MannKind Corporation (NASDAQ: MNKD)
MannKind stock is one of those that investors and traders either love or hate; there just doesn’t seem to be a middle ground. This has led to heavy debate with regard to whether or not the stock is an attractive option. In my personal opinion, not only was it a good buy a month and a half ago, it’s an amazing buy today. Here’s why…
Afrezza Will Drive Profit
The single biggest piece of this debate has been Afrezza. For those of you who haven’t been following the topic, Afrezza is the world’s first insulin that can be inhaled. Created by MannKind and sold through Sanofi (NYSE: SNY), Afrezza is like the goose that lays the golden egg for these companies. The only problem is…the goose hasn’t started laying the eggs yet; and that’s where the debate comes in.
MNKD Bears Are Adamant That Afrezza Isn’t A Slam Dunk… I Disagree!
Following a downgrade from Goldman Sachs, MannKind has been getting quite a bit of flack in the market from bears. The primary argument from the bears is that MannKind and Sanofi didn’t do well with the launch of Afrezza; therefore, you can’t expect much in sales over time either. Personally, I beg to differ. Here’s why…
- Timing – First off, it’s important to know that Goldman Sachs downgraded the stock after only 3 weeks of Afrezza market action. In any statistics course I’ve taken, you need at least 30 data points to come up with probable figures. However, for some reason, the analyst analyzed MannKind before Afrezza was even on the market for 30 days. It simply didn’t have the opportunity to perform.
- Physician Feedback – When it comes to Afrezza, unfortunately, there are regulations that stop MannKind from promoting that it is a superior product to other insulin. So, this will have to come right from the physician’s mouth to the patients that are considering it. The good news is that, that’s exactly what’s happening. Physician feedback for Afrezza has bee outstanding! So, it only makes sense to expect Afrezza to slowly make its way through the diabetic community by word of mouth alone.
- Continual Improvements – While MannKind and Sanofi have a hit with Afrezza, they’re not quite done yet. As a matter of fact, MannKind just announced today that it would be offering a larger dose in the line up. The larger dose has already been approved by the FDA and will make the new inhaled insulin more attractive to some patients that need to be more aggressive with their treatments.
What To Expect From MNKD And SNY Moving Forward
As you can see from the above, I’m a bull all the way when it comes to MannKind; and because of licensing, Sanofi is going to make a killing too. While we will most likely continue to see short term declines, they should be looked at as buying opportunities; because in the long run, these stocks should soar!
What Do You Think?
Where are you expecting MNKD and SNY to go? Let us know in the comments below!