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Post by savzak on Jan 21, 2015 22:26:44 GMT -5
"i wouldn't be surprised to see fake Diabetic ( Shorts ) pop up to scare potential Patients ...."
Lynn, you are absolutely right. This WILL HAPPEN. There's simply no question about it. 70 million shares short at $5 represents $350M in exposure to losses. They'll fight like hell and no holds are barred.
But here's the thing...the FUD will be directed at existing retail longs-folks like you and me who have been invested for years and are monitoring every perceptible signal to track how the launch is going.
All the internet FUD will have little effect on the early adopters, docs, nurses, pharmacists, pharma reps and all their friends and family that will be very confident, bullish longs if they are happy with the roll out and the benefits they are actually seeing from using Afrezza.
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Post by mannmade on Jan 21, 2015 23:04:32 GMT -5
IMHO I like to look at the things that may not speak much on their own/individually but when put together with other facts can speak volumes... So for this specific discussion about predicting revenue in which we know so little about Sanofi projections for market penetration or revenue I look at the following facts and think we come up with a very reasonable and accurate prediction or set of projections for a full 12 month pps guestimate
1.) Plant has a total capacity for 2m patients (as noted above) over 12 production lines, which equals a little over 166,000 patients per line.
2.) Currently one line running three full time shifts. Running three full time shifts, 24/7 is extremely important if it continues now that the initial supply target has been met as it indicates that Sanofi has a very robust sales projection which is the undercurrent or basis for my analysis below.
3.) It is my understanding that two additional lines will be operational by mid year with FDA approval. Half year of full production for two lines equals one full line of about 166,000 patients.
4.) So let's say we have 332,000 patients for the year at a price of 2,500 per patient per annum, that equals $830,000,000 in first year sales (may be a tad optimistic but if they continue with 24/7 shifts then the message (for anyone who cares to read it) from Sanofi imho is that they are projecting sales in this range
5.) Let's say COGS is 30%, $830,000,000 x.70 = $581,000,000
6.) MNKD's split is .35% so $581,000,000 x .35 = $203,350,000
7.) Mannkind will likely pay no taxes on revenue for the first three to five years with over 2B in carry forward losses so apply your personally preferred multiplier to the $203,350,000. Personally I am using a multiplier of 40 which equals a MC of $8,134,000,000 or about 4 x where we are today.
8.) Stock closed today at $5.34. Multiply by 4 and you get a share price of $21.36 which to me is reasonable
Now I have to note that this price does not reflect the value of any technisphere deals that may be announced this year, nor any costs/expenses or revenue associated with such deals.
But IMHO this represents about as reasonable analysis for reasonable predictive results that I can personally make at this time with the facts/knowledge currently available.
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Post by Deleted on Jan 22, 2015 2:05:03 GMT -5
IMHO I like to look at the things that may not speak much on their own/individually but when put together with other facts can speak volumes... So for this specific discussion about predicting revenue in which we know so little about Sanofi projections for market penetration or revenue I look at the following facts and think we come up with a very reasonable and accurate prediction or set of projections for a full 12 month pps guestimate 1.) Plant has a total capacity for 2m patients (as noted above) over 12 production lines, which equals a little over 166,000 patients per line. 2.) Currently one line running three full time shifts. Running three full time shifts, 24/7 is extremely important if it continues now that the initial supply target has been met as it indicates that Sanofi has a very robust sales projection which is the undercurrent or basis for my analysis below. 3.) It is my understanding that two additional lines will be operational by mid year with FDA approval. Half year of full production for two lines equals one full line of about 166,000 patients. 4.) So let's say we have 332,000 patients for the year at a price of 2,500 per patient per annum, that equals $830,000,000 in first year sales (may be a tad optimistic but if they continue with 24/7 shifts then the message (for anyone who cares to read it) from Sanofi imho is that they are projecting sales in this range 5.) Let's say COGS is 30%, $830,000,000 x.70 = $581,000,000 6.) MNKD's split is .35% so $581,000,000 x .35 = $203,350,000 7.) Mannkind will likely pay no taxes on revenue for the first three to five years with over 2B in carry forward losses so apply your personally preferred multiplier to the $203,350,000. Personally I am using a multiplier of 40 which equals a MC of $8,134,000,000 or about 4 x where we are today. 8.) Stock closed today at $5.34. Multiply by 4 and you get a share price of $21.36 which to me is reasonable Now I have to note that this price does not reflect the value of any technisphere deals that may be announced this year, nor any costs/expenses or revenue associated with such deals. But IMHO this represents about as reasonable analysis for reasonable predictive results that I can personally make at this time with the facts/knowledge currently available. a big disclaimer would be and honestly the most important one would be *****assuming 100% sales of the product that comes out of the production line.
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Post by mnholdem on Jan 22, 2015 6:33:54 GMT -5
Re: Off-line discussion between mannmade & baba of Technosphere being reverse engineered.
Word is that India is the most notorious for counterfeiting, followed by China. In the case of Technosphere, however, the process of manufacturing the particle, even if know in theory, requires specialized equipment. This applies to the new process as well. MannKind has over two hundred patents on its technology, which will protect it in Europe and Japan (the next launch sites per Sanofi). The issue of stealing Technosphere to create other drugs is a possibility, but not likely. China and India have the highest concentrations of diabetics in the world, though, so there will certainly be financial incentives to steal the Technology. Some believe it's why China insists that products distributed in China must also be manufactured in China, even if owned by foreign companies.
All said, I think sufficient international protections exist to guard against unlicensed used of Technosphere. MannKind will probably remain vigilant regardless.
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Post by Deleted on Jan 22, 2015 8:16:30 GMT -5
Since when has a small thing like 200 patents stopped India and China from stealing technology ?
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Post by babaoriley on Jan 22, 2015 11:03:37 GMT -5
"My main concern is that people typically only take the time to share about an Experience if it's Really Good or more so Really BAD , I'm remaining Optimistic re : this but I hope to see a ton of Affrezausers blogging bc that might be the one thing that can screw us (& the way most blog sights are anonymous ) I wouldn't be surprised to see fake Diabetic ( Shorts ) pop up to scare potential Patients .." Gosh, Lynn, you're thinking like I do! Not good, don't even visit the dark side, some never return....
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Post by mannmade on Jan 22, 2015 11:42:15 GMT -5
iam2sekc4u2002, You are absolutely right and I agree with you... However, what I am trying to suggest is that Sanofi (along with Mannkind) have conducted/done all sorts of surveys, studies and other research as their DD prior to the partnership agreement. And so I am suggesting that while we are left (for the moment) to grope in the dark, they most certainly are not, as they have access to all the "Insider Information" (they of course are the insiders) that each of us would love to have to base our investment decisions on. So instead I am trying to look at the factual signs from Sanofi that we have so far which I believe may telegraph/predict what their actual thinking and reasoning may be. Hence the above analysis based on the premise around current production shifts and the numbers against product that will be produced that will result if continued. This allows me to then extrapolate what I think would be a reasonable revenue projection to then do the rest of the math that gets me to my predicted share price for the first 12 months after launch. Hope it makes sense... But again, as you state no matter what the numbers I do realize the product must sell... Which I believe most if not all members of this Board believe it will...
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Post by Deleted on Jan 22, 2015 12:02:19 GMT -5
iam2sekc4u2002, You are absolutely right and I agree with you... However, what I am trying to suggest is that Sanofi (along with Mannkind) have conducted/done all sorts of surveys, studies and other research as their DD prior to the partnership agreement. And so I am suggesting that while we are left (for the moment) to grope in the dark, they most certainly are not, as they have access to all the "Insider Information" (they of course of the insiders) that each of us would love to have to base our investment decisions on. So instead I am trying to look at the factual signs from Sanofi that we have so far which I believe may telegraph/predict what their actual thinking and reasoning may be. Hence the above analysis based on the premise around current production shifts and the numbers against product that will be produced that will result if continued. This allows me to then extrapolate what I think would be a reasonable revenue projection to then do the rest of the math that gets me to my predicted share price for the first 12 months after launch. Hope it makes sense... But again, as you state no matter what the numbers I do realize the product must sell... Which I believe most if not all members of this Board believe it will... agreed..i wasn't doubting your analysis.. I hope everything that comes out of Danbury is sold.. right from the get go catching all the BS analysts by surprise
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Post by harshal1981 on Jan 22, 2015 19:40:34 GMT -5
Lets say that they have programmed production to match estimated sales.
We know that by the end of 2015 there will be a min of 3 lines firing, 24 /7.
We can safely assume that 1 line is currently working.
Old line capability = 2M /12 = 166K annual (as per Dr Mann's Danbury max output comment) New Lines = 110% of old line = 183K
Max Production = 167 + 183 + 183 = 533 K
Average production = (167 * 12) + (183 * 6) + (183 * 3) = 3651 / 12 = 304K * 11/12 (sales start in Feb) = 278K - 20% (estimated surplus production but hopefully less) = 223K (final answer, but hopefully higher)
223000 * 287 (monthly cost) * 12 * 23% (what mnkd gets) * 18 (conservative P/E) / 450M (share count) = 7.06 conservative pps (end of 2015) = 8.40 (if max supply matches demand)
But...If all machines are running for launch date in Feb 2015: 533000 * 287 (monthly cost) * 12 * 23% (what mnkd gets) * 18 (conservative P/E) / 450M (share count) = 16.88 pps (supply = demand)
Some may want to argue a higher P/E, and should adjust the numbers accordingly...
OOG
OOG: Can you help me understand the calculation a bit more. 2M is dosages? now if 166k is annual, why are you multiplying 223k (which I assume is also annual) with 12 in your final calculation?
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Post by otherottawaguy on Jan 22, 2015 22:51:55 GMT -5
223K is what they would be selling in 2015 if they over programmed for 20% capacity and not all three lines currently in production..
In the first scenario, I am assuming that only one line is currently firing. The second is going to come on line in 6 months into the year and the third will only be producing for three months.
In second scenario If all three lines are firing today, then 533k annual user could be serviced.
So a question arises, if you have been partnered for 6 months (26 weeks) and reach your initial production goals 2-3 weeks early, could you accomplish this with the availability of an additional line or two (just speculation)?
OOG
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Post by babaoriley on Jan 23, 2015 2:26:34 GMT -5
IMHO I like to look at the things that may not speak much on their own/individually but when put together with other facts can speak volumes... So for this specific discussion about predicting revenue in which we know so little about Sanofi projections for market penetration or revenue I look at the following facts and think we come up with a very reasonable and accurate prediction or set of projections for a full 12 month pps guestimate 1.) Plant has a total capacity for 2m patients (as noted above) over 12 production lines, which equals a little over 166,000 patients per line. 2.) Currently one line running three full time shifts. Running three full time shifts, 24/7 is extremely important if it continues now that the initial supply target has been met as it indicates that Sanofi has a very robust sales projection which is the undercurrent or basis for my analysis below. 3.) It is my understanding that two additional lines will be operational by mid year with FDA approval. Half year of full production for two lines equals one full line of about 166,000 patients. 4.) So let's say we have 332,000 patients for the year at a price of 2,500 per patient per annum, that equals $830,000,000 in first year sales (may be a tad optimistic but if they continue with 24/7 shifts then the message (for anyone who cares to read it) from Sanofi imho is that they are projecting sales in this range 5.) Let's say COGS is 30%, $830,000,000 x.70 = $581,000,000 6.) MNKD's split is .35% so $581,000,000 x .35 = $203,350,000 7.) Mannkind will likely pay no taxes on revenue for the first three to five years with over 2B in carry forward losses so apply your personally preferred multiplier to the $203,350,000. Personally I am using a multiplier of 40 which equals a MC of $8,134,000,000 or about 4 x where we are today. 8.) Stock closed today at $5.34. Multiply by 4 and you get a share price of $21.36 which to me is reasonable Now I have to note that this price does not reflect the value of any technisphere deals that may be announced this year, nor any costs/expenses or revenue associated with such deals. But IMHO this represents about as reasonable analysis for reasonable predictive results that I can personally make at this time with the facts/knowledge currently available. Mannmade, I love your numbers, but.... COGS does not include operating expenses like G&A, rent, taxes (property taxes will have to be paid, if not income taxes due to our loss carry forward), and all those salaries for the remaining scientists that are doing research and development on who knows what. We shouldn't have to spend much for advertising and the like, and perhaps that will come out of COGS, but don't think so. There's lots of pencils and erasers to be bought.
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