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in4thelonghaul

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  • MannKind Corporation: Back To The Fundamentals [View article]
    My apologies George, was rushed - you did indeed express your view that the $150 million upfront "obviates any cash worries for the foreseeable future and....." - As for lowering my expectations....indeed, with Greenhill on the job for a year-plus, and considering at least one statement from Al regarding how the deal likely would be received, I did expect more; a little bit more would have made a big difference. Unfortunately, IMO, this deal allows a 'dead-money' anchor to be hung on MNKD for the next 6 to 8 months, and if by chance the broad market decides to finally roll over hard during this time, Shorty, sans a supporting equity stake by Sanofi, has the wind at his back to drop MNKD's share price to $6, if not lower, and that with almost certain relative ease. Short Interest out on 8/26 should give us a good indication on the short gameplan, but I suspect their aim is to take us further down before covering; it didn't have to be, and hopefully it won't be.

    Anyway, thanks for the article (lots of interesting facts) and the continuing coverage of MNKD. BTW, using your figures, with discounts applied, my calculations put MNKD's fair price at approx. $16 currently.
    Aug 20 04:49 PM | 1 Like Like |Link to Comment
  • MannKind Corporation: Back To The Fundamentals [View article]
    Thanks George for the article - but honestly it isn't quite up to what I have come to expect from you.

    Not hard to go ahead and apply say a ballpark discount rate of say 17%. In consideration of the insultingly absurd and paltry upfront $150M, you didn't address whether you expect a dilutive capital raise will now be required. What is your opinion of Sanofi providing the $175M line of credit (expected MNKD's 35% of the launch costs) at 8% interest? My view is that $175M is the bare minimum and should have been $300M at 3% interest. Why was there no equity stake, say 5% at $10(?) worked into the deal, something which likely would have gone a long long way towards dislodging the huge and intransigent short position by sending a giant indicator of Sanofi's confidence in this joint venture?

    It is my contention that this deal was a giant win for Sanofi, which granted should motivate them to give it their absolute best promotional effort, but a rather marginal deal for MNKD; the most annoying aspect of this partnership deal is that Sanofi could have easily, read that as very little additional expense to them, made this a giant win/win home run for MNKD and of course their shareholdrers, a deal which would have seen the shorts stampeding for the exits. Really, 8% interest on the $175 million dollar upfront loan!??

    It would have been pocket change for Sanofi to offer the barest expected upfront payment of $300 million, and it wouldn't have really been a big deal, in the long run, to offer $500 million upfront - I mean they walked in and gained 65% profit of something which cost over $2 billion and 10 years to develop and shepherd through the FDA gauntlet....a treatment which is likely to eventually produce annual revenues in excess $7 billion, possibly way in excess if they can make serious inroads into the pre-diabetic market of approx. 85 million persons in just the US alone.

    Sanofi appears to have risked little, and their reluctance to make this a truly win/win deal, a homerun for both companies, sent a blaring "No Confidence" indication to WS in general, and put no pressure on the short position what-so-ever......they saved so little by being so stingy - it is a genuine shame.
    Aug 20 01:19 PM | 5 Likes Like |Link to Comment
  • MannKind's Clock Is Ticking, But Balance Sheet Sounds An Alarm [View article]
    Well put....I would only say that it 'could' be as low as $2, or as high as $20 - depending on where it is trading on the 14th (at least on the high estimate).
    Jun 27 12:26 PM | 1 Like Like |Link to Comment
  • MannKind's Clock Is Ticking, But Balance Sheet Sounds An Alarm [View article]
    Thanks for your article Debra...

    You stated: "EvaluatePharma, a provider of market intelligence on life sciences companies, reports that the consensus sales estimate for AFREZZA is near $600 million per year. That implies a sales multiple of 16.6 to reach a market cap near $10 billion (I am assuming all debt is converted and there is no excess cash). That hardly seems plausible."

    Personally, I suspect that at least 1 in 10 insulin dependent US diabetics will pretty much be calling their physicians requesting a switch to Afrezza right out of the gate at product launch; if true, Afrezza sales will achieve over $800 million annual sales on that alone....and that is predicated on just 10% of those already utilizing prandial insulin in their treatment regimen. So one can see that your cited figure of $600M annual sales likely represents an implausibly low market capture projection. My estimates put likely sales of Afrezza at $850 million by Q3/Q4 2015...a roughly 10% (US only) market capture, to be followed by another 10% market capture by Q2/2016; global market capture will likely lag US sales of course, and be dependent on a BP partner, but I would expect similar adoption rates from Europe & ROW to follow upon Afrezza availability in their respective regions.

    My estimate is for Afrezza to eventually capture at least 40% of the global prandial insulin market, and I think 60% is achievable in time - this is of an overall market which 'unfortunately' (well not for MNKD investors) appears to be expanding at roughly a 12% annual rate.

    *BTW...considering the positive effect on margin of MNKD's significant tax loss carryforward and their already expensed insulin in storage, a P/S ratio of 17 to 18 is quite reasonable. PCYC, with under $400M in revenue, sports a 17.5 P/S ratio, and I expect MNKD's margins and growth to easily exceed those of PCYC for many years to come.
    Jun 27 09:38 AM | 1 Like Like |Link to Comment
  • The Inflection Point For Stem Cells: An Interview With Advanced Cell Technology's Management [View article]
    Looking like WS considers STEM the new front-runner to beat in the AMD race.
    Jun 19 03:31 PM | 2 Likes Like |Link to Comment
  • Short MannKind On Afrezza Approval? [View article]
    Highly unlikely, sans a very unfavorable/cumbersome label, that Al would even consider selling MNKD for anything under $40 p/sh - and even then, considering his past statements re. his views on the value of Afrezza, he likely would only 'consider' a $40 acquisition offer long enough get a good laugh with family and mngt. Professional surveys indicate Afrezza's potential to capture 40% of the prandial insulin market within 3 to 4 years...that is a market which apparently in increasing about 10% annually on a global basis; and then there is the value of the 'technosphere' platform which Afrezza approval will have totally validated.
    May 28 09:55 PM | 1 Like Like |Link to Comment
  • Provectus: Strong Sell, Ties To Paid Stock Promoters, SEC Halt Risk, Price Target $0 [View article]
    Gee.....I thought Apple began operations out of a residential garage? Silly me!

    Oh, and isn't it odd that PVCT's PV-10 has achieved, at a couple of the most prestigious cancer research/treatment centers in the US, an amazing record of efficacy for advanced recurrent melanoma in patients who have failed multiple other treatments....think the ORR is over 50%! That is better than anything ever approved by FDA - these patients are approaching death's door with no options left, and here comes a treatment which achieves such results and even has a positive systemic effect on distant untreated tumors! Just odd that a 'scam' treatment, by a 'scam' company could achieve such results.....guess Moffitt, St. Lukes, M.D. Anderson are all involved in the scam - yeah, that explains it! ASCO guys must be involved too!! Boy what a 'service' you have provided with this article....your momma must be proud.
    May 22 09:22 AM | 2 Likes Like |Link to Comment
  • MannKind: Confidence And Cancer [View article]
    Possibly wrong here, but my understanding is that Afrezza use by trial participants resulted in a very small reduction in lung function, forget if it was like 1% or 3%, but it was quite small....also it was my understanding that upon cessation of Afrezza use, the lung function returned to normal - so there was NO Evidence of lung damage whatsoever. Got that? No Lung Damage.

    Now as for long-term use and the potential for some type of lung function reduction or cancer, over and above what transpires with normal aging, that is what the likely periodic monitoring and registry is for. Obviously, regardless of how 'natural' insulin is, it isn't 'natural' to be delivered directly to the lungs.....so any honest person has to allow for some possibility that a 'problem' may arise with long-term use in some people.

    *BTW..From what I have read in the past, daily exposure to the air pollution one encounters in a number of metropolitan areas of California or possibly Texas is equivalent to smoking a number of cigarettes a day (of course it varies by area, whether one exercises a lot during the worst smog, and time of year).

    What one would do well to keep in mind, is that poor control of one's blood glucose (including wild 'swings') i.e., 'compliance' with one's diabetes/insulin treatment regimen can be devastating to one's overall health - that is a guarantee! So one has to weigh, as best as possible, the benefits of likely increased compliance among most users of Afrezza, and the real likelihood of getting insulin treatment started sooner (proven that many delay insulin treatment due to resistance to the idea of starting injections), against the possibility that a problem may arise from long-term use. All studies/trials to date, animal and with people, indicate NO increased cancer risk, and NO permanent lung function reduction.
    May 19 09:32 AM | 5 Likes Like |Link to Comment
  • Google Semantic Search Vringo's Next Play? [View article]
    In L.A.Rick's defense....he said '$600 million +'......that statement is sooo obvious that it is of course a bit odd, but technically it covers an acquisition for say somewhere between $2 to $3 billion; of course there will be no buyout before we get finality on the laches ruling.
    May 3 08:29 PM | 1 Like Like |Link to Comment
  • MLV Sees A Good Chance Of FDA Approval For MannKind's Afrezza And 60% Upside [View article]
    It is interesting to note that of those who write 'positive' articles regarding MNKD's Afrezza, all appear to have solid credentials such as yourself and George RHO....obviously one would be hard pressed to make such an argument for those who write 'negative' articles. That said, I must take exception with your ridiculously low s/p projection....'5% terminal growth' seems an absurd projection - but I guess that might at least partly explain your $9 s/p target.

    Honestly, when one considers that Afrezza is not subject to the stringent refrigeration requirements of 'normal insulin', is safer by far in that it nearly eliminates to the potential for the dangerous, even fatal, hypoglycemic attack/insulin shock occurrence which those injecting insulin are subject to, has such obvious implications for increased compliance, and has been demonstrated to be superior to any other rapid acting prandial insulin in almost every metric (equivalent in the others)...it seems a 40% market capture may be quite low.

    Your readers should be aware that insulin sales are increasing globally at approx. a 12% rate, with recent US figures approaching 15%. All professionally done surveys which I have run across indicate Afrezza will achieve a minimum 40% market capture when available. It is also of pertinent interest that although the US accounts for somewhere less than 25% of the global diabetic population, by dollar sales volume it accounts for approximately 50%.

    *BTW.... US Insulin Sales: ~ $8.3 B in 2011..up 14.9% from 2010 - Global: $16.7 B..up 12.5% from 2010 - granted that not all of these sales are prandial insulin (pre-meal), but likely about 75% are.

    By simple extrapolation, 2016 US prandial insulin sales are projected to reach $9 billion...a 40% capture rate would equate to a revenue stream in excess of $3.5 billion; this figure doesn't even include 'rest of world' market capture among the global diabetic population.

    Appreciate your article and your views regarding the high likelihood of imminent FDA approval.....but you need to refigure your share price projections using a realistic P/S metric; hint - consider Celgene's P/S metric of ~ 10, or since MNKD has considerable tax loss to carry forward against future sales one might go more for a P/S metric of say 15 such as REGN is sporting. And there is that significant fact of MNKD's already expensed insulin in storage....I think they project it is sufficient to produce the first $10 billion worth of product. And then of course you are aware that once Afrezza is approved, this will validate their underlying 'technosphere' platform....so I wondering why you didn't ascribe any worth to that.

    I think your readers would be well served to read G. Rho's past articles where he places a s/p target closer to $40 than your $9.
    Mar 18 01:40 PM | 19 Likes Like |Link to Comment
  • Activision Blizzard Fails To Have Worlds Patents Ruled Completely Invalid; Case Marches On [View article]
    It's all in one's relative perspective isn't it? Granted, there is still enough potential in the WDDD case, stemming from the relatively low MC as has been argued, to make WDDD a decent investment given a few years and a string of legal victories, but to argue that 'losing' damages from ~ 15-plus years of past infringement....to be left with only ~ 3 years 'worth' seems particularly ludicrous; sure, I guess compared to having the patents totally invalidated because of some clerical error, but this ruling tremendously reduces the potential for profit from holding this investment. My guess is that WDDD will now be subject to the infuriating and withering 'dead-money' shorting tactics which some entity (I wonder who) has been employing so successfully against VRNG. ATVI would have to have rocks for brains to settle now for anything except pennies on the dollar vs what they were facing before the judge invalidated such a huge chunk of past damages. Oh well....luckily I was out of WDDD when this all hit, and was able to enter at 10 cents. As is so frequently the case, it is really the United States' IN-justice system which should be indicted.
    Mar 14 07:57 PM | 2 Likes Like |Link to Comment
  • How Will Subconscious Issues Influence FDA AdCom Voting On Afrezza? [View article]
    Michael.....you should really quit with the 'betrayal thing' - it is laughable and completely unjustifiable. Have you ever heard of the journalistic phrase - 'this is off the record'?? You think there might be a reason for such precautions? You seem quite enamored of the martyrs' mantle, viewing yourself as quite the victim and supremely annoyed, or is it embarrassed, that Mr. Rho revealed that you use tarot cards in making your investing decisions and recommendations. If it was such a secret, why did you reveal it. George Rho did everyone a great service by revealing that fact, a fact which you should have revealed upfront to your readers btw. If you want things kept secret, then you reveal them to only your lawyer and your priest....pretty much everyone else has, to varying degrees, a duty to the truth first and the public at large, especially journalists who write with the intent of influencing the decisions of others.
    Mar 7 05:41 AM | 2 Likes Like |Link to Comment
  • How Will Subconscious Issues Influence FDA AdCom Voting On Afrezza? [View article]
    pranamyay -

    That my friend is just the point and beauty of Afrezza - it greatly reduces the need for such insulin dose micro-management which is required for optimum results from insulin injections!

    In all of my DD research (quite extensive btw) I have run across a number of those who have actually used Afrezza in the trial setting, or rather I have read of their experiences and impressions, and they have all been extremely positive; they have all reported superior blood glucose control using Afrezza...not to mention the tremendous convenience advantages.

    You may indeed be a pharmacist - if so you should be expected to report even a bit more accurately about Pfizer's 'failed' inhalation insulin 'Exubera', instead of implying that such failure was the result of it not working and then trying to extrapolate a likely failure for MNKD's Afrezza. Exubera, with its huge bong like delivery device, was a "commercial" failure because the delivery device was 10 times larger than MNKD's whistle size device and as such only a small percentage of insulin dependent diabetics were willing to make the switch. BTW, my research leads me to believe that MNKD's technosphere-insulin product 'Afrezza' is not only magnitudes more convenient than Exubera, but technically it is just a significant improvement over Pfizer's....it simply, for a number of technical/chemical reasons, works much better and leaves almost no residue in the lungs. For those who wish to persue this you can start by researching the difference in 'monomer' chemical structure to 'hexamer' chemical structure as it relates insulin and the diffusibility of the two into the blood stream....Afrezza is of the monomer structure vs Eubera's hexamer structure.

    You also make the interesting statement that 'Pfizer already failed, why even try'.....are you serious? Gee, I guess once something has been tried and it hasn't worked....well I guess by your reasoning that one should just quit! Quite lucky aren't we that the early pioneers of flight such as the Wright Brothers didn't ascribe to your philosophy. Of course you are welcome to your opinion.....but my research indicates your opinion isn't based on any serious due diligence whatsoever.
    Mar 7 05:19 AM | 4 Likes Like |Link to Comment
  • How Will Subconscious Issues Influence FDA AdCom Voting On Afrezza? [View article]
    Excellent comment yazzbro -

    Another superb example of FDA sabotaging a developmental biotech's AdCom meeting was Arena's first one a few years back. They stacked the AdCom with unqualified participants, some of which admitted that they couldn't even interpret the data and wondered why they were picked for the panel. The FDA also of course not only chooses the questions to be answered by the AdCom participants, but also it is an FDA employee who chairs the meeting....and who can be extremely biased if they choose. Since the unexpected AdCom requirement surfaced, the shorts have been unusually bold in increasing their bets. It is such a total shame that even though Afrezza has been demonstrated, on approximately 6,000 trial participants over a number of years, to be both safer and superior in a number of metrics than anything on the market, that our greatest fear is that of a captured FDA who may willingly put the financial interests of one or two Big Pharma outfits above those of tens millions of diabetics.

    Personally I see little to no need for an AdCom at all; Afrezza has never missed an endpoint and it will, through superior glucose control, near elimination of the dreaded insulin induced hypoglycemic shock or low blood sugar attack, and increased compliance, actually save lives - IF the FDA does the obvious and right thing. The FDA's reputation is so tarnished by so many instances....we can only hope that the current FDA Commissioner is aware and determined not to allow past abuses to be repeated at MNKD's upcoming AdCom. Lives will be literally saved by Afrezza approval...and inversely, lives will be lost needlessly if it is again kept from the US insulin dependent diabetic population. BTW, there is considerable speculation among numerous highly qualified experts in diabetic care that early use of Afrezza among the huge 'pre-diabetic' population might actually keep them from ever progressing into full blown T2 diabetes.
    Mar 6 05:58 PM | 2 Likes Like |Link to Comment
  • Argos Therapeutics: Cancer Immunotherapy Using A Nobel Prize Winning Discovery [View article]
    It seems Needham just initiated ARGS at a 'Buy' with a $17 target; Stifel with a $17 target; Piper Jaffray with an $18 target; and JMP with a $17 target. It seems most are expecting positive trial results for AGS-003, which is in the pivotal study for metastatic renal cell carcinoma (mRCC); but then 1H2016 is a long ways off. It seems to me they are likely going to be seeking, or are already shopping for, more capital. Obviously DNDN has had a very tough time turning a profit with their technology.....I wonder how the ARGS model, assuming P3 success and FDA thumbs up in 2017, differs. Too early for me to invest in this here. NWBO looks to be along quite a bit further with their technology and P3 trial, but of course their's is not for mRCC....though the technologies appear similar.
    Mar 4 09:32 AM | 2 Likes Like |Link to Comment
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