When all else fails

When all else fails

Later this morning MannKind (NASDAQ:MNKD) will be presenting at the Aegis Capital Growth Conference in Las Vegas. While Diabetic Investor will be listening to this presentation we’ve also been paying close attention to how the MannKind/Afrezza supporters have been handling this latest dive in MannKind shares. Shares have fallen almost 18% over the last thirty days, testing new all-time lows. Still the MannKind/Afrezza fans remain an optimistic bunch believing that this recent plunge is just temporary.

Just today read a piece entitled “MannKind (MNKD) Provides A Presentation Tomorrow: What You Need To Know” by our good friend Joshua Rodriguez, the founder of CNA Finance. Josh has penned many a pieces on MannKind and is big fan of MannKind/Afrezza. In this piece Josh writes;

“There are three things that MNKD investors want to hear about Afrezza; and I’m expecting to see details in the presentation tomorrow…

  • Insurance Coverage – First and foremost, insurance coverage plays a key role in sales of any medication. While Afrezza hasn’t been covered by insurance companies yet, there has been quite a bit of discussion revolving around insurance. In fact, recently it has been predicted that about 80% of major insurance companies will be covering Afrezza in one way or another relatively soon. Now, investors will be looking to the presentation to hear more details on that front.
  • Regulatory Approval – Another big topic of conversation surrounding MannKind has been regulatory approval in Europe and Asia. During the last earnings call, interest was sparked, but we haven’t heard anything about approval in these areas since. So, I’d imagine that this would be on the docket as well.
  • Sales – Finally, sales of Afrezza have been the number one issue for MNKD. Investors want to know how sales are going to be picked up. This may also be discussed in the presentation.”

We just love it when MannKind supporters adjust their position to suit their belief that Afrezza will ultimately become a blockbuster. Josh does with his stance on insurance coverage as the story isn’t just about getting Afrezza covered by payors but how they cover it. As we have noted consistently Tier 3 coverage is coverage but not what’s needed if Afrezza is ever going to move beyond being a niche drug.

Yes regulatory approval oversees would be nice but it won’t change a thing. You would think by now people like Josh would understand getting the drug approved is great but it’s a whole different story getting it covered and into the hands of patients.

Sales numbers would also be nice but more than likely they will not be specific leaving that for when their partner Sanofi (NYSE:SNY) reports third quarter results later this month.

Yet in what has become par for the course it’s not what Josh writes that’s all that important it’s what he omits that speaks loudly. This is another commonality with MannKind/Afrezza fans is how they conventionally omit, forget, ignore or attempt to explain away the many very real issues facing MannKind/Afrezza.

Notice how Josh did not mention the fact that the company has had three layoffs this year. Nor is he curious as to how the company paid their debt. As we recently noted given the precarious state of MannKind’s finances there is cause for serious concern.

Nor does Josh mention the turmoil going on with MannKind’s partner Sanofi. About how this partner has some very serious issues of their own and just might abandon MannKind.

Josh concludes his piece stating;

“While the overall sentiment on MNKD has moved more to the bearish side of the fence, I still have a relatively bullish opinion on the stock. The reality is that although Afrezza has had a rough start, I’m expecting for sales to pick up in the long run. As more advertising becomes available and insurance coverage starts, I think we’re going to see a big change in direction with regard to sales. On the other hand, it’s also important that MNKD is working to use technosphere in other indications. What indications these might be… who knows at this point? One thing we do know is that they are working on it! Hopefully we’ll hear more from that in tomorrow’s presentation. Nonetheless, I’m still a bull!”

Yes there is always hope but hope doesn’t help much given the facts. Like so many MannKind/Afrezza fans Josh doesn’t like the facts so hope is about all they have. The fact is Josh may be a bull but in reality he is full of bull.