China: First refusal.

[straightly]

Do not understand how this works, or if it work at all, other than the fact that there will be at least 150 day delay?  Can MNKD put in a compensation clause saying "If Amphastar choose to match, MNKD will compensate the 3rd party for its times and efforts in negotiating the competing terms"?

Cannot put my finger on the pulse.

6.5 Right of First Refusal in China. In consideration of the amendments contained in this Second Amendment and in the Option Amendment, MannKind hereby grants Amphastar the right of first refusal to participate in the development and commercialization of Afrezza in China through a collaborative arrangement. Specifically, Amphastar and MannKind agree that MannKind will not commence the process of obtaining approval of Afrezza in China without first providing Amphastar with (NYSE:I) at least ninety (90) days prior written notice of MannKind's intention to commence the process of obtaining approval of Afrezza in China, and (ii) if Amphastar confirms its interest in collaborating in the development or commercialization of Afrezza in China in writing within thirty (30) days of receipt of MannKind's notice, then the Parties shall reserve sixty (60) days to negotiate in good faith the terms of such a collaborative arrangement for Afrezza in China. In the event that the Parties are unable to agree on commercial terms for a collaborative agreement after the sixty (60) day negotiation period, then MannKind shall have the right to negotiate a collaborative agreement with another party ("Competing Terms"). MannKind shall present the Competing Terms to Amphastar in writing, and within sixty (60) days of receipt of the Competing Terms, Amphastar shall have the option to either decline to match the Competing Terms, or (ii) agree to match the same Competing Terms and enter into a collaborative agreement with MannKind in China.

[agedhippie]

Mannkind can create a contract with a 3rd party containing a break clause agreeing to pay a 3rd party's expenses in the event of Amphastar exercising their option to preempt. Amphastar doesn't care, it's Mannkind's money.

[matt]

What agedhippie said. There is little reason any company would spend time and money to negotiate with MNKD if they knew that Amphastar could steal the deal as it neared the finish line. Agreeing to compensate the other party for their time and efforts is normal business practice, and precisely why most merger agreements have a walk-away clause should a better offer be received by the seller. Practically speaking, the mere existence of the Amphastar arrangement makes other parties less likely to deal with MNKD. Recovery of wasted expenses is one thing, misdirected management efforts are far more difficult to value.

[stinkypete]

I,m not as current on the latest dealings with respect to mnkd. Has mnkd received something from Amphestar to explain their getting this right of first refusal?

[mnholdem]

Amphastar supplies the insulin (human) used in Afrezza. The right of refusal was negotiated into a recently re-negotiated Purchase Agreement between MannKind and Amphastar. You can find the agreement filed with the SEC (there is a link in another ProBoard thread on the topic of China).

[peppy]

amphester makes the insulin approved for afrezza.
for instance the Pfizer insulin mnkd had, would have to have been approved to make afrezza, insulin human.
reference.medscape.com/drug/humulin-r-novolin-r-insulin-regular-human-999007
nph used.

[straightly]

Oct 26, 2017 10:02:06 GMT -5 stinkypete said:

I,m not as current on the latest dealings with respect to mnkd. Has mnkd received something from Amphestar to explain their getting this right of first refusal?

Yes: MNKD was not fulfilling its minimum quota on its purchase agreement. Ampharstar agreed to amend the agreement and this was one of the costs.