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  • What Can The Deerfield Conversion Tell Us About MannKind Going Into ADCOM? [View article]
    Given the arrangement here and specific circumstances, I think there is a bit more involved than just moving down the capital structure to get more risk. Try thinking outside of the box past what seems like the obvious.

    Why on earth would they convert before a stock pop? It doesn't make sense for them to do given that their conversion price is the preceding 20 days. Perhaps the January pop is why they converted in January.

    I suspect if you see any sort of large pop out of MNKD on approval, DF will be shorting it to lock in gains of their imminent conversion.
    Mar 14 01:52 PM | Likes Like |Link to Comment
  • What Can The Deerfield Conversion Tell Us About MannKind Going Into ADCOM? [View article]
    Thanks for replying. Just curious to see why you weren't using calls or stock as those would give much better return. Didn't know if you had the position that the stock wasn't going to pop. Can't argue with sitting back and collecting premium though! Good luck!
    Mar 14 12:02 PM | Likes Like |Link to Comment
  • What Can The Deerfield Conversion Tell Us About MannKind Going Into ADCOM? [View article]
    Ad hominems are fun aren't they?
    Mar 14 11:11 AM | Likes Like |Link to Comment
  • What Can The Deerfield Conversion Tell Us About MannKind Going Into ADCOM? [View article]
    George,

    You are wrong about DF seeing the data. The independent consultant was hired under a confidentiality agreement to review the P3 data, determine if it met the requirements for the next tranche, and provide DF with an opinion on whether or not the data met the requirements. DF has not (in theory...never know on the street) seen the full data. This was done to protect DF from becoming an insider due to having material non-public information. Send MNKD an email. They will confirm this as well.

    On point two, I think we will have to agree to disagree because I don't see either of us changing our opinions. You have your opinion and I have mine. It doesn't make sense to me why DF would convert shares, especially now. Why wouldn't they wait to convert after a big pop happens and automatically lock in large gains due to conversion price being calculated off of previous 20 day average price? Short the pop and convert to cover. Easy gains. Perhaps they did that in January on that runup??
    Mar 14 08:42 AM | Likes Like |Link to Comment
  • What Can The Deerfield Conversion Tell Us About MannKind Going Into ADCOM? [View article]
    Thanks for the civil reply. Differing opinions is what makes markets!

    May I ask why you are long MNKD through selling puts instead of calls or stock?
    Mar 14 07:21 AM | Likes Like |Link to Comment
  • What Can The Deerfield Conversion Tell Us About MannKind Going Into ADCOM? [View article]
    You make some good points. I agree that MNKD has a significant challenge ahead of them with the marketing. It takes a large sales force and a ton of capital. I don't think it's fair to compare PFE's $2.2B failure on Exubra to MNKD though. Sure they are both inhaled insulin, but look at how big and clunky the Exubra device was. There's no way in hell anyone would want to use that. The dreamboat is a much more modern, slick, small, and "cool" device that simply looks like an asthma inhaler. MNKD certainly has a huge head start over PFE in that regard.
    Mar 13 02:30 PM | Likes Like |Link to Comment
  • What Can The Deerfield Conversion Tell Us About MannKind Going Into ADCOM? [View article]
    Thanks for the reply. The common bull argument is that they converted because they have more info than the general public and know it will be approved so they want to get into the higher returns of the equity. That is not the premise of my article. My article revolves around the fact that I believe DF converted most of the shares around the same time as the ADCOM announcement and I think they did it to reduce risk going into ADCOM. It doesn't matter what info they do or don't have.

    As stated in comments above, DF had a third party look at the P3 data to get around these insider trading issues. Clearly they did not want to be considered an insider and still wanted to retain the ability to make trades going into PDUFA otherwise why not just look at the data themselves.
    Mar 13 02:21 PM | 1 Like Like |Link to Comment
  • What Can The Deerfield Conversion Tell Us About MannKind Going Into ADCOM? [View article]
    They just amended the agreement to provide up to an additional $90M in debt financing after approval. I don't think money is an issue.
    Mar 13 02:08 PM | Likes Like |Link to Comment
  • What Can The Deerfield Conversion Tell Us About MannKind Going Into ADCOM? [View article]
    This is why an independent party was chosen to look at the P3 data, so that DF is not exposed to material non-public information.
    Mar 13 02:06 PM | Likes Like |Link to Comment
  • What Can The Deerfield Conversion Tell Us About MannKind Going Into ADCOM? [View article]
    DFs independent's expert has seen the data but DF hasn't. The 2nd tranche was only based on the following: The second tranche of Convertible Notes was subject to the achievement of Phase 3 data from studies 171 and 175 that met the primary efficacy endpoints of these studies and did not show any adverse safety issue that would reasonably be expected to prevent approval of AFREZZA.

    So in theory all DF knows is what we know as the independent expert is there to protect DF from having material non-public info and thus being prohibited from trading on it. There are definitely some maybes in my theory solely due to that fact that we don't know what DF is doing. I just don't think it is as simple as most are making it out to be (debt -> equity = good) when you look at the entire situation and factor in the upside DF already has, the value of the notes, and how their shares are priced upon conversion.

    I don't think anyone is getting tired of your comments. Stick around.
    Mar 13 11:47 AM | 1 Like Like |Link to Comment
  • What Can The Deerfield Conversion Tell Us About MannKind Going Into ADCOM? [View article]
    Thanks NTR. One would naturally think debt to equity is positive, but I don't see that here given the circumstances in this situation. Good luck with ADCOM and PDUFA.
    Mar 13 11:28 AM | Likes Like |Link to Comment
  • What Can The Deerfield Conversion Tell Us About MannKind Going Into ADCOM? [View article]
    Did you read any of it? Why did it make sense for DF to convert to shares in January?
    Mar 13 11:24 AM | Likes Like |Link to Comment
  • What Can The Deerfield Conversion Tell Us About MannKind Going Into ADCOM? [View article]
    To reduce ADCOM risk. Why not keep the notes and just purchase shares on the open market? Why wouldn't they wait to see if MNKD stock pops since their conversion price is based on the 20 days preceding the conversion?
    Mar 13 11:20 AM | Likes Like |Link to Comment
  • What Can The Deerfield Conversion Tell Us About MannKind Going Into ADCOM? [View article]
    Also keep in mind that the DF conversion price is governed by:

    "The conversion price will be determined by the volume weighted average price of the common stock during the 20 trading days immediately preceding the conversion date."

    Why would DF convert before PDUFA and take on that risk? If MNKD stock pops after the PDUFA date, why not convert on that day and DF gets shares at the pre-PDUFA price. Built in gain with no risk.
    Mar 13 11:13 AM | 1 Like Like |Link to Comment
  • What Can The Deerfield Conversion Tell Us About MannKind Going Into ADCOM? [View article]
    George,

    What I am saying is, why would DF not simply add shares through the open market and leave the secured notes in place? If they got to see the full P3 data and had no problems with it and thought the stock was going to go up, surely they would not mind adding additional money into MNKD? After all, they did amend the agreement to provide MNKD with more debt. So money isn't an issue. The bulk of the conversion coincides with the ADCOM announcement and makes me wonder if they are derisking based on the uncertainty of that.

    Thanks for your input

    BG
    Mar 13 11:06 AM | Likes Like |Link to Comment
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