MannKind inhales
For the last company, we move from niche cancer indications to the wide world of diabetes. MannKind's lead candidate is the inhalable insulin Afrezza, a treatment for diabetes types 1 and 2. Afrezza is fast-acting insulin that improves upon existing products like Eli Lilly's Humalog in two significant ways: speedier absorption and needle-free dosing.
Bears will point out that Afrezza is following in the footsteps of Pfizer's failed Exubera. That inhaler-based insulin was released in 2006 and quickly sputtered out, leading to a $2.8 million loss. But Afrezza will be cheaper for patients, and it has a smaller dispersal device that makes it easier to tote around.
Expect phase 3 results next summer, followed by an NDA in the fall. This will be MannKind's third attempt to get Afrezza past the FDA. The continued trials are because of a change in the dispersal device, not any questions with the drug's efficacy.
Afrezza's continued delays have left MannKind with a cash problem. Cash burn for the most recent quarter was around $34 million. Cash, cash equivalents, and short-term investments added up to a bit more than $2 million at the end of that quarter. That cash situation was helped with a secondary offering in September that raised $86 million. And a recent license deal sold off a pipeline cancer drug out for cash up front and royalty payments that could total $140 million. However, another FDA setback could drain MannKind dry.
Foolish final thoughts
Cancer drugs historically have a harder time than other indications in getting FDA approval. But the unmet-need aspect of the Ziopharm and Merrimack drugs could swing things in their favor. MannKind is particularly vulnerable should Afrezza face further problems, and its fate seems most up in the air at this point.
Want to know more about MannKind's chances? Still down around 90% from its highs less than a decade ago, there's been no giant leap for MannKind shareholders. The debate rages over whether Afrezza will be a complete flop or a massive blockbuster success. In this brand new premium report on MannKind, we outline every key topic investors have to know with this risky stock. It also comes with a full year of analyst updates to keep you covered as key news develops, so don't miss out — simply click here now to claim your copy today.
http://www.fool.com/investing/general/2012/12/13/1-catalyst-biotech-investors-need-to-watch-2.aspx
