Does MannKind Have the Wrong Strategy?

Biotech company MannKind (NASDAQ: MNKD  ) remains among the most hotly debated speculative plays on the stock market. Its ultra-rapid inhalable insulin drug Afrezza has yet to gain FDA approval, and it will have to compete with Eli Lilly's Humalog, Novo Nordisk's NovoLog, and Sanofi's Apidra if it does eventually get the green light. While MannKind's story continues to unfold, investors might be questioning whether management has made the right moves and pursued the right strategy up to now. Should the company have invested so much into Afrezza, or should the focus have been on licensing its inhaler technology to other companies? Should MannKind have been conceived as a biotech, or as a medical-device maker? Health-care analyst Max Macaluso weighs in on the debate in the following video.

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Read/Post Comments (14) | Recommend This Article (3)

Comments from our Foolish Readers

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  • Report this Comment On March 12, 2013, at 5:21 PM, steelpoker wrote:

    I'm sorry, but this was really a useless summary of MNKD. I hate to even dignify it with a comment. For those seeking a useful summary of MNKD - see recent post in seeking alpha.

  • Report this Comment On March 12, 2013, at 5:37 PM, garifolle wrote:

    I agreewith stelpoket comment, except for the reference to Seeaking Alpha, even if for the moment there are mainly bullish articles.

    Anytime, SA could publish an article very similar to this one.

    SA is almost an open mill for anyone who thinks he/she is an author.

    (Well not so different as on the Fool, except that there are more comments)

  • Report this Comment On March 12, 2013, at 6:14 PM, Shadowplay1 wrote:

    Just when I thought MF could not get any stupider,they put out this two-bit article on a stock.And buy the way,why do you have this attached with Antares(ATRS)??

    Shadowplay

  • Report this Comment On March 12, 2013, at 7:02 PM, noamps wrote:

    Since you also mention ATRS , I would like to point out to the many other products (beside the TEVA injectors) ATRS is working on.

    Attached is a link to company presentation:

    http://www.antarespharma.com/files/6313/6197/4661/Investor_P...

  • Report this Comment On March 12, 2013, at 11:11 PM, TelsaRowe wrote:

    "License the technology" Now why the hell would they start doing that before they even have a drug which uses the technology approved? Damn idiot. The way mnkd has gone about it they get to have a blockbuster drug which will keep the company rev streams massive while pursuing licensing for other drugs after they prove the delivery technology successful.

    Note to readers of this crap article- Motley Fool offers small amounts of money to qualified contributors and they must publish a specified amount within a time frame. The clown writing this garbage clearly was running out of time and threw this garbage together and submitted it. It should not be looked upon as relevant to mnkd but as a lazy cheap grouping of words to beat a deadline. This author's father should have pulled out and blew him on the $25 a night motel room floor when he had the chance. If you want real insight to mnkd follow me please. Post and ask Q's mnkd on my vid.

    http://www.youtube.com/watch?v=Ewq1pjXzya8

  • Report this Comment On March 13, 2013, at 1:02 AM, noelnavarro wrote:

    The diabetes epidemic is a growing worldwide problem that's not going away anytime soon. Afrezza could very well be one of the most significant drug developed in our contemporary time. It is going to dramatically improve the lives of people with diabetes worldwide, who now number 346 million and forecasted to double by 2030.

    In terms of the risk related to FDA rejection of Afrezza, it should be noted that the FDA does not have any issues with the Afrezza drug itself, but rather the delivery devices being considered for commercial approval. Previous comments from the FDA appear to indicate that they are satisfied with the efficacy and safety profile of Afrezza. The upcoming FDA decision in Q1 2014 is related to the delivery device "Dreamboat". This appears to be a low bar to conquer.

    The consensus valuation of MNKD for the U.S. market only is in the range of $25 to $43 per share after commercialization. If you factor in the global market, it is reasonable to assume that the per share valuation could double. Over a five year horizon after FDA approval (Q1 2014), you could potentially see a conservative 30%+ year-over-year compounded return on investment. MNKD is definitely a long-term investment that could provide extraordinarily high return on investment in the short-run.

  • Report this Comment On March 13, 2013, at 1:05 AM, noelnavarro wrote:

    The diabetes epidemic is a growing worldwide problem that's not going away anytime soon. Afrezza could very well be one of the most significant drug developed in our contemporary time. It is going to dramatically improve the lives of people with diabetes worldwide, who now number 346 million and forecasted to double by 2030.

    In terms of the risk related to FDA rejection of Afrezza, it should be noted that the FDA does not have any issues with the Afrezza drug itself, but rather the delivery devices being considered for commercial approval. Previous comments from the FDA appear to indicate that they are satisfied with the efficacy and safety profile of Afrezza. The upcoming FDA decision in Q1 2014 is related to the delivery device "Dreamboat". This appears to be a low bar to conquer.

    The consensus valuation of MNKD for the U.S. market only is in the range of $25 to $43 per share after commercialization. If you factor in the global market, it is reasonable to assume that the per share valuation could double. Over a five year horizon after FDA approval (Q1 2014), you could potentially see a conservative 30%+ year-over-year compounded return on investment. MNKD is definitely a long-term investment that could provide extraordinarily high return on investment in the short-run.

  • Report this Comment On March 13, 2013, at 8:24 AM, eagle9753 wrote:

    just another reminder of why I stopped visiting the FOOLS site...

    really has changed from what it once was back in the early 2000's....

    credibility is all one has to offer... can't believe some of what now is released under the FOOLS banner...

  • Report this Comment On March 13, 2013, at 1:51 PM, JPG101 wrote:

    Wow. This is probably one of the worst pieces I have seen on Mannkind in a long time.

    Reminds me why I sadly rarely visit Fool.com anymore.

    I wonder if the reports MF charge for are written with as much insight? Almost makes me want to pay the few $ to get the Mannkind report to find out. On second thought maybe not.

  • Report this Comment On March 13, 2013, at 3:00 PM, J1BOB wrote:

    Seldom do I ever watch something and find myself so emotionaly charged that I scream "IDIOT" at the screen.

    IT is amazing that someone who is supposed to be informed is this ignorant. It like he has got to say something contriversial so he can say I dold youso on the odd shot something happens. Can you say CYA.

    Comparing Afrezza to Exhubra is like comparing a Masaratti to a Yugo. They are both cars and thats where it ends. Anyone with half a brain and has followed this saga( and I have been here fror the beginning) knows that there are no safety issues and the trials in progess are soley to define the new inhaler which, as Noelnavarro pointed out above should be a low bar to clear. Its just amazing to hear a supposedly informed guy spew such stupid stuff. The commercialization of the inhaler will come after the drug has been approved and that too is another leg on the stool .

    For this guy to say Novo, Sanofi or Lilly wouldn't be interested in this is like saying microsoft wouldn't be interested in software or Apple wouldn't be interested in starting the I series of products-- So does he think that just because Novo or Lilly have a product there is not something better. The best way to stay on top is to attack yourself with better products-- If you don't someone else will. So much more to say, but this is it for now!!

    What an IDIOT!!!

  • Report this Comment On March 13, 2013, at 5:46 PM, 0b1knob wrote:

    Didn't Pfizer have an inhaled insulin device? And wasn't it rejected by both Doctors and patients? How is Mannkind's device any different?

  • Report this Comment On March 13, 2013, at 9:18 PM, noelnavarro wrote:

    @0b1knob. May the force be with you brothah! Here is a link to an article comparing Afrezza and Exubera:

    http://www.nasdaq.com/article/will-mannkinds-afrezza-succeed...

  • Report this Comment On March 14, 2013, at 11:58 PM, JPG101 wrote:

    This might give big pharma another little nudge in the direction of Mannkind!

    FDA probes new pancreas risks with diabetes drugs

    AP foreign, Thursday March 14 2013

    http://www.guardian.co.uk/world/feedarticle/10701399

    What is there left? Metformin and insulin...

    What would be a good and easy to prescribe combo for GPs?

    Metformin and Afrezza...

  • Report this Comment On April 06, 2013, at 3:35 PM, CromulentBrad wrote:

    a website i claim to hate (but still read) prints a story i don't agree with. grrrrrrrrr. fool make hulk angry. hulk smash fool!!! bad fool!!!

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