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Post by mnholdem on Oct 31, 2016 7:56:22 GMT -5
I think the OP is implying that (or at least questioning whether) those who currently control the Mann fortune, including his hundreds of millions of shares of MNKD stock, will inject additional cash into MannKind Corporation in order to protect their holdings. There may be some truth to this, and a 2013 interview (which I posted recently) Al Mann was quoted that he would be leaving contingencies in his will to protect his companies. Detailed information of Mann's will is not public, nor is MannKind Corporation obligated to report anything unless and until the company actually receives cash as the beneficiary of a Mann Trust.
Claude Mann (wife of the deceased Alfred Mann) spoke with the new Sales & Marketing Team at one of their training sessions, which leaves me to believe that she has a vested interest in MannKind Corporation remaining viable until Afrezza and/or other pipeline drugs can support the company that her husband founded.
With the exception of Al Mann's remarks in the interview, everything else I wrote here is speculative. I think that it may come down to whether Claude wants her husband's vision to come to fruition.
NOTE: Claude was born in a concentration camp during World War II because her father, a diplomat - who was active in the French Resistance - and her mother had been imprisoned for hiding Jews from Nazi soldiers.
Claude may be the key, but much remains unknown about the relationship between those who inherited the late Al Mann's stock and the company he founded on the belief that Technosphere pulmonary delivery would change medicine as we know it, beginning with Afrezza. I agree with sportsrancho in her assertion, posted recently, that this management team is not behaving as if MannKind were on the verge of bankruptcy. Why it that?
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Post by silentknight on Oct 31, 2016 8:46:29 GMT -5
I think the Mann Foundation is in the same position all of us are in. That is, do you think that the company simply needs more time to see profitability or do you think the obstacles to successful marketing penetration and sales are too high to overcome? We all are in that same position, which determines whether or not to invest further or sell and move on. The stakes are much higher for the Mann Foundation, but they very well could decide that accepting BK is better than throwing millions more into what they could see is a failed venture. They also could loan more. We just don't know.
Mr. Mann may very well have left instructions to provide further financing to MNKD. Perhaps they didn't. We also don't know who the executor of his estate is. It could be his wife, or it could be trustees in the Mann Foundation or other unidentified individuals. Absent specific instructions in his will, his executor will likely be the deciding factor in determining what, if any, additional financing is afforded to MNKD. That could go either way.
The Mann Foundation likely has access to much more information that we do as retail shareholders, but based on what I've seen, I'd certainly be reluctant to pour more money into MNKD which is why I'm not buying anymore. I've averaged down over the past year and each time I do, I only lose more. Take my losses and then compare to the Mann Foundation's. That has to be painful to think about.
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Post by Deleted on Oct 31, 2016 9:19:51 GMT -5
I think the Mann Foundation is in the same position all of us are in. That is, do you think that the company simply needs more time to see profitability or do you think the obstacles to successful marketing penetration and sales are too high to overcome? We all are in that same position, which determines whether or not to invest further or sell and move on. The stakes are much higher for the Mann Foundation, but they very well could decide that accepting BK is better than throwing millions more into what they could see is a failed venture. They also could loan more. We just don't know. Mr. Mann may very well have left instructions to provide further financing to MNKD. Perhaps they didn't. We also don't know who the executor of his estate is. It could be his wife, or it could be trustees in the Mann Foundation or other unidentified individuals. Absent specific instructions in his will, his executor will likely be the deciding factor in determining what, if any, additional financing is afforded to MNKD. That could go either way. The Mann Foundation likely has access to much more information that we do as retail shareholders, but based on what I've seen, I'd certainly be reluctant to pour more money into MNKD which is why I'm not buying anymore. I've averaged down over the past year and each time I do, I only lose more. Take my losses and then compare to the Mann Foundation's. That has to be painful to think about. by now , most of us underestimated the penetration including the management. Some of the options could be get the epihale out into the fda pipeline , provide some funding backed by royalty of the epihale until Afrezza revenue picks up? Its not that Afrezza is not working in real world...so why back out in the last step? invested a billion $ and not give another $100 million credit line that could take the fears of and bump the share price ( ie if they have the $100 mil ? - 100 mil $ question )
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Post by silentknight on Oct 31, 2016 12:00:12 GMT -5
I think the Epihale avenue might have merits but I think a pharma partner will probably wait until FDA approval before signing on to it. Afrezza's label has been a big deterrent to sales in my opinion, so who's to say that an epi application wouldn't have a similar black box warning or carry the same issues that Afrezza's label wouldn't? I know you can't compare one drug to another but the delivery mechanism is the same; Technosphere. MNKD needs to play a much more active role in the trial design for their epi candidate if they expect to overcome much of the headwinds Afrezza's label has faced.
For the Mann Foundation, if you're sitting on hundreds of millions in losses, would you really be so inclined to devote another $100 million to MNKD when they haven't so far provided reason to believe that the money will result in a positive return on your investment? Perhaps they will, and perhaps Al instructed them to do so. If he didn't, I think it would be a pretty hard sell at the current state of affairs for anyone to convince an unbiased investor (or trustee of an estate or foundation) that more money in MNKD is well spent. There are a lot of people who, with the benefit of hindsight, might reconsider their initial investment, let alone yet another multi million dollar infusion of cash.
I don't expect the Mann Foundation to lend more money. I do expect a R/S and dilution. The clock on the Nasdaq compliance issue is ticking. Even with financing, I don't think we'd be pushed over $1.00 with the tepid sales numbers we're seeing. A R/S is likely the only way we get back into compliance before the end of the window.
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Post by mnholdem on Oct 31, 2016 12:15:51 GMT -5
I think this subject has been addressed before that Epinephrine, used in emergencies, is less susceptible to black box warnings than an API which must be inhaled multiple times daily. I agree with you, however, that MannKind cannot afford to be complacent in the design of its protocols. That's one of the reasons why they hired Raymond Urbanski as Chief Medical Officer. Regarding a partner, many big pharmas sign deals prior to FDA-approval to provide financial assistance through the development phases. Epinephrine-TS offers one of the cheapest development pathways available, since both the API and the delivery mechanism (Technosphere) have already been approved by the FDA. As Dr. Urbanski mentioned at a conference earlier in the year, the FDA consider inducing anaphylactic shock on patients in a Phase 3 trial to be unethical. Approval will be based primarily on the Phase 1/2 safety data. As I said, Epinephrine is already an FDA-approved API, so the FDA would focus more on data related to manufacturing and distribution (i.e. shelf life). Hopefully somebody stays on the ball to make sure that the FDA doesn't require refrigeration this time. That was a big slip up with Afrezza, IMHO.
Obtaining rights to Epi-TS in exchange for upfront payment, development costs and a modest royalty deal could be a bargain for the right partner.
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Post by esstan2001 on Oct 31, 2016 12:20:31 GMT -5
I think the Epihale avenue might have merits but I think a pharma partner will probably wait until FDA approval before signing on to it. Afrezza's label has been a big deterrent to sales in my opinion, so who's to say that an epi application wouldn't have a similar black box warning or carry the same issues that Afrezza's label wouldn't? I know you can't compare one drug to another but the delivery mechanism is the same; Technosphere. MNKD needs to play a much more active role in the trial design for their epi candidate if they expect to overcome much of the headwinds Afrezza's label has faced. ... The FDA respiratory bar for a rescue inhalation med that gets one time or occasional use is far different than a mutli times per day med for a chronic condition. I do not think Pharma will see the need for FDA approval, just clear evidence from data that it is safe and it works.
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Post by mannmade on Oct 31, 2016 12:20:46 GMT -5
As I have mentioned before in one of my personally more speculative posts (representing my opinion only) There is a chance that any new financing arrangements will involve multiple sources, not just a all encompassing dilution deal, although dilution may be a part of it. Another part of the source might be a deal for partnership on epihale as follows:
Say 1.) $20m upfront and 2.) $30m in a loan against future royalties.
Just my purely speculative thoughts as I have no idea whatsoever what will happen. However, I do believe that MannKind will find a way to survive at least another 12 months.
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Post by silentknight on Oct 31, 2016 12:54:33 GMT -5
I think the Epihale avenue might have merits but I think a pharma partner will probably wait until FDA approval before signing on to it. Afrezza's label has been a big deterrent to sales in my opinion, so who's to say that an epi application wouldn't have a similar black box warning or carry the same issues that Afrezza's label wouldn't? I know you can't compare one drug to another but the delivery mechanism is the same; Technosphere. MNKD needs to play a much more active role in the trial design for their epi candidate if they expect to overcome much of the headwinds Afrezza's label has faced. ... The FDA respiratory bar for a rescue inhalation med that gets one time or occasional use is far different than a mutli times per day med for a chronic condition. I do not think Pharma will see the need for FDA approval, just clear evidence from data that it is safe and it works. Good point and I agree. With the luck MNKD has had with their FDA interactions, (2 CRLs and a black box warning), it seems they can't even catch a break there. Let's hope they don't use past TS applications as a future indicator. I certainly hope someone sees potential as a reason to partner. The past 18 months of the Afrezza experience with both SNY and MNKD hasn't been the best showing for the power of TS. The wonders of science simply isn't enough in the commercial world.
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Post by tingtongtung on Oct 31, 2016 14:10:33 GMT -5
I sincerely hope MNKD doesn't go bankrupt..
But, if they have to file bankruptcy, will it be 11 or 7? Correct me if I'm wrong. In chap 11, some (all?) of teh debt is forgiven, and they can come up with a reorg plan with financing. But, who will finance? Wont they lose both Danbury and Valencia? As it is, many Drs are saying incorrectly that MNKD is going out of business. If MNKD does go bankrupt, it would be fair to say that the chances of coming back are close to 0. Every thing will be on fire sale, and some pharma company (Chinese?) will buy them for pennies on dollar.
If Deerfield goes for Danbury, and Sanofi goes for Valencia, in any bankruptcy, what's the difference between 7 and 11? Just the patents?
Wouldn't it make business sense for Mann foundation to spend another 100 million and see if they can recover more than a billion that was sunk in here? Or, is it already been written off against other profits? (I have no idea if they can do that).
Even with RS and dilution, someone has to finance new money. Who will do that, and with what kind of restrictions?
To be practical, MNKD needs at least 12 months ==> ~100 - 120 million to have a fair chance at succeeding. They have done all the legwork with 2.0, and trying to get some traction. Would it be too early to call it a day?
I'm just asking questions. I know I'm just a speck of dust in the grand scheme of things, and I'm not coming with lots of attitude :-) Just trying to get some information to see what can be done with my investment..
Thanks!
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Post by liane on Oct 31, 2016 16:46:16 GMT -5
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Post by derek2 on Oct 31, 2016 16:49:21 GMT -5
I sincerely hope MNKD doesn't go bankrupt.. But, if they have to file bankruptcy, will it be 11 or 7? Correct me if I'm wrong. In chap 11, some (all?) of teh debt is forgiven, and they can come up with a reorg plan with financing. But, who will finance? Wont they lose both Danbury and Valencia? As it is, many Drs are saying incorrectly that MNKD is going out of business. If MNKD does go bankrupt, it would be fair to say that the chances of coming back are close to 0. Every thing will be on fire sale, and some pharma company (Chinese?) will buy them for pennies on dollar. If Deerfield goes for Danbury, and Sanofi goes for Valencia, in any bankruptcy, what's the difference between 7 and 11? Just the patents? Wouldn't it make business sense for Mann foundation to spend another 100 million and see if they can recover more than a billion that was sunk in here? Or, is it already been written off against other profits? (I have no idea if they can do that). Even with RS and dilution, someone has to finance new money. Who will do that, and with what kind of restrictions? To be practical, MNKD needs at least 12 months ==> ~100 - 120 million to have a fair chance at succeeding. They have done all the legwork with 2.0, and trying to get some traction. Would it be too early to call it a day? I'm just asking questions. I know I'm just a speck of dust in the grand scheme of things, and I'm not coming with lots of attitude :-) Just trying to get some information to see what can be done with my investment.. Thanks! Add on what would be needed to do a _real_ marketing campaign. $10M per month just keeps the lights on and keeps paying Hakan $400K or so per month and Diane Palumbo $120K per month for doing nothing . What's needed? (everyone's said all of this already) 1. A serious label change re: speed of action, hypo risk, lose the black box 2. Expanded insurer coverage (not likely without label change, so that's why label should have been priority 1 all along) 3. Expanded sales force 4. DTC campaign including true mass media including benefit statements that mean something to consumers (not this inside baseball outsulin stuff). Again, driven by label improvement. We're probably talking $200M - 250M to actually do this. The $10M monthly burn and then as much again for commercialization.
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Post by matt on Oct 31, 2016 16:51:31 GMT -5
I sincerely hope MNKD doesn't go bankrupt.. But, if they have to file bankruptcy, will it be 11 or 7? Correct me if I'm wrong. In chap 11, some (all?) of teh debt is forgiven, and they can come up with a reorg plan with financing. But, who will finance? Wont they lose both Danbury and Valencia? As it is, many Drs are saying incorrectly that MNKD is going out of business. If MNKD does go bankrupt, it would be fair to say that the chances of coming back are close to 0. Every thing will be on fire sale, and some pharma company (Chinese?) will buy them for pennies on dollar.
Chapter 7 is very easy. The company closes the doors, everything is auctioned off, and creditors are paid out of the auction fund according to their legal priority. Danbury will go to Deerfield Partners and Valencia will go to Sanofi under their respective UCC security agreements, and they become unsecured creditors for any deficiency (difference between the loan and value they get for the property). Creditors are paid pro rata according to their legal priorities; any remaining debt is discharged. The company dies.
Chapter 11 is way more complicated. The company continues to run, if it can, and the creditors battle it out in court. All cash in the company is collateral for creditor claims and cannot be spent without a court order. If the company spends money on salaries, that reduces the cash to pay creditors so the creditors have a right to object. The company will be in default to both Deerfield and Sanofi, and both the parties can make a motion to the court to take possession of their security for the purposes of auctioning it off, but the court would have to approve that motion. Valencia is no big deal, MNKD can rent a different office, but if Danbury goes the company is essentially out of business. So if Deerfield moves against their security the court will have to decide if MNKD has any chance of surviving long enough to file a reorg plan that the court can approve. The hurdle is that somebody has to put fresh cash into the company to keep it running during the time it takes for the reorganization plan to be created; salaries have to be paid, drugs have to be manufactured, and utilities have to be paid, and more money has to be available to exit bankruptcy.
<Crystal ball mode on> What will probably happen is that the court will order an auction of the assets that are not security for the debt. If some pharma company wants to buy Afrezza and/or TS, then they can cut a deal with Deerfield on the side, which suits Deerfield just fine because they really just want their money back and have no interest in owning Danbury. If nobody bids at auction, or the amount bid is very small, the court will authorize Deerfield and Sanofi to foreclose on their security. <Crystal ball mode off>
Chapter 11 is typically a consensual process where everybody tries to get as much as they can, but everybody knows going in that they are not going to recover 100%. The reorg plan might say that some pharma will put in $100 million for 80% of the assets, the creditors get 20%, and shareholders take nothing. Or the reorg plan could say the some pharma takes the intellectual property for $10 million and walks away, leaving the rest to be auctioned with the proceeds paid to creditors. Or the court could rule that there is not enough cash left to keep the company running while a reorg plan is finalized and the case is converted to Chapter 7 (see above). Or I can paint a hundred other scenarios so long as I am unencumbered by facts, all of them speculative.
The Mann Foundation is like anybody else. They can bid at auction (anybody reading this can bid too, just bring your checkbook) but will they? If they can buy the company cheaply and pay Deerfield just enough to go away (so they can keep Danbury) that might be in their interest, but then they (the foundation) would own the company 100%. I don't know what the trust indentures say, but do they really want to own the company and be responsible for turning it around, and can they legally deplete the fund assets for this purpose? I can't answer those questions; only the trustees can.
The court will likely not allow any shareholders not contributing "new money" to keep any share of the company unless the creditors are paid in full. The best economic result is for some pharma company to buy Afrezza and TS, let Deerfield and Sanofi take their security, and have somebody with a bit of cash bid for the rest of the company with the proceeds to pay off creditors according to their legal priority. Debt in excess of the available cash is discharged. However, that is a very complex transaction that would take $10-15 million up front to execute, but shareholders might recover something a year or two down the road depending how the deal is structured. Until then there would be no liquidity, and nothing to trade, but it wouldn't be a total wipe-out. However, somebody with cash might just buy it and keep it all for themselves, which they can do as well. Don't shoot the messenger, but in most scenarios the shareholders will get nothing. The company may die or it may live on, depending on the circumstances, but existing shares are typically cancelled.
No matter what happens, all of this will go down within about 100 days after filing. If somebody does have access to the necessary transaction financing, now is the time to get the ducks in a row because once the case starts the process will move very rapidly; the auction is typically conducted three weeks after the court orders it. Once the auction is over the assets are gone and there is no turning back. Bankruptcy auctions, except in very rare cases, are both final and non-appealable, and everything that happens from that point forward is a legal winding up of the company. Lawyers will argue over the scraps for a few months, but without the operating assets Mannkind as we know it will no longer exist. That is the likely reality, don't shoot the messenger.
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Post by buyitonsale on Oct 31, 2016 18:56:52 GMT -5
Does messenger have a position in MNKD?
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Post by liane on Oct 31, 2016 19:03:58 GMT -5
Does messenger have a position in MNKD? That really is uncalled for. matt has been a wealth of information; few of us have that background. I've long said on this board that negative posts are perfectly OK if supported.
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Post by buyitonsale on Oct 31, 2016 19:23:15 GMT -5
Interesting... Asking if someone has a position in MNKD is uncalled for?
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