Friday, February 11, 2011

Is There Anything Left for Mannkind?

Mannkind Corporation (Nasdaq: MNKD) has taken quite a beating recently.  The big blows came from the FDA when issuing a Complete Response Letter for Afrezza, a inhalable insulin delivery technology that was seen as very promising.  The CRL will require Mannkind to conduct further clinical trials, which require cash.  Mannkind is reported to have less than a year's worth of cash on hand.  In the past, CEO Alfred E. Mann has used his own personal money to help advance Afrezza.  In a conference call, Man  stated that the company will be laying off employees and has not said that he will be infusing more cash into the company to conduct more clinical trials.  Many think that Mann has given up, but perhaps he looking at other options to conduct these trials.  It is believed that most pharmaceutical companies will shy away from inhalable insulin after the failure of Exubera.  Afrezza has numerous advantages over Exubera and is a better product overall.

For investors, it is worth exploring what Mannkind has to offer if Afrezza should fail.  Investors can buy Mannkind stock at a discounted price right now.  At the time of writing, MNKD was down 20% with unusually high volume. It is important for Mannkind to find other sources of funds, whether from the outside or through selling rights to its intellectual property.  

Besides Afrezza, Mannkind is working on an active immunotherapy platform that may be applicable to various forms of cancer.  The idea is interesting and unique from current forms of therapies.  However, Mannkind is still in the early stages, just completing or initiating Phase I studies.  It will be also worth knowing if Mannkind will be able to finance further clinical trials for its oncology program.

Mannkind also has patent rights to the inhaler technology called the "Dreamboat."  Perhaps to raise more funds, the utilization of this technology can be sold to other pharmaceutical and biotech companies studying therapies for respiratory disorders.  The Dreamboat technology can possibly be used with their oncology immunotherapy program.  Since the oncology program is utilizing plasmid DNA and peptides, the inhaler can be used to deliver these to the lung for the treatment of lung cancer.

Mannkind has also developed the Technosphere technology used in Afrezza and another anti-diabetic drug candidate, a GLP-1 analog.  With little cash, Mannkind will find it difficult to continue development of the GLP-1 analog.  The Technosphere technology may find other applications.

Mannkind may need to find a partner to help finance further clinical trials for Afrezza.  A big pharma is the best option, but as mentioned earlier, there is reluctance to venture into the field of inhalable insulin.  There is a risk involved, but the reward is worth it.

Investors should not avoid Mannkind like the plague.  There is still things to like about Mannkind and the company is not doomed for failure.  There is money to be made depending on what direction Mannkind decides to pursue.   

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