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Post by savzak on Feb 24, 2015 14:00:24 GMT -5
I was thinking about pipeline issues and the silence we’ve had up to now. If it continues after today (which I suspect it will), the grumbling will grow louder, at least from a certain segment of the longs. This got me to thinking about what might be going on behind the curtain with SNY. I am not speculating or predicting, but I’m wondering if it’s possible that SNY is trying to damper development efforts because of their interest in a potential buy out once they understand the realistic potential of Afrezza.
If SNY happens to be legitimately interested in a buy out of MNKD, I could understand that SNY might want to string MNKD along with that prospect and stress that they don’t want their potential future ownership of MNKD to be clouded with existing relationships with other pharma companies. If so, it would be irresponsible for MNKD management to allow themselves to be strung along without getting anything in return. So I’m wondering whether there’s ever been a deal somewhat akin to an option, where the potential acquiring company (SNY), pays to the potential target (MNKD), a fee not to do any deals or sell out to any other company. Strictly speaking, it would not be an option because there would be no right to purchase at a specified price. There would only be compensation for holding tight and doing nothing.
For example, they could agree that MNKD will not partner with anyone and will not sell itself to anyone for one year from March 1, 2015 in exchange for a quarterly payment of $FILL IN THE BLANKM. Further, if at the end of the one year term, neither party affirmatively terminates, the deal continues on a quarter to quarter basis until one or the other party gives 90 days notice of termination.
For whatever fee they agree to SNY could tie up MNKD, MNKD could get paid to be tied up and MNKD could still do its own phase 1 trials, so long as it doesn't give any rights to any other pharma.
As an aside, this type of deal would likely blow the shorts away. The interest of SNY in a buy out would be absolutely confirmed. MNKD would be getting a fat check every quarter. And MNKD could start trials so they enhance the buy out value several months down the road or, in the alternative, in order to hit the ground running with other partners or suitors in the event SNY decides not to pursue it a year from now.
Has anyone ever heard of a deal like that before? If not, I'd be interested in any critique of the idea as to any pros/cons or reasons why it isn't realistic.
Thanks.
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Post by otherottawaguy on Feb 24, 2015 16:08:41 GMT -5
Got a question for the group as well.
If MNKD is paying for trials of a "Soon to be off patent drug", could MNKD not market the product along with Sanofi and just bypass the former patent holder? Cards would really be in MNKD hands at that point.
OOG
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Post by agedhippie on Feb 24, 2015 20:58:08 GMT -5
Got a question for the group as well. If MNKD is paying for trials of a "Soon to be off patent drug", could MNKD not market the product along with Sanofi and just bypass the former patent holder? Cards would really be in MNKD hands at that point. OOG Yes, but there is the risk that you might get tied up in the US like Sanofi is trying to tie up the Lantus biosimilars. Better to go for something clearly generic if you don't have a partner, which is what they did with Afrezza. |
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Post by mnholdem on Feb 24, 2015 21:22:44 GMT -5
You threw me for a moment when you called Afrezza a generic but that's really what it is. Human insulin. The patent protection is in the delivery method, Technosphere, rather than in the active pharmaceutical ingredient.
It will be the same with the "new" drugs. Hakan said today that they have already selected the API for each of the pulmonary, pain and oncology drugs for which they have re-activated the development pipeline.
Technosphere is FDA approved. The selected API's are also FDA approved according to our CEO. This is why Hakan said that they will be expecting an expedited regulatory process from the FDA. This naturally would be applicable to the EMA and other international drug approval organizations.
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Post by zieg on Feb 24, 2015 21:40:38 GMT -5
Savzak,
You threw me for a loop as well when I first started reading the post. Part of me wonders if that is a possibility.
On a smaller scale, I have a couple friends that started a biz that now has close to 700 locations. I approached them with a similar formula to their business model but in a different "sister" industry. They loved the idea, but they can't participate because they have a hedge fund that approached them to take their biz to the "next level" with many more locations, but they can't have ANY involvement in any other business at all for a period of 6 years.
Having said that, I'm sure it happens at a higher level. I don't think that Al would sign anything that limited them from going in other directions, but maybe that's what the achievement milestone payouts are based on.
If their (MNKD's) only role w/regards to Afrezza is to make it, then I don't see how involvement in another project would compromise SNY's interest (unless) of course the same facility were to be used. If this is an opportunity cost, then SNY wants all dedicated facility space making Afrezza...... Unless that facility were to be separate and plans to make Afrezza were going to possibly start in another country so that production quantity would not suffer.
Interesting thoughts....
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