The Castagna Manifesto

[centralcoastinvestor]

Mnkdfann found this reply from Mike Castagna to the recent Looking For Diogenes article in SA.  I think this response tells us who we have working for us.  He is a fighter!  It is a thing of beauty as someone else posted.  I thought it deserved its own thread so everyone sees it.

Dear Diogenes,
Almost 70% of diabetics are not at goal, this is something we need to focus on.
As you may or may not know over 200 people with diabetes a day get amputations and ~6 people with diabetes an hour start dialysis because they haven't been able to control their blood sugars for a long time (http://tinyurl.com/zvs...).
Now that you understand we are talking about a real disease with real challenges, I would like to highlight some issues with your article:

1) When you want to compare sales rep impact, don't compare and apple to an orange. Your analysis looks at a rep who has been in a territory calling on a doctor for 9+ months and you are comparing to a time period when we didn't even have a sales force present post the ADA meeting and then attempting to make conclusions about their impact. I would suggest you see what the impact our reps have after 9 months of calling on their customers before you say they are ineffective or have an low ROI.

2) Our sales force started the first week of July, mid-year when many lunch appointments were already booked. I am very proud my team has been able to stop an almost 12 month decline in NRx in less than 4 weeks of being in the field and demonstrate growth in NRx during the month of August despite a Medicare/Medicaid challenge. Don't forget for every rep we had, Sanofi had ~7-10 reps in a territory,therefore their NRx per rep would even be less than ours and we are doing this a fraction of the cost and have been making an immediate impact. We have had almost 200 new trialists who wrote their first Afrezza Rx in the last 13 weeks and have had a significant number of sample and copay card requests via our website in the last 4 weeks. These are programs we stated were launching in August and most have only landed in our sales reps hands in the last 3 weeks.

3) I joined MannKind <5 months ago and I would ask you to find a company or team who launched a fully integrated commercial team, built distribution capabilities, managed a smooth inventory transition across 80 distribution centers with new NDCs and built a new marketing campaign along with all the field tools to go with a launch in <90 days. This has to be a record for any company in this industry. I have been doing this a long time and companies spend tens of millions of dollars, a lot more people and 12+ months of planning.

4) While ADA was important for us to meet thought leaders, build international relationships and showcase our new data, this was the foundation of information that is required for us to file for a label change. This is not information our field team can use immediately, so I wouldn't expect an impact from this. I wish more doctors had time to read and review our publications as well as the ADA data as they would then understand our brand and likely prescribe it for even more patients.

5) Please note the significant number of NRx that were previously generated in 2015 rarely converted to refills week after week. Our focus is on making sure patients start appropriately and stay on our product. The strategy between MannKind and Sanofi are completely different and while I understand generating NRx's are important, it is more important we keep patients on our product once we get them and that is a big focus of ours. Everyone understands the beauty of compounding growth versus single hits.

Finally, regarding what Matt may or may not have said about the payor space is in the past. We have deep expertise in this area and are focused on removing barriers for patients to get access to our product. Afrezza has not had a price increase in 2 years, but many insurance companies still penalize patients by putting us on a higher copay/tier despite us holding the price of this product. We know the payor space well and unfortunately these things take time to make changes and I am confident we will share our value proposition with our payor colleagues and enhance access to Afrezza. However, at the current time we have created a reimbursement center to help patients get access to our product as efficiently as possible. It should also be noted that we have significant coverage for commercial plans, but Medicare is a challenge which is ironic because these are government insured patients/voters and the price increases in the insulin market are being paid for by all of us as taxpayers given this is the #1 expense category for payors and healthplans. We should be demanding Medicare open up access for Afrezza so that we can give patients another option that can help them control their disease.

In the future, I hope you find time to write about why insurance companies and Medicare plans are restricting patients access to a product that hasn't taken price increase and in effect are driving up patients out of pocket costs as well as our tax bills and how this prevents patients from getting access to our brand as they attempt to get their disease under control.

I joined this company because I know we will help patients and we serve an unmet need every single day. I get story after story of how our product changed the life of a person living with the disease, a spouse who got their husband back or parent who has more comfort that their college kid can control their disease without having their insulin pump attached to them. I recognize the financial situation of the company and the job of good leaders is to make the right short and long term decisions to grow and sustain. If anyone reacts to 1 week of NRx they are short sighted. This company has survived many doom and gloom reports all the way back to 2005. We finally have our brand FDA approved, in our hands and we will ensure we make Al Mann's vision a reality.

[rockstarrick]

Wow, great response Mike C
Thanks to you and your team for all the hard work.

[kc]

Most importantly he was very articulate as he has to make sure of what words he uses since its a public form. Mike is a consummate professional. While we are not happy with our current hand that we have regarding current sales we know that hopefully we will see the tide turn shortly.   I am sure that MannKind / Board of directors have some alternate plans for righting the ship  and cash flow.  

[myocat]

Could you re post the link?

[rockstarrick]

Aug 30, 2016 10:20:33 GMT -5 myocat said:

Could you re post the link?

seekingalpha.com/article/4002856-mannkind-curtain-drawn-microphone-place

[gamblerjag]

KC.  agreed. His response where perhaps not the norm, it's not really that different than a CEO or CFO or COO going on CNBC or fox news business promoting or negating incorrect information.  It's all to get the word out.  Mike didn't mention that this "high school hit pieces"  "unprofessional Journalism"  or any other clichés to escalate tensions.  He spoke of the facts, no sob story and I'm glad he responded the way he did.  Yes Matt, probably wouldn't have done that because Matt is more reserved but if some remember, Matt has addressed share price after continued hit pieces came out about 18 months ago.  Thanks Mike C.

[avichen]

he is aggressive, young, full of spirit. Will he be the next super star in biz world? or the next pharma bro? I'll give him more time to prove what he's made of.

[ilovekauai]

You go Michael C!! I'm with you all the way! Aloha,

[liane]

I think this message is so important that I'm pinning it to the top of the forum for a while. Way to go Mike! You spoke succinctly and appropriately to the reason for Afrezza's existence.

[op2778]

I'm agree with Castagna. They know The financial situation of The company, but, he is working very hard. Kudos to him. I added when he did, and will add again If necessary. Probably in this moment, The best thing to do is to play option lottery and buy cheap 2018 calls. Gltu

[mnkdnewbie]

I bought 1,500 more shares at .69 after I read this, it was the fastest mnkd order I've ever had executed in the 2years I've been accumulating.

[cjc04]

Wow, very motivating and inspirational!

[prvs]

LFD has a habit of ripping apart anyone who disagrees with him. He usually uses insults and mockery. If he does that to Mike C. what will happen? Will he dare? Mike could sue him for libel. This should be interesting.

[dg1111]

I have mixed feelings on Mike posting in the comments section of Seekingalpha, but I certainly prefer this to the veil of secrecy that we had before him.

Mike has certainly gone all-in here. He left a very good job with a big company. He has also put over $100k of his own money (about $80k in the last 2 weeks) into stock purchases. He is convinced that he can turn this around. I hope he's right.

[slugworth008]

Aug 30, 2016 9:52:44 GMT -5 centralcoastinvestor said:

Mnkdfann found this reply from Mike Castagna to the recent Looking For Diogenes article in SA.  I think this response tells us who we have working for us.  He is a fighter!  It is a thing of beauty as someone else posted.  I thought it deserved its own thread so everyone sees it.

Dear Diogenes,
Almost 70% of diabetics are not at goal, this is something we need to focus on.
As you may or may not know over 200 people with diabetes a day get amputations and ~6 people with diabetes an hour start dialysis because they haven't been able to control their blood sugars for a long time (http://tinyurl.com/zvs...).
Now that you understand we are talking about a real disease with real challenges, I would like to highlight some issues with your article:

1) When you want to compare sales rep impact, don't compare and apple to an orange. Your analysis looks at a rep who has been in a territory calling on a doctor for 9+ months and you are comparing to a time period when we didn't even have a sales force present post the ADA meeting and then attempting to make conclusions about their impact. I would suggest you see what the impact our reps have after 9 months of calling on their customers before you say they are ineffective or have an low ROI.

2) Our sales force started the first week of July, mid-year when many lunch appointments were already booked. I am very proud my team has been able to stop an almost 12 month decline in NRx in less than 4 weeks of being in the field and demonstrate growth in NRx during the month of August despite a Medicare/Medicaid challenge. Don't forget for every rep we had, Sanofi had ~7-10 reps in a territory,therefore their NRx per rep would even be less than ours and we are doing this a fraction of the cost and have been making an immediate impact. We have had almost 200 new trialists who wrote their first Afrezza Rx in the last 13 weeks and have had a significant number of sample and copay card requests via our website in the last 4 weeks. These are programs we stated were launching in August and most have only landed in our sales reps hands in the last 3 weeks.

3) I joined MannKind <5 months ago and I would ask you to find a company or team who launched a fully integrated commercial team, built distribution capabilities, managed a smooth inventory transition across 80 distribution centers with new NDCs and built a new marketing campaign along with all the field tools to go with a launch in <90 days. This has to be a record for any company in this industry. I have been doing this a long time and companies spend tens of millions of dollars, a lot more people and 12+ months of planning.

4) While ADA was important for us to meet thought leaders, build international relationships and showcase our new data, this was the foundation of information that is required for us to file for a label change. This is not information our field team can use immediately, so I wouldn't expect an impact from this. I wish more doctors had time to read and review our publications as well as the ADA data as they would then understand our brand and likely prescribe it for even more patients.

5) Please note the significant number of NRx that were previously generated in 2015 rarely converted to refills week after week. Our focus is on making sure patients start appropriately and stay on our product. The strategy between MannKind and Sanofi are completely different and while I understand generating NRx's are important, it is more important we keep patients on our product once we get them and that is a big focus of ours. Everyone understands the beauty of compounding growth versus single hits.

Finally, regarding what Matt may or may not have said about the payor space is in the past. We have deep expertise in this area and are focused on removing barriers for patients to get access to our product. Afrezza has not had a price increase in 2 years, but many insurance companies still penalize patients by putting us on a higher copay/tier despite us holding the price of this product. We know the payor space well and unfortunately these things take time to make changes and I am confident we will share our value proposition with our payor colleagues and enhance access to Afrezza. However, at the current time we have created a reimbursement center to help patients get access to our product as efficiently as possible. It should also be noted that we have significant coverage for commercial plans, but Medicare is a challenge which is ironic because these are government insured patients/voters and the price increases in the insulin market are being paid for by all of us as taxpayers given this is the #1 expense category for payors and healthplans. We should be demanding Medicare open up access for Afrezza so that we can give patients another option that can help them control their disease.

In the future, I hope you find time to write about why insurance companies and Medicare plans are restricting patients access to a product that hasn't taken price increase and in effect are driving up patients out of pocket costs as well as our tax bills and how this prevents patients from getting access to our brand as they attempt to get their disease under control.

I joined this company because I know we will help patients and we serve an unmet need every single day. I get story after story of how our product changed the life of a person living with the disease, a spouse who got their husband back or parent who has more comfort that their college kid can control their disease without having their insulin pump attached to them. I recognize the financial situation of the company and the job of good leaders is to make the right short and long term decisions to grow and sustain. If anyone reacts to 1 week of NRx they are short sighted. This company has survived many doom and gloom reports all the way back to 2005. We finally have our brand FDA approved, in our hands and we will ensure we make Al Mann's vision a reality.

  I saw this on stocktwits this morning CCI - Fantastic response from Mike C!!! - Thanks for posting this here