt load, even for a generics company, which weighs down the equity value.

[nylefty]

Dec 18, 2020 9:29:11 GMT -5 matt said:

AMRX cannot have agreed to too high of a commission if the deal was for levothyroxine. This is a very old drug that has been around since at least the 1960's, was off patent by some time in the 1970's, and forty-years later there is plenty of generic competition. All of that translates to thin margins (like on most generics) so there is not a lot of extra profit to share with a commissioned sales partner.

It's an old drug but has always been in tablet form. This is in liquid form and has proven to have fewer side effects. That's the angle that will get the reps in the door.

[mango]

Dec 18, 2020 10:19:13 GMT -5 nylefty said:

Dec 18, 2020 9:29:11 GMT -5 matt said:

AMRX cannot have agreed to too high of a commission if the deal was for levothyroxine. This is a very old drug that has been around since at least the 1960's, was off patent by some time in the 1970's, and forty-years later there is plenty of generic competition. All of that translates to thin margins (like on most generics) so there is not a lot of extra profit to share with a commissioned sales partner.

It's an old drug but has always been in tablet form. This is in liquid form and has proven to have fewer side effects. That's the angle that will get the reps in the door.

Fewer side effects and superior absorption. The liquid form has been proven via clinical studies to be superior.

[wsulylecoug]

Dec 18, 2020 10:22:48 GMT -5 mango said:

Dec 18, 2020 10:19:13 GMT -5 nylefty said:

It's an old drug but has always been in tablet form. This is in liquid form and has proven to have fewer side effects. That's the angle that will get the reps in the door.

Fewer side effects and superior absorption. The liquid form has been proven via clinical studies to be superior.

I posted this on ST yesterday, but thought I would share here...the difference in QOL for all of us (happy wife happy life) has been quite dramatic!!

My wife takes Tirosint-SOL which as another brand of the liquid form. She was originally on a generic capsule but too many side effects. After trying several different brands and varying doses, it was determined that the “inactive” filler ingredients weren’t agreeing with her system. Since changing to liquid and taking a full dose by using half an ampule, side effects went away. Just one persons experience, but even a small percentage of this market could be a decent chunk of change while partially funding the existing sales force...I like it!

[lakon]

Liquids can go through spray-freeze-drying (SFD) processes...

[Charlie]

Inogen Announces Participation in the 39th Annual JP Morganwww.stocktitan.net › news › INGN › inogen-announces...
Dec 18, 2020 — Palantir Announces Inaugural Live Demo Day on January 26, 2021. ... MannKind and Vertice to Co-Promote Thyquidity™ (levothyroxine sodium) Oral . ... participating in the 39th Annual J.P. Morgan Healthcare Conference.