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Post by jeremg on Dec 7, 2015 16:46:56 GMT -5
jeremg ... I'm not a believer in the sandbag scenario. If it were true, SNY wouldn't do the walking away... and MNKD has not put themselves in a very good position to justify MNKD walking away. Unless there were some smoking gun communication/email to point at that demonstrates SNY was working against Afrezza, I think it would be hard to make the case. Other potential partners would probably be hesitant to jump into a potential nasty legal battle. It doesn't necessarily mean they are taking explicit actions to "sandbag" or are working "against Afrezza", SNY could simply passively neglect Afrezza (like the way they coincidentally have been) and I believe that could still be characterized as "sandbagging" - so maybe we just disagree on semantics(?). If SNY is smart they will not let MNKD go, they will simply let MNKD and Afrezza naturally die on the vine through simple passive neglect, and you are absolutely correct in that MNKD has not put themselves in a very good position to justify MNKD walking away, just another mishap on the part of this wholly incompetent management team - putting every last egg in the SNY basket. I have to agree with your last piece of reasoning Other potential partners would probably be hesitant to jump into a potential nasty legal battle. I'm kindof confused after responding, You said "I'm not a believer in the sandbag scenario." but I don't see how any of what followed questioned the validity of the "sandbag scenario" - did I misread or misinterpret your position? |
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Post by compound26 on Dec 7, 2015 16:49:06 GMT -5
Actually that string of posts makes me nervous. One of the strongest advocates of MNKD is now raising possibility that MNKD will walk from SNY as potentially positive, throwing forth Google connection and making the unsubstantiated claim that tangible insurance improvement has been seen... seems like he is merely posting every hope based long argument from YMB. DBC, I think Nate is just saying these are all possibilities. And I think Nate is also suggesting, even if Sanofi walks away, Mannkind, by itself, or with a new partner, can still make Afrezza a success. I am also of this thinking. The fundamentals (all the signs point to the fact that Afrezza works and works greatly) have not changed. If any change, evidences are accumulating and growing everyday to support this observation.
The only thing changed is the share price, which greatly distorts people's judgment and sentiment.
However, even without much improvement in insurance, with the steady uptick of refills and some modest expansion of the prescribing base, it won't be difficult for Afrezza to sell at least 10-15 million a quarter 12 months from now. That will bring Mannkind much closer to break even (not close to earning a profit, but greatly reduces the quarterly cash burn rate). So we are really talking about 12 months' funds needs from this moment. Existing cash can at least sustain Mannkind to summer/fall of 2016. So we are really talking about two or three quarters' additional cash needs. Probably $50-60 millions. With Al on board, one thing he does have is that he can at least buy some time (or add some flexibility) in terms of the timing of raising additional capital. I.e., if needed, he can increase the Mann Group loan cap at least by a relatively small size (say $20-30 million at one shot) to wait out the downturn of share price and make a second offering or debt financing when the share price stabilize or is in an upward trend. Within the next few quarters, there definitely will be such opportunities for Mannkind to make a second offering or debt financing without significant dilution. It could be any one or more of the following events (which are likely events):
an announcement of a TS partnership with upfront payment,
Sanofi's release the next milestone payment (the development milestone),
Sanofi's demonstration of commitment (enrollment of the safety study) or starting of TV ads,
announcement of EU or Japan filing,
approval of Afrezza is any other coutries (Israel or others),
steady uptick in scripts,
some improvement in insurance, etc.So as stated above, all the signs point to the fact that Afrezza works. So there is no reason that either Mannkind or Sanofi will give up. See my post here for more detailed arguments. And even if Sanofi walks away, Mannkind, by itself, or with a new partner, can still make Afrezza a success. And the current sales of Afrezza is not that disappointing, if compared with Exubura, insulin pump (MiniMed) or Apidra (Sanofi). So both Sanofi and Mannkind have needed experience in overcoming soft launches and historically neither of them gave up under any those circumstances. |
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Post by mssciguy on Dec 7, 2015 16:49:20 GMT -5
mssciguy ... for what it is worth, shares have been returned to lenders recently, and interest rates are way down... so I don't think it credible to say loaned shares going into market had to do with price movement this past week. Obviously in the supply-demand equation the supply has been coming from somewhere else this past week. In hindsight I would have been much better off to have simply sold back in first half of the year when I got them into the lending program... so indeed there has been downside that more than ate up what I've received in interest. Though having held them, I've recouped a small chunk of my losses through the interest. Another case of "if it seems to good to be true, it probably is" .... I saw a great show on linktv last night called "Global Spirit" where the US fixation on individuality was called into question. We are all taught to fend for ourselves and get ahead, but as a S. American spiritual leader said, it's totally false. We are always part of a group (unless in solitary confinement). But Wall Street eggs us on with "Beat the Market" and it's all a big lie. Only the house wins in the long run, and if you don't believe me, just look at all those skyscrapers and million dollar penthouses. They all got that by inventing medicines and working in the fields or at McDonald's right--- hehehehe they're thieves that comply with laws poorly understood, and we are witnesses. Other than that, I am speechless. Happy holidays |
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Post by Deleted on Dec 7, 2015 16:50:34 GMT -5
The art of using the phrase "begs the question" correctly has long-since died. Sort of like about 40 years ago, when "I couldn't care less" became "I could care less." No, haven't lost my mind, although if I did, I likely wouldn't notice. Just cruising a couple of topics, and it's pretty depressing. A lot of the short side is represented here these days.The correct use of the term "short side" has apparently died along with it. What is "short-sided" about facing the reality which is $1.83? I'm assuming if your definition of "short side" holds true, "long-sided" could correctly be interchangeable with "delusional-sided". Now that's some of the smartest commentary on shorts/longs made in quite a while. Way too much focus on the shorts and tin foil hat scenarios involving conspiracies, trolling, etc etc Investing is a simple buy/sell system and nobody has a gun to your heads to do either. When I've been in your situation, I follow one basic rule ---> don't throw good money after bad. If MNKD offers some good news (for a change) such as a TS deal, or, if scripts start to take off for some unknown reason (I say unknown because at this point there's no reason to believe scripts will "just take off" without insurance coverage fixes and/or price adjustments that make buying afrezza an easy choice), the price won't get to 10 overnight. The current stock price is betting on complete failure so there's plenty of room to run this bronco if/when good news does hit. My point is this - you already have money on the table/skin in the game and given MNKDs situations (balance sheet and lack of scripts), there is no credible investment reason to add to your position right now. If/when things change for the better, you won't miss the upside. You might miss a few points which will feel like you missed the upside, but, that's the way it goes. Many are looking backwards and wondering how MNKD can be in the 1's. I'm looking at today with an eye for tomorrow and calculating how MNKD gets to 10 from here. So far by my metrics there is no equation that gets us there. As a result, there are no reasons to throw more money at MNKD. That's how my brain on my life and investment experiences works. For whatever that's worth.....lol |
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Post by mssciguy on Dec 7, 2015 16:57:07 GMT -5
The correct use of the term "short side" has apparently died along with it. What is "short-sided" about facing the reality which is $1.83? I'm assuming if your definition of "short side" holds true, "long-sided" could correctly be interchangeable with "delusional-sided". Now that's some of the smartest commentary on shorts/longs made in quite a while. Way too much focus on the shorts and tin foil hat scenarios involving conspiracies, trolling, etc etc Investing is a simple buy/sell system and nobody has a gun to your heads to do either. When I've been in your situation, I follow one basic rule ---> don't throw good money after bad. If MNKD offers some good news (for a change) such as a TS deal, or, if scripts start to take off for some unknown reason (I say unknown because at this point there's no reason to believe scripts will "just take off" without insurance coverage fixes and/or price adjustments that make buying afrezza an easy choice), the price won't get to 10 overnight. The current stock price is betting on complete failure so there's plenty of room to run this bronco if/when good news does hit. My point is this - you already have money on the table/skin in the game and given MNKDs situations (balance sheet and lack of scripts), there is no credible investment reason to add to your position right now. If/when things change for the better, you won't miss the upside. You might miss a few points which will feel like you missed the upside, but, that's the way it goes. Many are looking backwards and wondering how MNKD can be in the 1's. I'm looking at today with an eye for tomorrow and calculating how MNKD gets to 10 from here. So far by my metrics there is no equation that gets us there. As a result, there are no reasons to throw more money at MNKD. That's how my brain on my life and investment experiences works. For whatever that's worth.....lol Yes, if GSCO had inside information that a $1 target was a good price, it's time to face reality, they'll get their target price. Nobody has a gun to our heads but the charm factor has been overwhelming. I am afraid that the stock discussion on the German social media site is more objective than here. To put so much trust in SNY may have been detrimental or even fatal, and no Plan B is clear at this time. |
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Post by dreamboatcruise on Dec 7, 2015 17:00:18 GMT -5
jeremg... I don't believe they are sandbagging. I certainly hope they aren't because the rest of what I wrote is basically my reasoning that we're in deep trouble if SNY is sandbagging, because unlike what some have suggested, I think any way to a new partner would be hugely painful for MNKD shareholders. None of us really know what SNY and/or MNKD believes at this point. My purely speculative hunch is that SNY probably knew it would be a slow uphill battle for Afrezza given the label limitations, but they may well have not revealed to MNKD the level of difficulty they anticipated, thus allowing them to structure a deal where the upfront payments were minimized. Of course as time passes and still nothing tangible related to bettering the label or improving formulary, the more your sandbagging theory would seem to win out over my view.
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Post by EveningOfTheDay on Dec 7, 2015 17:07:33 GMT -5
jeremg ... I'm not a believer in the sandbag scenario. If it were true, SNY wouldn't do the walking away... and MNKD has not put themselves in a very good position to justify MNKD walking away. Unless there were some smoking gun communication/email to point at that demonstrates SNY was working against Afrezza, I think it would be hard to make the case. Other potential partners would probably be hesitant to jump into a potential nasty legal battle. I also think that the sandbag scenario is highly unlikely. The way I see it, Sanofi ditched a forward looking CEO, because he was rocking the boat too much, for a more conservative one. First thing Brandicourt does coming in is to try to stick to what had been working and neglect Afrezza in favor of Toujeo. This is mostly, even though it turn out to be the wrong move, a play it safe move. If SNY was desperate a year ago, you can imagine how much desperate they must be right now. They probably understand they can't let Afrezza go, but at the same time they are facing the reality that without a substantial investment and gamble, Afrezza will not rise to its full potential... and it is possible that the kind of mentality change that Afrezza needs in order to succeed is not something most BP are used to deal with, and perhaps not the kind of change Brandicourt is comfortable with. After all, Afrezza almost requires doctors and diabetic patients to hit a reset button in they way they think about meal time insulin. In essence I do not think there has been any sandbagging, since that would require intention, I do think there has been a certain neglect... but then again, if this is so, why MNKD's management are not pushing a bit harder in a observable way? Why they are just remaining quiet and complacent. The only indication of internal struggle is the resignation by Hakan, and even that talks more about Hakan's uneasiness to be in the position of CEO than anything else. |
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Post by dreamboatcruise on Dec 7, 2015 17:08:23 GMT -5
compound26... the question isn't whether Afrezza could ultimately become successful if the deal with SNY fell apart. The question is whether MNKD shareholders would still have any equity left at that point... at least that is the question that worries me most. Granted I'd hate to see Afrezza die as a product, but my main concern has to be my own investment.
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Post by jeremg on Dec 7, 2015 17:09:50 GMT -5
dreamboatcruise the one thing your theory doesn't take into account is Brandicourt abruptly taking over, even if those were SNY's thoughts when signing the agreement under the previous CEO (and I think this theory violates the horse = hoofbeats litmus test) things must have changed once Brandicourt took the reigns, so if SNY (and Brandicourt) knew and were sympathetic to this level of difficulty Afrezza would need to overcome (because they knew from the beginning per your theory) then why neglect Afrezza during the CCs and make it seem like such a niche third string drug? Wouldn't they want to bolster it knowing it was already facing an uphill battle with the inherent label and other difficulties?
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Post by Deleted on Dec 7, 2015 17:11:56 GMT -5
dream, I believe investors are misguided with the idea that MNKD can shift into a sales and marketing organization. To make that happen MNKD needs 500 million in cash right now. All of that expertise would need to be brought in, office space, support staff etc etc. Very expensive and well beyond MNKD's financial capabilities as is. Of course there's always al's money but I doubt he would or even could at this point put another half billion in cash into MNKD. If he did, the share count would balloon to over a billion shares on almost no revenue? It's not a pathway I see as viable. MNKD could pare a plan like that into something smaller and include a contract house to sell afrezza but given the hurdles, not sure that's a viable plan either. So, I have to just shake my head reading various sources who state that mnkd could just go it alone if SNY bails. People might want to sketch out some math on that easy-to-make statement.
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Post by mssciguy on Dec 7, 2015 17:14:30 GMT -5
compound26 ... the question isn't whether Afrezza could ultimately become successful if the deal with SNY fell apart. The question is whether MNKD shareholders would still have any equity left at that point... at least that is the question that worries me most. Granted I'd hate to see Afrezza die as a product, but my main concern has to be my own investment. Yeah the chart looks like very controlled share price destruction. Perfectly linear. Just like the refill chart. The economy is very screwed up fundamentally, a lot of prices don't make any sense, beneath the cost of production even. The Fed screwed up, they put trillions into the banks and Wall Street so now you have these 30-something brats like Karp and Shrek running around with their "creative destruction" Common sense does not apply here. Traditional economics do not apply here. I have some inheritance money (father just passed, at Al's age) coming, like hail if I let the shorts get my shares but I may be eating sardines instead of sushi for the rest of my days  May be healthier that way |
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Post by dreamboatcruise on Dec 7, 2015 17:14:41 GMT -5
jeremg... dark matter... I'm going to use a tried and true method of plugging holes in theories... there is something that we can't see that makes my theory correct. If you don't buy that one, perhaps it involves alternate universes. 
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Post by jeremg on Dec 7, 2015 17:17:42 GMT -5
dream, I believe investors are misguided with the idea that MNKD can shift into a sales and marketing organization. To make that happen MNKD needs 500 million in cash right now. All of that expertise would need to be brought in, office space, support staff etc etc. Very expensive and well beyond MNKD's financial capabilities as is. Of course there's always al's money but I doubt he would or even could at this point put another half billion in cash into MNKD. If he did, the share count would balloon to over a billion shares on almost no revenue? It's not a pathway I see as viable. MNKD could pare a plan like that into something smaller and include a contract house to sell afrezza but given the hurdles, not sure that's a viable plan either. So, I have to just shake my head reading various sources who state that mnkd could just go it alone if SNY bails. People might want to sketch out some math on that easy-to-make statement. I think we all understand what you have said and agree BUT the question stands IF SNY is "neglecting" [or "sandbagging"] Afrezza, what choice does MNKS have? Would it be preferable for them to just continue to sit on their hands and hope that SNY has a change of heart? Or would your position just be that we are stuck between a rock and a hard place - better the devil we know...? |
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Post by mssciguy on Dec 7, 2015 17:18:21 GMT -5
dreamboatcruise the one thing your theory doesn't take into account is Brandicourt abruptly taking over, even if those were SNY's thoughts when signing the agreement under the precious CEO (and I think this theory violates the horse = hoofbeats litmus test) things must have changed once Brandicourt took the reigns, so if SNY (and Brandicourt) knew and were sympathetic to this level of difficulty Afrezza would need to overcome (because they knew from the beginning per your theory) then why neglect Afrezza during the CCs and make it seem like such a niche third string drug? Wouldn't they want to bolster it knowing it was already facing an uphill battle with the inherent label and other difficulties? on the German discussion board site (you can access under the social media category) the predominant theory is that SNY just wants Afrezza for pediatric use. Pediatric use can't happen until those FDA studies are complete. So, you are talking years... and maybe, by then, SNY will take the whole company or have a technology of it's own. SO MANY moral hazards in this relationship. I don't know anything about Brandicourt except that I don't think I'd want to be his friend. |
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Post by jeremg on Dec 7, 2015 17:22:24 GMT -5
mssciguy personally I eat a can of sardines everyday (for health), luckily I also have some cheap abundant sushi in my neck of the woods though, so I can have my fish and eat it too regardless of whether WS steals all my hard earned money 
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May be healthier that way
