MannKind Corporation (MNKD): A Promising Future in Inhaled Therapeutics

Published on September 24, 2024 | Ticker: MNKD

MannKind Corporation is a biopharmaceutical company focused on the development and commercialization of innovative therapeutic products and devices to address serious unmet medical needs for those living with endocrine and orphan lung diseases. The company's signature technologies—Technosphere dry-powder formulations and Dreamboat inhalation devices—offer rapid and convenient delivery of medicines to the deep lung where they can exert an effect locally or enter the systemic circulation.

Business Overview

In the company's endocrine business unit, MannKind currently commercializes two products: Afrezza (insulin human) Inhalation Powder, an ultra rapid-acting inhaled insulin indicated to improve glycemic control in adults with diabetes, and the V-Go wearable insulin delivery device, which provides continuous subcutaneous infusion of insulin in adults that require insulin. Afrezza was developed by MannKind and received approval from the FDA in June 2014. V-Go received 510(k) clearance by the FDA in 2010 and has been available commercially since 2012. In May 2022, MannKind acquired V-Go from Zealand Pharma A/S and Zealand Pharma US, Inc. and began integrating the product into its endocrine business unit.

The first product to come out of MannKind's orphan lung disease pipeline, Tyvaso DPI (treprostinil) inhalation powder, received FDA approval in May 2022 for the treatment of pulmonary arterial hypertension (PAH) and pulmonary hypertension associated with interstitial lung disease (PH-ILD). MannKind's development and marketing partner, United Therapeutics, began commercializing Tyvaso DPI in June 2022 and is obligated to pay MannKind a 10% royalty on net sales of the product. MannKind also receives a margin on supplies of Tyvaso DPI that it manufactures for United Therapeutics.

Pipeline

The lead program in MannKind's pipeline of potential treatments for orphan lung diseases is MNKD-101, a nebulized formulation of clofazimine, for the treatment of severe chronic and recurrent pulmonary infections, including nontuberculous mycobacterial (NTM) lung disease. In April 2024, the FDA cleared MannKind's investigational new drug application (IND) for MNKD-101, enabling the company to initiate a Phase 3 study that will investigate its potential to treat NTM lung disease and granted Fast Track designation to the development program.

The next most advanced program in MannKind's pipeline is MNKD-201, a dry-powder formulation of nintedanib, for the treatment of idiopathic pulmonary fibrosis (IPF). In April 2024, the FDA cleared MNKD-201 to proceed with a first-in-human Phase 1 study for pulmonary fibrotic diseases, including IPF.

Financials

For the fiscal year ended December 31, 2023, MannKind reported annual revenue of $198,962,000 and a net loss of $11,938,000. The company generated annual operating cash flow of $33,905,000 and annual free cash flow of -$8,536,000. In the first quarter of 2024, MannKind reported total revenue of $66,263,000, a 63% increase compared to the first quarter of 2023. The company recorded net income of $10,630,000 in the first quarter of 2024, a significant improvement from the net loss of $9,795,000 in the same period of the prior year.

MannKind's revenue growth in the first quarter of 2024 was driven by strong performance across its business segments. Tyvaso DPI royalties increased 94% year-over-year to $22,651,000, reflecting the continued strong demand for the product. Collaboration and services revenue grew 118% to $24,848,000, primarily due to higher manufacturing volume and related production activity for Tyvaso DPI sold to United Therapeutics. Afrezza net revenue increased 16% to $14,764,000, driven by a lower gross-to-net revenue adjustment percentage and a price increase, partially offset by the temporary disruption in the company's co-pay program due to a cyber intrusion at Change Healthcare. V-Go revenue declined 16% to $4,000,000 due to lower demand as MannKind shifted its focus to profitability for the product.

Outlook

Looking ahead, MannKind is well-positioned for continued growth. The company expects to make significant progress in its orphan lung disease pipeline, with the initiation of the Phase 3 trial for MNKD-101 and the Phase 1 trial for MNKD-201. In the endocrine business, MannKind is focused on driving further adoption of Afrezza, particularly in the type 1 diabetes and pediatric populations, with the upcoming data readouts from the INHALE-3 and INHALE-1 studies.

Liquidity

MannKind's financial position has also strengthened, with the company ending the first quarter of 2024 with $304,000,000 in cash and investments. The company has also taken steps to optimize its capital structure, including the repayment of its MidCap credit facility and the extinguishment of its Mann Group convertible note, which has reduced its debt burden and future dilution.

Conclusion

Overall, MannKind's diverse product portfolio, robust pipeline, and improved financial position position the company for continued success in the years ahead. The company's focus on addressing unmet medical needs in endocrine and orphan lung diseases, coupled with its innovative drug delivery technologies, make it a compelling investment opportunity in the biopharmaceutical sector.

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