Confessions of a Biotech Investor

[Honey Badger(Drewski)]

Recently I purchased a small position in MannKind (MNKD) on a pullback, cost basis 10.03 a share. Seemingly went up everyday. Then, it fell off the cliff. A FDA request for additional information and it's interpretation tanked the stock. Down 24% in one day, it has continued to selloff. Currently down nearly 40% from my original buy point and it has no signs of slowing down. While I have no special insight into the workings of the FDA nor the drug, Affrezza, up for approval, I have to say that the market reaction is wrong in my opinion. I will double down if it falls to or below 5.50 a share.

I understand this is a very risky proposition, especially from a technical analysis standpoint. All I can say is I've got a very strong gut feeling that it gets approved with few if any hitches. I'm following my gut this time....

  Update:  After reading The Intelligent Investor and experiencing the epiphany that followed, I eventually sold out of my entire position in MNKD (at at least a 50% loss I might add) and deployed the money in equities that I could actually figure out a valuation on.   I still follow this company and I still think that it will succeed with Affrezza.  I will revisit it eventually through either the purchase of warrants(  http://www.otcmarkets.com/stock/MNKDW/news ) or through the use of long term options.  Either way I will risk considerably less with the potential to make at least my losses back if not that and considerably more.

In late January MNKD received a CRL from the FDA requesting additional trials with the new delivery system.  Price tanked. Was trading below $6. Today earnings were released accompanied by the conference call.  Financing will be dicey starting in the the fourth quarter and they have already laid people off to help save cash.  Price fell below $4 a share, I bought more at $3.83 a share today.  My feeling is it will either find a partner, be bought out, or taken private.  The prospects of Affrezza and especially the delivery system are to strong for the company to be allowed to fall in my opinion.  I will add to my position again if price fall below $3, especially if it approaches $2.  This approach is fraught with risk and I suggest others do not follow unless you too have balls of steel and a complete lack of functional brain cells!

http://seekingalpha.com/article/240665-clearing-up-the-uncertainty-... Couldn't have said it better myself.

PDUFA date of December 27 for Affrezza..... remember PDUFA dates are more like guidelines for approval decisions, delayed decisions not uncommon.

http://seekingalpha.com/article/206605-a-giant-leap-for-mannkind?so... Apparently I am not the only one that feels this way...