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Post by MnkdMainer (MM) on Apr 5, 2014 18:19:22 GMT -5
I ask because I'm interested in waiting until just before the April 15th PDUFA to purchase April 19th out-of-the-money calls. If I buy these calls now, I run the risk that the April 15th decision date is delayed. If that happens, my April 19th calls will expire worthless. So it's to my advantage to wait as long as possible before the expected decision date to buy the calls.
I realize the calls might expire worthless even with a decision on April 15th. That would happen if the share price does not spike significantly. By that, I mean at least a dollar or two. My call strategy contemplates a share price of $8-$9 on April 19th.
I also realize I can protect against a delay by purchasing calls with a later expiration. But I'm not sure I want to pay the increased premium.
Thanks to any experienced biotech investors or others who have some familiarity with the chances of an early approval in our current situation.
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Post by ezrasfund on Apr 5, 2014 19:54:03 GMT -5
Sometimes I tell myself I should follow the leader and be invested in MNKD the way that Al is invested. Those who bought in at the beginning might have bought a whole lot more around $2 when the shares were diluted like Al did, keeping their ownership at the same level ( but at 0.001% not 40% ) and felt pretty good today.
So what does Al own besides shares? I believe he holds a lot of 2016 $2.60 warrants. Which is why I have been looking at the Jan 16 $3 calls. They seem to have a less than $0.50 premium (+/-7% for 20 months). I'm ready to run the same strategy of swapping shares for calls, upping the share count a bit and banking a bit of cash. (40 calls for 3000 shares still takes $3+K off the table for instance).
While approval may seem like a slam dunk, and 4/15 should be the day, it's not over till it's over. And after that there will be many more hoops for MNKD to jump through. And the shorts will probably continue their "yes, but..." strategy of claiming that each milestone met is good, but not that good as they did with trial data and the AdCom vote.
As an aside I suggest folks pay attention to Sayhey44 on the Yahoo board. I first saw him chatting up Al at the 2010 annual meeting in Danbury, and he has some worthwhile insights.
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Post by harshal1981 on Apr 5, 2014 23:05:27 GMT -5
don't think early approval. Minimum 30 day extension.
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Post by milachka63 on Apr 6, 2014 4:00:54 GMT -5
don't think early approval. Minimum 30 day extension. I'm not familiar with FDA processes. If they extend, when do you think they'll announce it? Next week, or the week after? I'm asking because I'm short Apri 11 calls and long Apr 18 calls. |
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Post by Deleted on Apr 6, 2014 15:51:35 GMT -5
ezrasfund, Thanks for the tip to read the last weeks worth of "sayhey44" on YMB. I would say well worth the time for anyone.
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Post by brentie on Apr 6, 2014 16:58:19 GMT -5
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Post by alcc on Apr 6, 2014 17:46:25 GMT -5
Thanks for the link to Seyhey posts. Great read. Interesting he thinks it's gonna be Novartis (sold my Novartis a few months ago.) I agree it won't be LLY or NVO. Makes no sense for either party.
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Post by Deleted on Apr 6, 2014 18:06:42 GMT -5
brentie, Oops, and I read them all too. Well, I'm closer to 63 than you are Brentie so I'll play the age card.
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Post by babaoriley on Apr 7, 2014 2:14:08 GMT -5
Some terrific posts, especially some that were prior to AdCom, and specifically the one where he says that after reading the BD, if one's broker was telling one to get out, one had better get a new broker! That was positively outstanding! The one thing he got wrong, and don't any of you forget it: he let AF off far too easily. I mentioned AF did the only thing he could do in order to survive as long as he can as the tool of the hedge funds, etc. for the long or the short side. Seyhey44 implied he did the honorable thing and owned up; he owned up, but there was zero honor in that - it was expedient and that was all it was. AF is just a big a whatever he was before AdCom, notwithstanding any "'congrats to longs" baloney! |
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Post by babaoriley on Apr 7, 2014 7:16:59 GMT -5
I ask because I'm interested in waiting until just before the April 15th PDUFA to purchase April 19th out-of-the-money calls. If I buy these calls now, I run the risk that the April 15th decision date is delayed. If that happens, my April 19th calls will expire worthless. So it's to my advantage to wait as long as possible before the expected decision date to buy the calls. I realize the calls might expire worthless even with a decision on April 15th. That would happen if the share price does not spike significantly. By that, I mean at least a dollar or two. My call strategy contemplates a share price of $8-$9 on April 19th. I also realize I can protect against a delay by purchasing calls with a later expiration. But I'm not sure I want to pay the increased premium. Thanks to any experienced biotech investors or others who have some familiarity with the chances of an early approval in our current situation. NO! |
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