Here is how I see this situation:

If you buy MNKD today, you are paying approximately $1.2B for a company that may receive approval for Afrezza in 1Q14, and may generate peak revenues of $4B.

Here is how I arrived at S1.2B: (Based on 1Q12 just reported)

Cash payment to buy all outstanding stock:

$1.90x 143M = $272M

Assume existing loans:

$211M + $283M = $494M

Future expenses until approval of Afrezza:

$20M/Month for 12 month before NDA submission = $240M

$10M/Month for 12 month after NDA submission = $120M

Total future expenses= $360M

If we add up all three costs, we can arrive at the total current cost to buy MNKD:

272 + 494 + 360 = $1.126B or say $1.2B

In other words, we can buy a company today for $1.2B that has a reasonable likelihood of obtaining approval for a drug like Afrezza in two year. A company that has spent about $2.0B and 10 plus years to get to this point. A drug that if approved will generate peak revenues of about $4B per year at the end of a 4 year ramp up.

Based on this very simple analysis, I have convinced myself that the stock is a very very very STRONG BUY.

I would like and appreciate ruthless critique (and corrections) of my assumptions:

Present cost to buy MNKD= $1.2M

Reasonable likelihood of approval in 1Q14

Peak revenue of $4B/Year

Thanks.