Mike Mike Mike......you say $50 in 6 months, $500 in 3 years! With all due respect (I mean I don't play poker with Al's son and all), but I don't think now is the time to be conservative, considering the short intransigence and all.....whispering sources say closer to $250 in 6 months and $2500 in 3 years, maybe even $3500 - granted, the medication does interfere with proper reception, but it was coming through pretty clear last evening; those blasted meds make it difficult, sort of like heavy liquor at a poker game.
Sentiment: Strong Buy
Got it before I left. Interesting conjecture, though of course Lantus is nearing the dreaded patent expiration. Still the thought that they might NOT go after such a huge opportunity is troubling.
OTOH considering the nice 65% split, wouldn't it be interesting if instead they viewed Afrezza as a Godsend to change the whole basal first status quo. If they can convince 'the world' or more precisely the medical community that the new standard, the superior standard is to go with prandial RAA first and relegate their soon to be less profitable basal business as yesterday's obsolete approach, they are back in the proverbial cat bird's seat for years to come. Think about it, it may just be the opposite of your conjecture.
Sentiment: Strong Buy
Not sure Affrezza will ever capture 60% of the market (isn't at least 20% of the current RAA market excluded simply due to the black box 'contraindications' of smoking, asthma(?), and COPD?), though it certainly could, but its unquestionable advantages will almost certainly make it the eventual choice of at least 40% of a market which is increasing approx. 12% per year. In the US alone, each year there are about 2 million new diabetics, and I assume there are about that number who finally 'resign' to adding insulin to their treatment regimen. This doesn't even address the huge pre-diabetic market of approx. 86 million in the US. If SNY can effectively begin to inculcate, to physicians, the benefits of early insulin (Afrezza) adoption in this pre-diabetic population, or just capture the majority of those 7 million who are not achieving proper control with orals alone, well that is where Afrezza eventually becomes a $15 to $20 billion mega-blockbuster. Now granted, that will most certainly not be achieved within 3 or 4 years, but give them say 8 to 10 years, and it coud be done. For now, I will be satisfied with, and expect, MNKD shares at $15 to $20 within 12 to 14 months.
Only fooolls and paid pumpers ever caimed a $200 s/p at such an early stage, in fact the estimates I recall mostly topped out about $100 -$112 after 3 years. Of course most, regardless of what is now claimed, expected $500M upfront, doubtful anyone expected such a paltry upfront payment as $150M, along with a stupid high interest loan which wouldn't have been necessary were SNY to have paid a resonable upfront payment. Now things are what they are, and we are facing 6 months of dead money with likely no catalysts in between - oh, except for that secret MDT buyout to be announced any day now. Geeeez - the sheer stupidityy!
$500M upfront wouldn't have effected in any appreciable way the 65/35 split - to intimate such rubbish shows you are ingenuous or just naive. $150M was an insult, a blazing sign reading "No Confidence", and that is exactly how the market interpreted it. You can try and put lipstick on this pig but you are not fooling the institutional money which ran for the exits.
MNKD is by no means out of the woods regarding finances, and there is a very good chance that there will be a significant dilution in relatively short order.
And for all of you who can't stop slobbering over what a great partner is SNY and what a great deal MNKD signed, then ask yourselves why WS doesn't view it as such? Are they really just so clueless? Why was there no 'vote of confidence' equity stake by SNY - why 'only' $150M upfront and why the $175M 'line of credit' wasn't a more realistic $300M at a much more favorable rate?
Sans some significant windfall, you are going to be diluted pretty soon, and it is pretty obvious the shorts have figured this out, seemed actually to have known it all along. Maybe there 'was' sig. BP interest, maybe that was just another rosy interpretation sold to the faithful - guess we will never know, but considering that SNY basically acquired 65% of what will likely go down in history as one of the greatest mega-blockbusters of all time, for very little risk, - they could at least have taken an equity stake, but that would of course served to keep the wolves at bay and support their new partner's stock......but then they knew that and pointedly didn't take a stake - hmmmmm?
That Greenhill boy do they drive a hard bargain - guess it is a good thing there was all that aggressive BP interest which Al alluded to, or who knows, MNKD might have had to pay a partner $300M just get in bed together. Thanks Al, thanks Greenhill - you guys are the best.
You know a lot of you like to rag on Kevin when he gets critical of MNKD (I knee-jerk did it myself recently) but maybe you should take off the rose colored glasses and think a bit about how it is that Al & Co. never miss an opportunity to 'miss an opportunity' to support the retail shareholder even to the smallest degree. Nobody knows how far the shorts will be allowed to go over the next 6 months, but understand dilution is a real and present danger, even sub $7, or $6, etc.
Which translates to dead money for 6 months minimum. The 'bad news' is there are no expected catalysts and the shorts are paying very nice interest.
Your brokerage has already lent your shares out (margin accounts). The institutions just see dead money for 6 to 9 months - so why not avail themselves of the opportunity. It is all about timing, not a genuine vote on the eventual viability of MNKD or Afrezza.
I think the deal was so-so, not great, and not sufficient to dislodge the shorts for possibly another 6 months - during which time the market may rollover hard with QE ending and possibly interest rate increases being moved up to Dec/Jan; a serious market correction before MNKD can prove sales and you could easily see MNKD approaching mid-$5 area. A great deal would have been 60/40 split and $750M upfront.
It is possible they thought the SNY deal would result in a short covering rally. Also possible they were planning on raising cash at $12 to $14.
I will grant you that - and I share your frustration regarding how all this supposed BP interest resulted in the deal with SNY, and in MNKD's mngt. failures, their unwillingness to lift a finger to support the s/p with a reasonable degree of transparency - but intimating that Al is secretly profiting, by arrangement, from the s/p decline??? But, who knows, the heart of man is exceedingly wicked, according to scripture anyway. Sorry about the meds remark - lol, I am just in a really pissy mood - you of course are more than welcome to express your suspicions, to try and find a 'reason' that fits mngt's behavior.
No, this is a financial board - 'it' is about making money, regardless of how nice it is that Afrezza is that much closer to commercial production.
You need to go back on your meds kevin - your turning into a royal p-i-the-a