MannKind Corporation (MNKD): The Battle Rages On

MannKind Corporation (NASDAQ: MNKD)

For me, one of the most interesting stocks in biotech is MannKind Corporation. That’s because throughout the past year, MNKD has been the stage for one of the biggest battles between the bulls and the bears that I’ve seen in quite some time. More importantly, there’s a level of validity to each side. So today, we’ll talk about the different views of MannKind stock and discuss whether the bear or the bull is likely to win this battle in the long run. So, let’s get right to it…

Bears Have Quite The Argument

First and foremost, let’s focus on what the bears have to say. When we break the bearish argument down to the bottom line, what we come up with is Afrezza sales. For those of you who haven’t been following MNKD, Afrezza is an inhaled insulin produced by MannKind that was expected to hit the market running. However, as the bears will so gladly point out, it has done anything but. The bottom line is that Afrezza sales are incredibly weak; and have been since the beginning of the pre-launch. Week after week, we’ve seen prescription numbers, and week after week, those numbers have proved to be disappointing at the least. So, the bears argue that if MannKind can’t make sales in the pre-launch, it’s not very likely that they will be able to make sales when they actually do launch sales campaigns around the inhaled insulin. While I will say that I tend to be on the bullish side of the argument, there’s absolutely no denying that the bears have a point here. However, I think that there’s a bit more to the story that the bears aren’t realizing; and that story is a long run one.

Bulls Also Have An Incredibly Valid MNKD Argument

On the other hand, the bulls remain strong; and are doing everything they can to get the stock moving in the positive direction. However, unlike the bears, the bulls aren’t focusing on the short term. In reality, most bulls couldn’t care less about the poor weekly sales reports as they believe that Afrezza will be a smash hit in the long run. It’s also important to mention that the bull argument with regard to MannKind is multifaceted. Here are the moving pieces…

  • Afrezza Has Seen No Advertising – The first argument that just about any bull will make is that no product tends to get very far without advertising. More importantly, Afrezza is in the pre-launch phase, and hasn’t seen any advertising of its own. Therefore, it’s relatively easy for the bulls to shrug off poor sales reports because they know that advertising could make a big difference; which is likely to happen soon. As a matter of fact, we’ve been hearing for about a month now that the Direct to Consumer phase is just around the corner. All in all, the bulls have faith that Afrezza will be a hit, but they also realize that it’s not going to happen over night.
  • Technosphere Is Also Going To Be A Hit – Another thing that the bulls tend to point out is the technology that made an inhaled insulin possible. That technology is called technosphere; and it just so happens that technosphere is a proprietary technology to MannKind. This technology has the potential to assist in the creation of other inhaled medications that for now, can only be delivered via injections. In the long run, this is also likely to be incredibly profitable.

The Deciding Factor In Both Arguments…Time!

When we break the arguments down to their core, what we find is that the defining factor between both of them is time. The reality is that the bears are focusing on short term results and short term reactions. However, the bulls are focusing on the fact that MannKind is an investment, not a trade, and will take time to realize its true value. The bottom line is…. I don’t think that anyone could argue that in the short term, MannKind isn’t likely to blow its value out of the water. However, I’m also not sure that anyone could pheasibly argue that MannKind isn’t going to prove to be a solid long term investment. The key here is the length of time the investor is willing to wait for a return.

What Do You Think

When it comes to MNKD are you a bear or a bull? Let us know your opinion in the comments below!

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3 thoughts on “MannKind Corporation (MNKD): The Battle Rages On”

  1. Bull because Afrezza is giving life saving results to insulin users. Incredible undeniable results. There is no other insulin like it anywhere and probably never will be again so doctors that are seeing it for the first time are also happily surprised and they were not expecting that. Takes time to get started on prescription and insurance details are not all in place but soon will be. Ad campaign not even started yet because no need until everything else needed for successful launch is in place.

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  2. But the Direct to Consumer advertising has begun. Three page ad in Aug. 3 TIME magazine.

    Sanofi_Diabetes tweets, Sanofi internet DTC… there will be much much more this next quarter.

    August—NOW– is when the tide turns for Afrezza. Pediatric study recruitment begun, 4-6 other Technosphere applications in the works…. if this were a Silicon Valley company, I am guessing the valuation would be insane, maybe 20x higher.

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