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Post by benyiju on Feb 8, 2016 3:36:32 GMT -5
MNKD is supposed to have enough cash to operate for another 6 months. On paper that may be true, but in the real world, of course, a death spiral can start with some cash still on hand. Considering flat script numbers (and a presumably token effort by Sanofi up to handover), the Deerfield goons lurking in the background, Al being MIA, uncertain institutional support after Sanofi dumped us and we became a penny stock, a lengthening timeline for TS developments, a less than inspiring management, etc., do we need to worry about a cash crisis sooner than this summer?
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Post by sf1981 on Feb 8, 2016 4:59:50 GMT -5
Good point. My concern is that MNKD's only realistic source of cash is a parting settlement from Sanofi. Unfortunately, since they have a decent change of getting something, no other creditor/contractual party (Deerfield, Amphastar etc.) will make a concession, at least not now. They might not even be able to realize full value for the CA property on sale, as bidders know there is a chance of a MNKD fire sale coming soon.
SNY, in my view, will try to get out of having to pay a settlement and rather offer to waive the LOC debt as that is money probably already written off on their books. This doesn't help MNKD a whole lot (other than that the hefty 8% or so coupon goes away). But if that is all there is, MNKD has to take it.
This is all deeply troubling. If there were any "easy" source of cash, they would have already taken it. Situation is quite dire.
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Post by benyiju on Feb 8, 2016 5:10:52 GMT -5
We all seem sure that MNKD is due some sort of severance gift, but as you point out, even if we get one, it might not be cash on the barrel. And I suppose there is also real possibility SNY feels legally covered (and happy to add to MNKD woes) and refuses to offer anything.
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Post by benyiju on Feb 8, 2016 5:14:32 GMT -5
Tomorrow's poll will be whether or not (and how much) MNKD is likely to get parting gift from SNY! Is there strong precedent for this, or are we engaging in more wishful thinking on this point?
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Post by liane on Feb 8, 2016 5:25:08 GMT -5
FYI everyone,
There's no reason to keep a poll open for almost 3 weeks - 1 week is more than enough. Unfortunately, it doesn't appear that I can edit the timelime. In the future, if you create such a poll, I will lock it.
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Post by benyiju on Feb 8, 2016 5:43:55 GMT -5
I've only created one other poll (how long will it take to name new CEO) and in that case the discussion went on longer than a week so this time I gave poll longer run. However you're the boss, so in future will set for 1 week run max.
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Post by symbil on Feb 8, 2016 7:42:28 GMT -5
Based on the picture you paint, the poll wont need to be open 3 weeks since they'll already be bankrupt and we wont need to post on here anymore, nor create any additional polls, right?
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Post by avogadro on Feb 8, 2016 8:52:59 GMT -5
.....I suppose there is also real possibility SNY feels legally covered (and happy to add to MNKD woes) and refuses to offer anything. Is this SNY's "coup de grâce" for MNKD? |
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Post by matt on Feb 8, 2016 8:54:14 GMT -5
There are plenty of ways to stretch out the remaining cash to last longer than six months, but the problem will come when the company pops the Deerfield debt covenant on having $25 million in cash at the end of every quarter. Once that happens there is probably no going back so that event has to be avoided at all costs. If the company can run on its available cash (minus the $25 million Deerfield reserve) then it can run until March next year.
I wouldn't count on Sanofi paying anything. They worded the contract terms very carefully, phrases and legal terms of art that normal people might not notice but no competent deal lawyer would fail to notice, that pretty much gave Sanofi carte blanche to do what they did. The contract was entered into by experienced businessmen running public companies that were well-advised by their legal teams. My calculations suggest that Sanofi spent at least $400 million on Afrezza and to convince a judge that this was not "commercially reasonable" (one of those legal terms of art) will be difficult to impossible.
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Post by benh on Feb 8, 2016 10:16:43 GMT -5
$25mm at the end of each quarter. That leaves $35MM. They need $24MM / 12months for insulin.
Leaves $22MM between now and July 1st.
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Post by symbil on Feb 8, 2016 10:28:34 GMT -5
If they are still working through plans on funding MNKD through July, then we are all in trouble. Fact of the matter is, they are probably many steps ahead of that point, already.
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Post by Deleted on Feb 8, 2016 10:58:40 GMT -5
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Post by joeypotsandpans on Feb 8, 2016 11:27:56 GMT -5
According to most analysts, this drug was never going to be on the market either...if you're in the habit of listening to analysts you have an entire educational process you will need to go through. First lesson, the analysts are not there for you  As for the latter part of your statement, most analysts also said that MNKD would never have a partner in the first place. The original partner, I say original in jest meaning the original CEO that got displaced by the board because he wasn't a follower but a leader was replaced by an idiot that ultimately will be shown (IMO) to have made a huge error in judgement and possibly liable in totally disregarding properly pricing the product to effectively compete. Cannot speak for "other companies" that may see where the original so called partner failed. |
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Post by dreamboatcruise on Feb 8, 2016 14:50:57 GMT -5
Tomorrow's poll will be whether or not (and how much) MNKD is likely to get parting gift from SNY! Is there strong precedent for this, or are we engaging in more wishful thinking on this point? Prior to Matt's statement about it, I would have said pure wishful thinking. I'll take him at face value that there may be some payment... i.e. I'm thinking akin to the fact that many companies routinely offer some "severance" package in order to get laid off employees to sign releases, etc. even when the company feels they have no real legal exposure regarding the termination. I don't believe it will be a huge amount. Though ever extra month of runaway at this point is crucial. Based on what MNKD has said about SNY, I'm guessing that MNKD probably went along with most/all SNY recommendations in the JAC. |
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Post by benyiju on Feb 8, 2016 15:07:46 GMT -5
Tomorrow's poll will be whether or not (and how much) MNKD is likely to get parting gift from SNY! Is there strong precedent for this, or are we engaging in more wishful thinking on this point? Prior to Matt's statement about it, I would have said pure wishful thinking. I'll take him at face value that there may be some payment... i.e. I'm thinking akin to the fact that many companies routinely offer some "severance" package in order to get laid off employees to sign releases, etc. even when the company feels they have no real legal exposure regarding the termination. I don't believe it will be a huge amount. Though ever extra month of runaway at this point is crucial. Based on what MNKD has said about SNY, I'm guessing that MNKD probably went along with most/all SNY recommendations in the JAC. I hope you're right, but if it's true that SNY has known for some time they were going to dump Afrezza (and I think it's hard to argue with that now), I'm guessing they have been being very careful with a view to limiting their exposure to this issue. |
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