Nates New notes on MNKD
Jul 29, 2016 11:48:14 GMT -5
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mannmade, agusta, and 20 more like this
Post by sportsrancho on Jul 29, 2016 11:48:14 GMT -5
And now on to some of the most frequently asked questions regarding MannKind…
Q. When do you think we’ll start to see in increase in prescriptions for Afrezza?
A. The rollout of Afrezza 2.0 is just now getting underway, and though it is true that educators and sales reps are already starting to visit doctors and clinics, I think it is important to keep in mind that the first call (or even two!) at each location will most likely be almost entirely for the purpose of introducing the product and leaving educational materials. Once the doctors have become familiarized with the product (and, keep in mind, that MannKind is attempting to focus mainly on doctors who are already somewhat familiar with the product, so this shouldn’t be large of a hurdle), the next step will be for them to start patients on the trial (sample) packs that you’ve probably heard MannKind talking about, and, in most cases, these sample packs (which will not show up as “prescriptions”) will last roughly 30 days. After this trial period has ended (and assuming the patient has decided to continue with Afrezza), then doctors will start to write actual prescriptions that will show up in the weekly reports… and so, putting all of this together, I think the earliest we can/should be expecting to see a meaningful uptick in prescriptions will be late August or early September (though I’ll bet you dollars to doughnuts that our friends on the short side will spend a great deal of time lamenting “the low prescription rate” every week that goes by between now and then!).
Q. What happens if Afrezza 2.0 doesn’t go as planned?
A. If MannKind is unable to generate some traction for Afrezza between now and the end of the year, it will almost certainly mean the end of the company as we know it – the question, of course, is whether Al Mann’s heirs (who control the foundations that, in turn, control roughly one-third of the stock) will be willing to sell the company at a steep discount to what they thought it would be worth… or if there will prove to be some advantage to allowing it to slip into bankruptcy.
That being said, while I remain optimistic about Afrezza’s chances for success (and have put not only the newsletter’s reputation but a significant portion of my own money on the line as well to back-up this viewpoint), based on some of the emails I have received, I feel compelled to put the following in bold and italics for you: If I am wrong about Afrezza, the stock will likely end up trading much lower than where it is now by the time all the dust settles… and, consequently, I really do mean it when I say “do not own more than you can a) comfortably sleep with at night, and b) afford to lose if it turns out I am wrong (which is always a possibility!).”
Yes, as stated before, given the way things have unfolded over the past 18 months (an apparent lack of effort by Sanofi, a concerted effort by short sellers to drive the price down, etc.), I believe the fact that the stock has traded down to $1 (and the company sports a market cap nearly identical to the one it had when it came public with an unproven product that still had not even passed clinical trials) means that investors are looking at the sort of investment opportunity that only comes along once or twice in most investors lifetimes… but we’re not out of the woods yet!
Q. Out of everything I read on the internet, you seem to be the only one who thinks Afrezza is going to amount to much – what makes you so optimistic, Nate?
A. Though my experiences do not guarantee that Afrezza will be a success, having grown up with a father who was both a Type-1 diabetic and a family practice doctor (now retired), as well as having a great-grandmother who was a diabetic, I can tell you with a high degree of confidence that the benefits that Afrezza provides absolutely represent a significant step forward in terms of helping diabetics manage their “illness”… especially when one realizes that the huge improvements that Afrezza brings on the insulin formulation side can be dramatically leveraged by pairing them with the technology that is being developed in the world of “continuous glucose monitors” these days (and, if history is any guide, is only going to get cheaper, less intrusive, and more reliable as time goes by). No, Afrezza does not yet have a label that says “ultra-rapid acting” versus “rapid acting” (as is found on the majority of today’s mealtime insulins)… but the data and the anecdotal evidence is there to support the idea that “real-time blood sugar monitoring calls for real-time insulin (and Afrezza is the only insulin that fits this bill).”
In addition, regardless of whether it is on the label yet or not, the fact that Afrezza appears to leave the bloodstream faster than other insulins suggests that it will provide the added benefit of reducing the worry about “stacking” insulin in the body and having to worry about hypoglycemia (low blood sugar), which is a far more serious problem for (and therefore represents a “fear”) for diabetics than high blood sugar (which, at moderate levels, represents more of a long-term – but very real – health risk than hypoglycemia, which can be life threatening).
As I’ve stated before, history suggests that the shift to a “next generation” insulin will take longer than the optimists are hoping… but, at some point, critical mass will be reached, and, all of a sudden, everyone will switch to the new “technology” and start to wax poetics about “how we used to have to manage diabetes before ___ came along.”
Q. Why is Sanofi still involved with Afrezza?
A. To be honest, the entire manner in which Sanofi terminated its agreement with MannKind has been puzzling since it was first announced, and I can’t tell you what is going on behind the scenes. As you know, I found it odd that Sanofi invoked not one, but two, clauses as part of its right to terminate the agreement, and though the first appears to have resulted in a clear change in the story line at the 90-day mark when all rights to Afrezza were returned to MannKind, there has not been any news at the 180-day mark (July 4th)… which leads us to the next question.
Q. What’s up with “the insulin put”… and will MannKind be getting any extra money from Sanofi as part of a final settlement?
As I mentioned awhile back, one of the clauses of the agreement with Sanofi allowed for MannKind to “put” (force Sanofi to buy) up to $50 million worth of insulin if Sanofi terminates the agreement, and, as many of you have pointed out, we have not heard anything from MannKind yet about how this turned out… which, in turn, has caused many of you to wonder whether there might be “bigger discussions” taking place.
To be honest, your guess is as good as mine – on the one hand, there are reasons to think MannKind will be lucky to “put” a few million dollars worth of insulin to Sanofi, but there are also reasons to believe MannKind might end up with a significantly larger “termination check” from Sanofi, especially if presumed negotiations drag out long enough for MannKind’s sales force to outsell Sanofi’s “right out of the gate.” It might not happen until the next earnings call, but I am hopeful management will announce a final termination as soon as they are able to.
Q. Why did Mike Castagna present at the Cantor Fitzgerald conference this week when Matt Pfeffer was listed as the speaker?
A. Again, your guess is as good as mine, but between wrapping things up with Sanofi and possibly signing new international partners (which might be contingent on Mannkind “being done with Sanofi” first), I can think of a lot of reasons Pfeffer might have been elsewhere at the last minute… in my mind, the only people this was an issue for were people who want there to be “issues” for investors to be worried about.
Q. When do you think we’ll start to see in increase in prescriptions for Afrezza?
A. The rollout of Afrezza 2.0 is just now getting underway, and though it is true that educators and sales reps are already starting to visit doctors and clinics, I think it is important to keep in mind that the first call (or even two!) at each location will most likely be almost entirely for the purpose of introducing the product and leaving educational materials. Once the doctors have become familiarized with the product (and, keep in mind, that MannKind is attempting to focus mainly on doctors who are already somewhat familiar with the product, so this shouldn’t be large of a hurdle), the next step will be for them to start patients on the trial (sample) packs that you’ve probably heard MannKind talking about, and, in most cases, these sample packs (which will not show up as “prescriptions”) will last roughly 30 days. After this trial period has ended (and assuming the patient has decided to continue with Afrezza), then doctors will start to write actual prescriptions that will show up in the weekly reports… and so, putting all of this together, I think the earliest we can/should be expecting to see a meaningful uptick in prescriptions will be late August or early September (though I’ll bet you dollars to doughnuts that our friends on the short side will spend a great deal of time lamenting “the low prescription rate” every week that goes by between now and then!).
Q. What happens if Afrezza 2.0 doesn’t go as planned?
A. If MannKind is unable to generate some traction for Afrezza between now and the end of the year, it will almost certainly mean the end of the company as we know it – the question, of course, is whether Al Mann’s heirs (who control the foundations that, in turn, control roughly one-third of the stock) will be willing to sell the company at a steep discount to what they thought it would be worth… or if there will prove to be some advantage to allowing it to slip into bankruptcy.
That being said, while I remain optimistic about Afrezza’s chances for success (and have put not only the newsletter’s reputation but a significant portion of my own money on the line as well to back-up this viewpoint), based on some of the emails I have received, I feel compelled to put the following in bold and italics for you: If I am wrong about Afrezza, the stock will likely end up trading much lower than where it is now by the time all the dust settles… and, consequently, I really do mean it when I say “do not own more than you can a) comfortably sleep with at night, and b) afford to lose if it turns out I am wrong (which is always a possibility!).”
Yes, as stated before, given the way things have unfolded over the past 18 months (an apparent lack of effort by Sanofi, a concerted effort by short sellers to drive the price down, etc.), I believe the fact that the stock has traded down to $1 (and the company sports a market cap nearly identical to the one it had when it came public with an unproven product that still had not even passed clinical trials) means that investors are looking at the sort of investment opportunity that only comes along once or twice in most investors lifetimes… but we’re not out of the woods yet!
Q. Out of everything I read on the internet, you seem to be the only one who thinks Afrezza is going to amount to much – what makes you so optimistic, Nate?
A. Though my experiences do not guarantee that Afrezza will be a success, having grown up with a father who was both a Type-1 diabetic and a family practice doctor (now retired), as well as having a great-grandmother who was a diabetic, I can tell you with a high degree of confidence that the benefits that Afrezza provides absolutely represent a significant step forward in terms of helping diabetics manage their “illness”… especially when one realizes that the huge improvements that Afrezza brings on the insulin formulation side can be dramatically leveraged by pairing them with the technology that is being developed in the world of “continuous glucose monitors” these days (and, if history is any guide, is only going to get cheaper, less intrusive, and more reliable as time goes by). No, Afrezza does not yet have a label that says “ultra-rapid acting” versus “rapid acting” (as is found on the majority of today’s mealtime insulins)… but the data and the anecdotal evidence is there to support the idea that “real-time blood sugar monitoring calls for real-time insulin (and Afrezza is the only insulin that fits this bill).”
In addition, regardless of whether it is on the label yet or not, the fact that Afrezza appears to leave the bloodstream faster than other insulins suggests that it will provide the added benefit of reducing the worry about “stacking” insulin in the body and having to worry about hypoglycemia (low blood sugar), which is a far more serious problem for (and therefore represents a “fear”) for diabetics than high blood sugar (which, at moderate levels, represents more of a long-term – but very real – health risk than hypoglycemia, which can be life threatening).
As I’ve stated before, history suggests that the shift to a “next generation” insulin will take longer than the optimists are hoping… but, at some point, critical mass will be reached, and, all of a sudden, everyone will switch to the new “technology” and start to wax poetics about “how we used to have to manage diabetes before ___ came along.”
Q. Why is Sanofi still involved with Afrezza?
A. To be honest, the entire manner in which Sanofi terminated its agreement with MannKind has been puzzling since it was first announced, and I can’t tell you what is going on behind the scenes. As you know, I found it odd that Sanofi invoked not one, but two, clauses as part of its right to terminate the agreement, and though the first appears to have resulted in a clear change in the story line at the 90-day mark when all rights to Afrezza were returned to MannKind, there has not been any news at the 180-day mark (July 4th)… which leads us to the next question.
Q. What’s up with “the insulin put”… and will MannKind be getting any extra money from Sanofi as part of a final settlement?
As I mentioned awhile back, one of the clauses of the agreement with Sanofi allowed for MannKind to “put” (force Sanofi to buy) up to $50 million worth of insulin if Sanofi terminates the agreement, and, as many of you have pointed out, we have not heard anything from MannKind yet about how this turned out… which, in turn, has caused many of you to wonder whether there might be “bigger discussions” taking place.
To be honest, your guess is as good as mine – on the one hand, there are reasons to think MannKind will be lucky to “put” a few million dollars worth of insulin to Sanofi, but there are also reasons to believe MannKind might end up with a significantly larger “termination check” from Sanofi, especially if presumed negotiations drag out long enough for MannKind’s sales force to outsell Sanofi’s “right out of the gate.” It might not happen until the next earnings call, but I am hopeful management will announce a final termination as soon as they are able to.
Q. Why did Mike Castagna present at the Cantor Fitzgerald conference this week when Matt Pfeffer was listed as the speaker?
A. Again, your guess is as good as mine, but between wrapping things up with Sanofi and possibly signing new international partners (which might be contingent on Mannkind “being done with Sanofi” first), I can think of a lot of reasons Pfeffer might have been elsewhere at the last minute… in my mind, the only people this was an issue for were people who want there to be “issues” for investors to be worried about.
