MannKind Corporation (NASDAQ: MNKD)
MannKind is an incredible company. Unfortunately, the company has been beat down in the market over the past year or so. Nonetheless, we’re starting to see very notable gains on MNKD as of late, and for good reason. Matthew J. Pfeffer, the new CEO of the company is making big changes. One of the moves he is making has to do with a company known as Receptor Life Sciences. While this company was concerning for investors when the deal was first announced, MannKind has become more transparent about who this company is and what the plans are, leading to investor excitement. Today, we’ll talk about the transparency, how the market reacted to the news, other reasons to be bullish on MNKD, and what to expect from the stock moving forward.
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MNKD Shares Details About Receptor
Recently, it was announced that MNKD entered into a licensing and cooperation agreement with Receptor Life Sciences. However, because Receptor Life Sciences is a newly formed company that seems to have popped up out of thin air, MannKind investors have questioned the legitimacy of the company and how the agreement is likely to pan out. Nonetheless, MannKind released a FAQ yesterday with regard to the company that cleared up the uncertainty. Some of the most notable facts of the agreement include:
- Who Receptor Life Sciences Is – This has been the most pressing question since the announcement of the agreement. In the FAQ, we learned that Receptor is an independent company with absolutely no affiliation to MNKD. While the company is newly formed, it is being funded by a key investor group as well as supported by prominent business leaders in Seattle. Al Mann is in no way affiliated with the company. The underlying investors in the company have chosen not to disclose their involvement at this time. However, the company is well-funded.
- Is There An Upfront Payment – MNKD did receive an upfront payment associated with the agreement. However, the agreement’s value is mostly in milestone payments. The upfront payment was very minimal.
- Will MNKD Be Able To License Technosphere – Technosphere is a key part of this agreement. However, this agreement does not offer exclusivity on anything other than the treatments created under the agreement. MNKD still has full rights to drive revenue through the licensing of technosphere as a technology.
How The Market Reacted To The News
Any time we see positive news with regard to a publicly traded company, we can expect to see gains in the value of the stock associated with the company. That’s exactly what we’ve seen since MNKD released the FAQ document about Receptor. Yesterday, the stock grew by nearly 20% in a single trading session, and today seems to be overwhelmingly positive as well. Currently (10:16), MNKD is trading at $1.08 per share after a gain of 17.82% so far today.
Other Reasons To Be Bullish On MNKD
While the transparency with regard to Receptor is overwhelmingly positive, it’s not the only reason to be bullish on MNKD. In fact, there are several reasons. First and foremost, Sanofi SA (ADR) (NYSE: SNY) dragged the stock downward thanks to a delay in the commercialization of Afrezza. However, the agreement between the two companies has been canceled and MNKD is free to commercialize Afrezza on its own or license commercialization to a new partner. This is incredibly good news because the reality is that Afrezza is a tremendous product, and now MannKind has the ability to capitalize on it.
It’s also worthwhile to mention that changing leadership to Matthew J. Pfeffer was an incredible idea. While he has only been the CEO for a few weeks, Pfeffer has already done quite a bit of work to ease the minds of investors, license technosphere, and sell Afrezza, all of which will lead to gains for MNKD. Overall, I don’t think a better decision could have been made.
Finally, I’m very impressed with the idea of Specialized Diabetes Care Centers. These care centers will be a place where customers can find treatment for diabetes, and they will be focused heavily on Afrezza, which of course, will increase sales volume.
The Bottom Line
The bottom line here is that MNKD has fallen on some hard times. While they may be down, they are not out. MannKind is a great company, and under new leadership, they are making incredible moves that will lead to long run gains!
Investors: Please Sign Our Petition
As mentioned above, Sanofi’s delay of advertising has cost MNKD and its investors greatly. I have launched a petition in an attempt to help the company and its investors recuperate some of these losses. If you’re a MannKind investor, please click here to sign the petition.
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What Do You Think?
Where do you think MNKD is headed moving forward? Let us know your opinion in the comments below!
[Image Courtesy of Flickr]