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Post by goyocafe on Sept 22, 2016 10:01:51 GMT -5
There are always buyers but it won't be at 70 cents. I have seen a lot of biotechs go through this kind of situation, looming delisting notice with scarce cash, and there are never any "good" buyers. The true healthcare investment funds (Orbimed, Atlas, etc.) will not touch MNKD because it is not the kind of stock they invest in. The good funds want biotechs with novel drugs, preferably first in class, that have a strong marketing partner and a clear playing field. Insulins have become a commodity and even big players like Sanofi are about to feel the pain of the PBM and managed care companies trimming their formularies. Yes, I know you will all say that Afrezza is the best rapid acting insulin and that it should not be compared to other insulins, but it is the market perception that counts and not the reality of the drug. Venture capital firms spend the time to get into details on their investments on private companies, but funds that trade public companies do not so the details aren't relevant to the investment decision.
So what you are left with is the other funds (several adjectives come to mind but this is a family friendly forum so I will refrain from using them). These guys invest to get the discounted shares and sell them quickly, usually within 20-30 days. They don't care if Mannkind sells insulin, mobile telephones, solar panels, or t-shirts; a discount is a discount and in any case they are not hanging around for more than a few weeks so why care about the product. Their primary metrics for whether they will make an investment is the size of the discount, the average daily volume of shares traded (they need somebody to buy the shares they plan to sell), and the volatility since they want an extra pop on the warrants they will demand. The level of analysis is rarely more sophisticated than that.
As for the dilution being built-in to the present price, there is some of that to be sure. When the market knows that a company will have to raise more funding the price inevitably starts to drop and when the funding actually hits there is another drop (because the new buyers want their discount from whatever the market price is as the time). The worst mistake companies make is to wait; the longer Matt goes without pulling the trigger the more the PPS will decline due to the looming dilution which will only make the share price that much lower for the new deal. Had Mannkind stepped up and done a funding when the share price was $1.00, it might have dropped the PPS to 70 cents, but by waiting the overhang and uncertainty let the price move to 70 cents anyway and now the next funding will almost certainly drop it below 50 cents. The price also takes a hit on reverse splits, and one of those is in the near future as well. None of that is a secret to the market.
Time to rip off the Band-Aid. Go ahead and man up, tell the shareholders the bad news that a reverse split is coming (personally I would do something like 1 for 20), conduct the shareholder vote to authorize it, and get back in NASDAQ compliance. Then do the funding with more like a $10 price (less discounts and warrants) and hope for the best. The balance sheet is not going to fix itself, and doing incremental steps with a stock trading under $1.00 is only going to end badly. It might end badly anyway, but at least there is a fighting chance with an investable price.
I don't see how you can expect a company to "rip off the bandaid" when apparently they are too fearful to own up to receiving an essentially meaningless delisting notice from NASDAQ. Careful, any more use of the "D" word will get this thread locked 😇 |
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Post by saxcmann on Sept 22, 2016 10:19:50 GMT -5
Would there be enough buyers for that number of shares without some empirical data that 2nd launch will be more successful than first? I think it is pure guessing game as to when and at what price dilution will occur. I just don't have that sort of feeling that enough people would have a grasp on probabilities to have anything meaningful "baked" into current price. We've held steady at levels before only to crash through them. There are always buyers but it won't be at 70 cents. I have seen a lot of biotechs go through this kind of situation, looming delisting notice with scarce cash, and there are never any "good" buyers. The true healthcare investment funds (Orbimed, Atlas, etc.) will not touch MNKD because it is not the kind of stock they invest in. The good funds want biotechs with novel drugs, preferably first in class, that have a strong marketing partner and a clear playing field. Insulins have become a commodity and even big players like Sanofi are about to feel the pain of the PBM and managed care companies trimming their formularies. Yes, I know you will all say that Afrezza is the best rapid acting insulin and that it should not be compared to other insulins, but it is the market perception that counts and not the reality of the drug. Venture capital firms spend the time to get into details on their investments on private companies, but funds that trade public companies do not so the details aren't relevant to the investment decision.
So what you are left with is the other funds (several adjectives come to mind but this is a family friendly forum so I will refrain from using them). These guys invest to get the discounted shares and sell them quickly, usually within 20-30 days. They don't care if Mannkind sells insulin, mobile telephones, solar panels, or t-shirts; a discount is a discount and in any case they are not hanging around for more than a few weeks so why care about the product. Their primary metrics for whether they will make an investment is the size of the discount, the average daily volume of shares traded (they need somebody to buy the shares they plan to sell), and the volatility since they want an extra pop on the warrants they will demand. The level of analysis is rarely more sophisticated than that.
As for the dilution being built-in to the present price, there is some of that to be sure. When the market knows that a company will have to raise more funding the price inevitably starts to drop and when the funding actually hits there is another drop (because the new buyers want their discount from whatever the market price is as the time). The worst mistake companies make is to wait; the longer Matt goes without pulling the trigger the more the PPS will decline due to the looming dilution which will only make the share price that much lower for the new deal. Had Mannkind stepped up and done a funding when the share price was $1.00, it might have dropped the PPS to 70 cents, but by waiting the overhang and uncertainty let the price move to 70 cents anyway and now the next funding will almost certainly drop it below 50 cents. The price also takes a hit on reverse splits, and one of those is in the near future as well. None of that is a secret to the market.
Time to rip off the Band-Aid. Go ahead and man up, tell the shareholders the bad news that a reverse split is coming (personally I would do something like 1 for 20), conduct the shareholder vote to authorize it, and get back in NASDAQ compliance. Then do the funding with more like a $10 price (less discounts and warrants) and hope for the best. The balance sheet is not going to fix itself, and doing incremental steps with a stock trading under $1.00 is only going to end badly. It might end badly anyway, but at least there is a fighting chance with an investable price.
Matt, honest question here. Why wouldn't Mann Foundation increase credit line $100 million rather than approve 20-1 reverse split? This would give about a year for mnkd to get scripts to increase and see if afrezza can succeed in market place. Lets say Mannkind Foundation already invested $900 million at $1 and reverse split is approved by BOD then wouldn't Mann Foundation net worth drop to $45 million? Why would they do that?? Part of Al's last wishes was give mnkd every chance to succeed so in my opinion they would rather increase credit line than R/S. |
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Post by gonetotown on Sept 22, 2016 10:28:41 GMT -5
I don't see how you can expect a company to "rip off the bandaid" when apparently they are too fearful to own up to receiving an essentially meaningless delisting notice from NASDAQ. Careful, any more use of the "D" word will get this thread locked 😇 Yeah, I noticed that but don't understand why. It was already pretty much a given, so why didn't MNKD just issue the PR and get it over with? |
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Post by mnkdnewb on Sept 22, 2016 10:32:24 GMT -5
$100,000,000 line of credit wouldn't guarantee the price would rise over $1 per share and may even dilute it further. Also, with the trustees involved now, they don't make emotional decisions like Al may have done with his namesake company. Right now the company is bleeding heavily and a trustee would potentially open himself up for a lawsuit if they piss any money away on a company with a balance sheet like MNKD.
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Post by Deleted on Sept 22, 2016 10:34:03 GMT -5
Matt, honest question here. Why wouldn't Mann Foundation increase credit line $100 million rather than approve 20-1 reverse split? This would give about a year for mnkd to get scripts to increase and see if afrezza can succeed in market place. Lets say Mannkind Foundation already invested $900 million at $1 and reverse split is approved by BOD then wouldn't Mann Foundation net worth drop to $45 million? Why would they do that?? Part of Al's last wishes was give mnkd every chance to succeed so in my opinion they would rather increase credit line than R/S. reverse split doesnt cause networth go down. Market cap remains same. reverse split followed by dilution , may get the share price down in which case the value goes down and also you get to own lesser piece of the pie cos sharing with the others. the last dilution of 100 mil shares already reduced the %age owned by Mann foundation |
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Post by Deleted on Sept 22, 2016 10:36:02 GMT -5
$100,000,000 line of credit wouldn't guarantee the price would rise over $1 per share and may even dilute it further. Also, with the trustees involved now, they don't make emotional decisions like Al may have done with his namesake company. Right now the company is bleeding heavily and a trustee would potentially open himself up for a lawsuit if they piss any money away on a company with a balance sheet like MNKD. I will say , it will cos the uncertainty is taken away and the runway is extended to 10 more months. Shorts will have to re asses their position as new investors buy in. |
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Post by slugworth008 on Sept 22, 2016 10:37:19 GMT -5
What about the RLS milestone payment? How about the $130M and $140M milestone payments from Tolero and Colby? Until there is a press release from Mannkind about receiving any dollars from RLS I would not expect a dime. Excellent point! |
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Post by audiomr on Sept 22, 2016 11:48:53 GMT -5
What about the RLS milestone payment? Its coming but first MNKD has to release their partnership with google What partnership with Google? |
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Post by Deleted on Sept 22, 2016 11:51:24 GMT -5
Its coming but first MNKD has to release their partnership with google What partnership with Google? he meant Apple. didnt you get the memo? Stay Tuned |
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Dilution?
Sept 22, 2016 11:52:28 GMT -5
via mobile
Post by saxcmann on Sept 22, 2016 11:52:28 GMT -5
$100,000,000 line of credit wouldn't guarantee the price would rise over $1 per share and may even dilute it further. Also, with the trustees involved now, they don't make emotional decisions like Al may have done with his namesake company. Right now the company is bleeding heavily and a trustee would potentially open himself up for a lawsuit if they piss any money away on a company with a balance sheet like MNKD. Never said 100 million would get pps over $1 but scripts would if more time for runway. I don't think increasing credit line by trustees is an emotional decision either. Trustee lawsuit for adding credit line if Al wanted?...lol Okay newbie! |
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Post by saxcmann on Sept 22, 2016 12:01:57 GMT -5
Matt, honest question here. Why wouldn't Mann Foundation increase credit line $100 million rather than approve 20-1 reverse split? This would give about a year for mnkd to get scripts to increase and see if afrezza can succeed in market place. Lets say Mannkind Foundation already invested $900 million at $1 and reverse split is approved by BOD then wouldn't Mann Foundation net worth drop to $45 million? Why would they do that?? Part of Al's last wishes was give mnkd every chance to succeed so in my opinion they would rather increase credit line than R/S. reverse split doesnt cause networth go down. Market cap remains same. reverse split followed by dilution , may get the share price down in which case the value goes down and also you get to own lesser piece of the pie cos sharing with the others. the last dilution of 100 mil shares already reduced the %age owned by Mann foundation Good point. Not sure what I was thinking. I guess I was thinking share price would go down again after R/S because I assumed more dilution coming. Percentage owned by Mann Foundation would be reduced again with dilution. Not sure they want this but maybe no choice. We sure need a new deal or scripts to start increasing soon. My projections have scripts jumping up in 2-3 weeks. Hope I'm right... |
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Post by op2778 on Sept 22, 2016 13:28:16 GMT -5
I'm going to say this, and i deserve as many slap as you want.
Let's suppose no Good news, no arbitration Vs SNY, no RLS milestone etc....
We already know that we are in big trouble.
Now, we know Alfred Mann spent (or invest, call it like you want) 1billion of his own capital.
What If family or The Trustee in honor of his memory (but Also looking to recoup some money) decide to do this move The same day:
Give 100mm credit to MNKD to keep commercialization plan on and The same day, without any PR or nothing like that, they Buy in The open market 100mm of shares.
I know, It's ridicolous, why they will risk 200mm when they already spent 1billion? But, imagine that scenario.
What will happen that day to SP?
Op
Note: slap accepted and deserved
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Post by kbrion77 on Sept 22, 2016 13:33:37 GMT -5
I'm going to say this, and i deserve as many slap as you want. Let's suppose no Good news, no arbitration Vs SNY, no RLS milestone etc.... We already know that we are in big trouble. Now, we know Alfred Mann spent (or invest, call it like you want) 1billion of his own capital. What If family or The Trustee in honor of his memory (but Also looking to recoup some money) decide to do this move The same day: Give 100mm credit to MNKD to keep commercialization plan on and The same day, without any PR or nothing like that, they Buy in The open market 100mm of shares. I know, It's ridicolous, why they will risk 200mm when they already spent 1billion? But, imagine that scenario. What will happen that day to SP? Op Note: slap accepted and deserved No and get ready to be slapped lol. The Trustees have a fiduciary responsibility and will not make decisions based on honoring his memory. |
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Post by nylefty on Sept 22, 2016 13:51:02 GMT -5
(snip) What If family or The Trustee in honor of his memory (but Also looking to recoup some money) decide to do this move The same day: Give 100mm credit to MNKD to keep commercialization plan on and The same day, without any PR or nothing like that, they Buy in The open market 100mm of shares. I know, It's ridicolous, why they will risk 200mm when they already spent 1billion? But, imagine that scenario. What will happen that day to SP? Op Note: slap accepted and deserved No and get ready to be slapped lol. The Trustees have a fiduciary responsibility and will not make decisions based on honoring his memory. In an interview with the New York Times several years before his death Al said that his will instructed his foundation to make sure that his companies had "enough money." Unless he later changed his will wouldn't that obligate the foundation to carry out his wishes? Mr. Mann, who survived two minor bouts of cancer but said he was now healthy, said his will instructed the foundation that is to inherit his wealth to make sure that his companies have enough money.
www.nytimes.com/2007/11/16/business/16mannkind.html |
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Post by surplusvalue on Sept 22, 2016 13:54:00 GMT -5
Would there be enough buyers for that number of shares without some empirical data that 2nd launch will be more successful than first? I think it is pure guessing game as to when and at what price dilution will occur. I just don't have that sort of feeling that enough people would have a grasp on probabilities to have anything meaningful "baked" into current price. We've held steady at levels before only to crash through them. There are always buyers but it won't be at 70 cents. I have seen a lot of biotechs go through this kind of situation, looming delisting notice with scarce cash, and there are never any "good" buyers. The true healthcare investment funds (Orbimed, Atlas, etc.) will not touch MNKD because it is not the kind of stock they invest in. The good funds want biotechs with novel drugs, preferably first in class, that have a strong marketing partner and a clear playing field. Insulins have become a commodity and even big players like Sanofi are about to feel the pain of the PBM and managed care companies trimming their formularies. Yes, I know you will all say that Afrezza is the best rapid acting insulin and that it should not be compared to other insulins, but it is the market perception that counts and not the reality of the drug. Venture capital firms spend the time to get into details on their investments on private companies, but funds that trade public companies do not so the details aren't relevant to the investment decision.
So what you are left with is the other funds (several adjectives come to mind but this is a family friendly forum so I will refrain from using them). These guys invest to get the discounted shares and sell them quickly, usually within 20-30 days. They don't care if Mannkind sells insulin, mobile telephones, solar panels, or t-shirts; a discount is a discount and in any case they are not hanging around for more than a few weeks so why care about the product. Their primary metrics for whether they will make an investment is the size of the discount, the average daily volume of shares traded (they need somebody to buy the shares they plan to sell), and the volatility since they want an extra pop on the warrants they will demand. The level of analysis is rarely more sophisticated than that.
As for the dilution being built-in to the present price, there is some of that to be sure. When the market knows that a company will have to raise more funding the price inevitably starts to drop and when the funding actually hits there is another drop (because the new buyers want their discount from whatever the market price is as the time). The worst mistake companies make is to wait; the longer Matt goes without pulling the trigger the more the PPS will decline due to the looming dilution which will only make the share price that much lower for the new deal. Had Mannkind stepped up and done a funding when the share price was $1.00, it might have dropped the PPS to 70 cents, but by waiting the overhang and uncertainty let the price move to 70 cents anyway and now the next funding will almost certainly drop it below 50 cents. The price also takes a hit on reverse splits, and one of those is in the near future as well. None of that is a secret to the market.
Time to rip off the Band-Aid. Go ahead and man up, tell the shareholders the bad news that a reverse split is coming (personally I would do something like 1 for 20), conduct the shareholder vote to authorize it, and get back in NASDAQ compliance. Then do the funding with more like a $10 price (less discounts and warrants) and hope for the best. The balance sheet is not going to fix itself, and doing incremental steps with a stock trading under $1.00 is only going to end badly. It might end badly anyway, but at least there is a fighting chance with an investable price.
All this in this thread is idle speculation but I thought we already covered the discussion of a reverse split before. I'll repeat, artificially raising the share price with a reverse split under the present conditions is not going to fool anyone precisely because MNKD is in trouble and it will appear exactly as it is..an act of desperation. You'll get the same "other funds" parasites. This strategy isnt worthy of the name and you quite correctly indicate that you'll "hope for the best" because that's all your suggestion offers, no real strategy at all, just more hope. You're entitled to your opinion but the 1 for 20 suggestion isn't even worth a response it's so ludicrous. |
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