Not a Happy Dance

Albert Einstein once said the definition of insanity is performing the same behavior over and over again and expecting a different result. Canada Bill Jones the famous poker player said you can sheer a sheep many times but skin it only once. Finally Momma Kliff said the world is full of blithering idiots who are too lazy or too stupid to perform even the slightest due diligence and deservedly should lose money on their stupid investments.

Just as a refresher the very first inhaled insulin Exubera was a complete and utter disaster. The second inhaled insulin Afrezza from MannKind has a better deliver system, works better than Exubera ever did and has found a small but very loyal following, this after almost 20 years and billions invested. So naturally we need to have third inhaled insulin, which naturally will be better, faster, stronger and of course cheaper than Afrezza.

We need this third inhaled insulin (and truth be told it’s not really the third as Novo Nordisk and Lilly also screwed around with inhaled way back in the day) because there is unmet need in the market that Afrezza is doing so well it has proved a company can make money selling inhaled insulin. We need another because the current crop of injectable insulin’s don’t work well enough and the entire insulin market infrastructure will change and convert to inhaled insulin.

Of course this new inhaled insulin company has the secret sauce to overcome the hurdles MannKind has struggled to jump over and there are three big ones – Lilly – Novo Nordisk and Sanofi. These three companies own the formulary, have brand name recognition, well-established long-standing relationships with physicians, etc. Do we really need to spell out every single advantage these companies have?

Of course this new inhaled insulin company understands the problems MannKind has run into has as much to do with this established insulin infrastructure and very little to do with whether Afrezza works or not. Yes some of the problems MannKind has run into have been self-inflicted, god rest his soul Al Mann did some wacky things, but the problem has never been whether Afrezza works or not, it does work and works very well actually.

Way, way back in the day when people were playing with the Exubera bong, now a collector’s item, we said it would fail while everyone else was saying it would be a billion-dollar product. Instead it turned into a $4 billion disaster for Pfizer who was forced to write down their investment when they pulled Exubera from the market.

Along comes MannKind using the billions earned by its founder, the late Al Mann and after some 20 years we have Afrezza which again everyone said would be a billion-dollar product. We said it was nothing more than a niche product maybe generating a few hundred million in sales.

Next in line is Dance BioPharm. Do they have anything different, NO. Is there “product” better than Afrezza, NO. Do they have billions in capital to take on the established insulin infrastructure, NO. Will any of the established insulin companies buy them, we hate to say no here as these companies have done some pretty stupid things like Sanofi did when they partnered with MannKind and Lilly and Novo did when they foolishly tried to develop their own inhaled insulin’s, so let’s just say it’s highly unlikely that they would buy Dance.

So why is Dance here? What exactly is their function? Are they adding any value whatsoever? Or are they just raping investors, enriching management and when it’s all over and they run out of money leaving these investors high and dry? Frankly these investors deserve to be left holding the bag as it’s suitable punishment for being stupid enough to invest in the first place.

This isn’t a happy dance, heck it’s not even a hippie hippie. What it is a slow methodical death march until the money runs out.