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Post by mbseeking on Oct 27, 2015 23:46:49 GMT -5
Agree.. this board is seems inexplicably benign toward SNY when there appears be very little achieved from their side of the contract so far.
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Post by vestful on Oct 28, 2015 0:17:31 GMT -5
I know what side I'm on. Let's wait and see.
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Post by dreamboatcruise on Oct 28, 2015 0:23:33 GMT -5
Does it really matter whether Sanofi walks away or not? At present, either way looks rather dark. Consider that, as it stands now, while granting they may be doing something behind the "curtain," publicly SNY appears to be putting little effort into doing the sorts of things that afrezza needs to attract more customers. In particular, Sanofi has yet to announce any trials that might demonstrate afrezza is better than its current " non-inferior" designation. Until that happens, significant reimbursement at a price providing a worthwhile profit margin is highly unlikely. This then translates into perhaps years of losses for MNKD and increasing debt as it utilizes the Sanofi loan facility. What is this speculation based upon? Do you have insight into cost of production that no one else does? How do you know that they couldn't make a worthwhile profit while selling 10% lower than other RAAs and simply being a more cost effective option rather than "superior"? Are you merely presuming because they don't sell at a cheaper price it is because they can't? |
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Post by beardawg on Oct 28, 2015 6:42:20 GMT -5
Something else I notice is that MannKind can decide to go it alone in any country. That would mean they get 100% of profits from that country. It would be sweet for them to go alone for the country that Al said wanted to buy $200 million worth.
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Post by mnholdem on Oct 28, 2015 7:58:27 GMT -5
If the inference is correct, logically Sanofi should not walk away. The debt is secured by literally everything MNKD owns. SNY controls sales and marketing, but doesn't "need" afrezza and it is wealthy enough that it can simply wait. It shares profits but since there aren't any, that's no loss. It shares expenses, but since it controls those, it can be as tight fisted as it desires. If afrezza sales suddenly "explode," SNY does fine. If they don't, MNKD "withers" away until SNY decides it wants to package MNKD's assets for shipment back to France.
It will certainly be very interesting to see how MNKD management responds to events over the next year. Very nice logic with regard to the Deerfield milestones, but Sanofi can only take MannKind assets (see your highlighted statement above) if MannKind loses controlling interest or goes bankrupt. Those assets are simply collateral for the Sanofi Loan Facility. Per the 8K filed related to the Loan Facility: "The outstanding principal of all loans under the Loan Facility, if not prepaid, will become due and payable on September 23, 2024 unless accelerated pursuant to the terms of the Loan Facility."
According to Section 11, in the event of default by MannKind, Sanofi may terminate its commitment to make any more advances and declare the balance of the loan immediately due and payable OR it may exercise any or all of its rights, power or remedies under the Collateral Documents or, if an Event of Default described in Section 10.5 [bankruptcy] shall occur, the principal of and accrued interest on the Loan shall become immediately due and payable without any notice, declaration or other act on the part of the Noteholder.
Does it make sense for Sanofi to rack up 100% of the expenses of marketing and developing (trials) Afrezza, only to end the Agreement and be reimbursed 35% of their expenses in another nine years? No, it doesn't make any sense at all.
www.sec.gov/Archives/edgar/data/899460/000119312514355920/d795532dex991.htm
----
I'm not calling you out as a short interest for explaining a "dark" thesis - one that I have seriously considered as well - but merely pointing out that the logic behind the short's "bankruptcy" scenario is flawed. If Technosphere were exclusive to Afrezza then, perhaps, MannKind could be taken advantage of and forced into bankruptcy in the manner you describe. As a MNKD investor, I know how much I stand to lose - 100% of my investment.
If I were a short, I wouldn't take the risk that MannKind does not have other pharmaceutical companies interested in developing and distributing other potential blockbuster Technosphere generic drug applications or in developing their own FDA-approved and branded API. There are many BP's that have patent expirations looming on their current blockbusters. Technosphere can extend those patent protections, which is big $$$$.
IMO, short interests are taking a terrible risk if they are foolishly betting that they'll draw a bankruptcy card to save their losing hand. Unless s/he's hedged the bet, a short stands to lose a lot more than 100%.
Good fortune all.
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Post by jbe on Oct 28, 2015 8:58:28 GMT -5
Interesting discussion and speculation...
I am in the camp that thinks Sanofi has done the absolute minimum to promote sales of Afrezza, advertising is the bare minimum, very little movement on improving insurance coverage, whatever new studies are going on are lowkey as well.
However, I do not believe Sanofi is looking to walk away from the deal: Afrezza is clearly a good product, and inhalable drug delivery is a new avenue that has sparked much interest (I recall a Google exec specificly mentioning they were interested in inhalable delivery when a Sanofi/google collaboration was announced awhile ago)....
So, no, I don't believe Sanofi is looking to walk away, instead, they just soon take a major interest in Mannkind as cheaply as possible (like they did with Regeneron).
Mannkind is already an established company in the US, it would be much more valuable for Sanofi to buy into Mannkind as is, cheaply, than to see MNKD to go bankrupt and then have to bid for Afrezza and Technosphere in the open market.
What does this mean for me, a long term investor? It means I have to wait, which I have much practice at with this stock.
Ultimately, Sanofi will follow the safest and most cost effective path to getting control of Afrezza and Technosphere, which is to take their time, watch MNKD go near broke, and then buy into MNKD as cheaply as possible (ie like they did with Regeneron).
Afrezza and Technosphere work very well, they are not going away, but MNKD put themselves at the mercy of Sanofi, and Sanofi is going to do what is best for Sanofi.
Luckily for me, I think what they do is slooowly going to work out for mnkd investors.
Just my opinion.
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Post by bradleysbest on Oct 28, 2015 10:02:19 GMT -5
It sure would be nice if Google took a position in MNKD! I think that very well may happen down the road....
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Post by peppy on Oct 28, 2015 10:38:52 GMT -5
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Post by nylefty on Oct 28, 2015 10:51:02 GMT -5
I am in the camp that thinks Sanofi has done the absolute minimum to promote sales of Afrezza, advertising is the bare minimum, very little movement on improving insurance coverage, whatever new studies are going on are lowkey as well. I am in the camp that has said from the beginning that it would take a full year for the docs to accept Afrezza and the majority of insurance plans to get on board. Therefore, it made no sense for Sanofi to spend millions on TV advertising until after the one year anniversary of the Afrezza launch. Why spend big bucks now when you can get much better returns for your investments next February? |
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Post by peppy on Oct 28, 2015 11:11:25 GMT -5
Interesting discussion and speculation... I am in the camp that thinks Sanofi has done the absolute minimum to promote sales of Afrezza, advertising is the bare minimum, very little movement on improving insurance coverage, whatever new studies are going on are lowkey as well. However, I do not believe Sanofi is looking to walk away from the deal: Afrezza is clearly a good product, and inhalable drug delivery is a new avenue that has sparked much interest (I recall a Google exec specificly mentioning they were interested in inhalable delivery when a Sanofi/google collaboration was announced awhile ago).... So, no, I don't believe Sanofi is looking to walk away, instead, they just soon take a major interest in Mannkind as cheaply as possible (like they did with Regeneron). Mannkind is already an established company in the US, it would be much more valuable for Sanofi to buy into Mannkind as is, cheaply, than to see MNKD to go bankrupt and then have to bid for Afrezza and Technosphere in the open market. What does this mean for me, a long term investor? It means I have to wait, which I have much practice at with this stock. Ultimately, Sanofi will follow the safest and most cost effective path to getting control of Afrezza and Technosphere, which is to take their time, watch MNKD go near broke, and then buy into MNKD as cheaply as possible (ie like they did with Regeneron). Afrezza and Technosphere work very well, they are not going away, but MNKD put themselves at the mercy of Sanofi, and Sanofi is going to do what is best for Sanofi. Luckily for me, I think what they do is slooowly going to work out for mnkd investors. Just my opinion. A look back in time The original deal, which was inked in November 2007 and set to expire in 2012, will now run through 2017 screencast.com/t/6eBYF0BeiXO
www.fiercebiotech.com/story/sanofi-move-acquire-more-shares-regeneron-triggers-market-buzz/2013-02-11 February 11, 2013 Regeneron Pharmaceuticals ($REGN) notified investors today that its longtime partner Sanofi ($SNY) is moving to snap up a big chunk of its stock. Nov 11, 2009
Sanofi-Aventis Commits Over $2.8B to Regeneron in mAb Discovery Alliance www.genengnews.com/gen-news-highlights/sanofi-aventis-commits-over-2-8b-to-regeneron-in-mab-discovery-alliance/68174500/
Sanofi-aventis is extending its mAb partnership with Regeneron Pharmaceuticals by five years and will pay 60% more in annual funding.
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Post by Chris-C on Oct 28, 2015 11:30:32 GMT -5
Others on this board have observed, quite appropriately, that Afrezza would ordinarily NOT be a topic by Sanofi in a quarterly call for various reasons, most importantly because it constitutes a very minor portion of their global activities and revenues. It would thus be wise to consider that if Afrezza is not mentioned, there should be no anxiety. One would anticipate that if Sanofi discusses individual performance and development in their three main product areas and in their pipeline they will mention Lantus and the Toujeo launch. SNY is a global, multifaceted company with many moving parts. They are viewed as leaders in diabetes but also have a presence in many other arenas. With annual sales of ~ 34B Euros, revenue from Afrezza, even if it reached $1B US per year, would still represent less than 3 percent of their total revenues. At present, the sales are far less than 1 percent of revenue. This illustrates why claims that SNY is inattentive to its partnership responsibilities with Mannkind are unfounded. In my mind, since SNY knows that insurance coverage is a major hurdle, one can presume it is working on that (this will take time). SNY is also doing some marketing, training and education (as per the agreement) and it is conducting studies that can have an impact on label changes. These also take time. Unconfirmed reports that they have frozen their hiring of Afrezza sales reps, if accurate, may mean that they have reached the number of reps that is consistent with current market conditions/potential. As with any business that hopes to remain competitive, SNY has to use its resources wisely. This means it must devote its attention, its time and its money where and when they will have the greatest impact. Given this, I do not expect Sanofi to comment on its Afrezza sales or MNKD partnership agreement in this quarterly review. Chris C |
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Post by caveintemptor on Oct 28, 2015 12:03:43 GMT -5
Others on this board have observed, quite appropriately, that Afrezza would ordinarily NOT be a topic by Sanofi in a quarterly call for various reasons, most importantly because it constitutes a very minor portion of their global activities and revenues. It would thus be wise to consider that if Afrezza is not mentioned, there should be no anxiety. One would anticipate that if Sanofi discusses individual performance and development in their three main product areas and in their pipeline they will mention Lantus and the Toujeo launch. SNY is a global, multifaceted company with many moving parts. They are viewed as leaders in diabetes but also have a presence in many other arenas. With annual sales of ~ 34B Euros, revenue from Afrezza, even if it reached $1B US per year, would still represent less than 3 percent of their total revenues. At present, the sales are far less than 1 percent of revenue. This illustrates why claims that SNY is inattentive to its partnership responsibilities with Mannkind are unfounded. In my mind, since SNY knows that insurance coverage is a major hurdle, one can presume it is working on that (this will take time). SNY is also doing some marketing, training and education (as per the agreement) and it is conducting studies that can have an impact on label changes. These also take time. Unconfirmed reports that they have frozen their hiring of Afrezza sales reps, if accurate, may mean that they have reached the number of reps that is consistent with current market conditions/potential. As with any business that hopes to remain competitive, SNY has to use its resources wisely. This means it must devote its attention, its time and its money where and when they will have the greatest impact. Given this, I do not expect Sanofi to comment on its Afrezza sales or MNKD partnership agreement in this quarterly review. Chris C Simply to add that Sanofi knows about the time and effort necessary to create and develop a $ multi-billion diabetes segment: ever heard about Lantus, the first long-lasting insulin agonist ? |
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kyle
Newbie
Posts: 14 
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Post by kyle on Oct 28, 2015 14:24:41 GMT -5
My question to Matt:
Hello,
If Sanofi were to provide Mannkind with 90 days notice as allowed in the agreement would this be considered a material event and would a press release be issued?
Best regards,
Response:
From: Pfeffer,Matt [mailto:mpfeffer@mannkindcorp.com]
Sent: Tuesday, October 27, 2015 12:11 PM
To:
Subject: Re: Quick Question
Absolutely, yes.
Sent from my iPhone
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Post by liane on Oct 28, 2015 14:32:23 GMT -5
I've locked the thread - remarks straying off topic and getting personal.
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