MNKD · investment memo
THE SCREEN'S ASSUMPTION ('max(own, industry median)'), retained ONLY for a like-for-like correction of the screen and heavily disputed by the memo: it is roughly FOUR TIMES MannKind's actual TTM operating margin of 4.1% and 1.5x FY2025's 11.1%. At the realised 4.1% margin the price requires a 47.2% five-year revenue CAGR rather than 11.8%. MNKD_Valuation.md s2.4: 'This is the highest-variance parameter and it is where the answer lives... The 16.2% assumption does most of the work in producing a cheap answer.'
Four distinct questions, one field each. A price is not a thesis: the trigger below forces a re-underwrite and freezes further purchases — it is never an automatic sell.
A daily close below $3.21 triggers a mandatory re-underwrite and freezes further purchases. It is not an automatic sell unless a separate fundamental invalidation condition has been breached.
Not stated. This name has no falsifiable invalidation conditions on file, so it cannot be risk-monitored. That is a gap in the research, not a clean bill of health — recorded rather than hidden.
Named cause: United Therapeutics displaces Tyvaso DPI with Tresmi, and MannKind's 64%-of-revenue block stops growing and then declines, against $325m of secured bullet debt. - Not volatility. The permanent-impairment mechanism is: royalty (36% of revenue, ~100% incremental margin) and cost-plus manufacturing (28%) both track one product controlled by one counterparty that has publicly named its replacement, with a stated 2026 filing and 2027 launch. If Tyvaso DPI net sales decline 20% from the current $1.31bn run rate, MannKind loses ~$26m of royalty and a similar order of manufacturing revenu