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Post by trenddiver on Aug 17, 2015 22:06:11 GMT -5
Just got back from vacation and I spent some time with someone who runs a small hedge fund ($200 million). The topic of Mannkind came up and he told me that his hedge fund just recently closed out his relatively large short position in Mannkind but stills owns lots of puts. He knows Jason Karp well and believes quite a bit of JK's short thesis. In fact he read me a portion of JK's recent comments of the recent MNKD CC. In summary, he said that the "Street" (very knowledgable Wall Street gamblers) believe that the CEO of Sanofi has no real commitment to Afrezza and further believe that's it's highly likely that Sanofi will terminate the partnership early in 2016. He thought that if that happens, the share price could drop to $1.50. i know that this is diametrically opposite of what we heard on the CC - and that's why I titled this thread "For What It's Worth".
Trend
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Post by notamnkdmillionaire on Aug 17, 2015 22:12:05 GMT -5
Just got back from vacation and I spent some time with someone who runs a small hedge fund ($200 million). The topic of Mannkind came up and he told me that his hedge fund just recently closed out his relatively large short position in Mannkind but stills owns lots of puts. He knows Jason Karp well and believes quite a bit of JK's short thesis. In fact he read me a portion of JK's recent comments of the recent MNKD CC. In summary, he said that the "Street" (very knowledgable Wall Street gamblers) believe that the CEO of Sanofi has no real commitment to Afrezza and further believe that's it's highly likely that Sanofi will terminate the partnership early in 2016. He thought that if that happens, the share price could drop to $1.50. i know that this is diametrically opposite of what we heard on the CC - and that's why I titled this thread "For What It's Worth". Trend For someone that has no real commitment, they surely are wasting a lot of money hiring people, advertising and starting clinical trials. Unless that is all smoke and mirrors by those sneaky french. |
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Post by kc on Aug 17, 2015 22:21:06 GMT -5
Just got back from vacation and I spent some time with someone who runs a small hedge fund ($200 million). The topic of Mannkind came up and he told me that his hedge fund just recently closed out his relatively large short position in Mannkind but stills owns lots of puts. He knows Jason Karp well and believes quite a bit of JK's short thesis. In fact he read me a portion of JK's recent comments of the recent MNKD CC. In summary, he said that the "Street" (very knowledgable Wall Street gamblers) believe that the CEO of Sanofi has no real commitment to Afrezza and further believe that's it's highly likely that Sanofi will terminate the partnership early in 2016. He thought that if that happens, the share price could drop to $1.50. i know that this is diametrically opposite of what we heard on the CC - and that's why I titled this thread "For What It's Worth". Trend Where we're you vacationing? Purgatory? |
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Post by cretin11 on Aug 17, 2015 22:21:36 GMT -5
Trend, thanks for sharing. Did he explain why his HF chose to close out its short position recently, i.e. why now as opposed to later (especially if he thinks the Sanofi jumping ship thesis has merit)?
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Post by dreamboatcruise on Aug 17, 2015 22:23:38 GMT -5
Damn convenient for the shorts that the management shakeup occurred.
Did you confront this hedge fund guy with the evidence that they are ramping up not slowing down expenditure? Just from a reputation standpoint I wouldn't think they'd want to ditch a product unless the product really fails on its' own merits... does he think it a bad product? How much does this guy know about what Afrezza is and does? Is he just following the herd?
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Post by trenddiver on Aug 17, 2015 23:01:53 GMT -5
Damn convenient for the shorts that the management shakeup occurred. Did you confront this hedge fund guy with the evidence that they are ramping up not slowing down expenditure? Just from a reputation standpoint I wouldn't think they'd want to ditch a product unless the product really fails on its' own merits... does he think it a bad product? How much does this guy know about what Afrezza is and does? Is he just following the herd? I certainly offered the bullish case as I know it. However I believe his HF and perhaps some other HF's who are shorting MNKD are taking their lead from JK, whose seems to be well respected in their circles. He doesn't think Afrezza is a bad product, he just believes that doctors won't be prescribing Afrezza in such quantities to support the current market cap anytime soon. He said that Sanofi new CEO will be evaluating all of its partnerships on a going forward basis and believes Mannkind will be on the chopping block. He acknowledged that there might be some events that could cause a short squeeze (insurance reimbursements, big jump in scripts, etc). Addressing cretin11 question, they liquidated the short position to take some profits and redeploy their assets, however, he did keep a position in the Jan 2016 $7 puts. |
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Post by Chris-C on Aug 17, 2015 23:49:42 GMT -5
There have been numerous different reasons given by shorts to support their negative view of the prospects for Afrezza. Time and again they have been proven wrong, and at each defeat, they "invent" another reason for shorting. They thrive on FUD. MNKD is a haven (like so many other biotechs) because it was screwed by the FDA in its labeling, and short interests know that they can capitalize on the additional time these hurdles require to continue spreading their FUD thesis. An ineffective SEC also provides them "cover" to engage in all kinds of dubious activities with impunity.
When it comes right down to it, the investment SNY made in MNKD is relatively modest for the potential it represents and the exclusive license it enjoys to market a truly novel and effective diabetes treatment. SNY understands the risk reward ratio of their investment better than the shorts. There is no logic behind the thesis of an early 2016 departure by SNY. The larger problem (and this is real as opposed to FUD) is that of covering 120M shares when the heat gets turned up. It's just a matter of time... and the cost of maintaining those short positions must be getting unbearable.
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rcc
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Post by rcc on Aug 18, 2015 0:22:12 GMT -5
Just out of curiosity, if you are long mnkd, did your talks influence you to sell?....or if you are short, did you short more?...thx
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Post by joeypotsandpans on Aug 18, 2015 1:19:44 GMT -5
Just got back from vacation and I spent some time with someone who runs a small hedge fund ($200 million). The topic of Mannkind came up and he told me that his hedge fund just recently closed out his relatively large short position in Mannkind but stills owns lots of puts. He knows Jason Karp well and believes quite a bit of JK's short thesis. In fact he read me a portion of JK's recent comments of the recent MNKD CC. In summary, he said that the "Street" (very knowledgable Wall Street gamblers) believe that the CEO of Sanofi has no real commitment to Afrezza and further believe that's it's highly likely that Sanofi will terminate the partnership early in 2016. He thought that if that happens, the share price could drop to $1.50. i know that this is diametrically opposite of what we heard on the CC - and that's why I titled this thread "For What It's Worth". Trend To be quite candid, honestly I sure hope that's true, that they believe that history will repeat itself...after all that has been their thesis after the thesis that it wouldn't get approved or wouldn't find a partner, etc, etc. That means the longs are betting that history will repeat itself with another short thesis going by the wayside...that is how they got themselves into the pickle they're in to begin with. They've had to literally double their short position in the past 12 mos., that does sound like gamblers that are chasing a bad bet and don't know when to say u n c l e. Either Sanofi has their reps and US marketing team fully snookered which I personally doubt they would go through a whole series of exercises in futility for what purpose I have no clue...then you would have to assume that after they put out a nationwide methodical campaign in educating physicians/diabetic educators through regular regional dinner seminars they would leave themselves vulnerable to a competitor/white knight swooping in to leverage the time and effort already spent. From my perspective fwiw, and from what I've stated in the past especially with their ballooning balance sheet that there was a reason Karp went on CNBC whether directly or indirectly when it looked like the first thesis was shot, then the second one, and now the third one (again to be honest each one is more ridiculous than the last). Personally, if it were the case and they sincerely believed it, why would they have to continuously publicize it...keep quiet and let the price drift north so you can short it from higher levels right? That would make a lot more sense to me if they truly believed it and hence why I love the statements made to you Trend. Thanks for relaying the conversation  |
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Post by trenddiver on Aug 18, 2015 1:51:16 GMT -5
I was very surprised when I learned that this friend of a friend was actually on the other side of the trade. And yes, they are gamblers (we are all gamblers in a sense). So I wanted to try to understand why he would be short the stock (or own puts). What I wrote was kind of a summary of the short thesis that was the basis of his short position. It was not about FUD-this is what he and others believe. He wasn't trying to convince me of anything or publicize it, he was just sharing his opinion. One thing I have learned in my old age is to listen to others who don't share your own point of view, especially those who have a lot more skin in the game than me.
Look, the bottom line here is revenues, which right now are pitiful and don't even come close to supporting the market cap of Mannkind. Nor do the revenues support the manpower and capital being expended by Sanofi. Sanofi could very easily say "we've done our best, it's a good product but just too tough a sell at this time. We're moving on". Personally I think it's a more likely scenario than the constant banter on this board about Sanofi buying or investing in Mannkind in the near future.
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Post by trenddiver on Aug 18, 2015 2:00:14 GMT -5
Just out of curiosity, if you are long mnkd, did your talks influence you to sell?....or if you are short, did you short more?...thx I am very long Mannkind, but don't like what I see. My original plan to sell was when Al Mann sells. Unfortunately he didn't sell, and Mannkind is stuck in this venture with Sanofi with little or no control of its destiny, and with ongoing accruing liabilities. (MNKD would have been much better off with a licensing deal). Further, Al Mann is not running the company. So although I haven't sold anything, I am reevaluating when I plan to sell. |
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Post by kball on Aug 18, 2015 3:38:48 GMT -5
No wonder i have insomnia.
Not kidding
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Post by cretin11 on Aug 18, 2015 5:37:26 GMT -5
To be quite candid, honestly I sure hope that's true, that they believe that history will repeat itself...after all that has been their thesis after the thesis that it wouldn't get approved or wouldn't find a partner, etc, etc. That means the longs are betting that history will repeat itself with another short thesis going by the wayside...that is how they got themselves into the pickle they're in to begin with. They've had to literally double their short position in the past 12 mos., that does sound like gamblers that are chasing a bad bet and don't know when to say u n c l e. Joey some of your post makes sense, but what I don't understand is the notion that the shorts are "chasing a bad bet and don't know when to say uncle." Haven't those shorts made a good bet and it's more a matter of when they decide to take profits? Please correct me if I'm missing something (I hope that I am). |
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Post by ashiwi on Aug 18, 2015 6:02:05 GMT -5
As of the end of the second quarter, institutions continue to add to their positions. Seems like MNKD is and continues to be the ultimate battle ground stock.
Should be an interesting next 5 months.
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Post by ripano on Aug 18, 2015 6:08:15 GMT -5
Big money hedge funds and money managers have Increased their shares of MNKD. Users of Afrezza are praising its efficacy. Millions being put into DTC ads. 24/7 support for customer service and insurance help. Adding more reps to sell Afrezza. Miles stone payments, credit line Etc etc. And your friend thinks Sanofi has NO commitment ? Does that make any sense if he actually believed that ?
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