MannKind Corp. on Wednesday announced that the company is offering approximately 10.6 million shares to certain investors in an effort to raise $61 million.
Shares of the Westlake Village biotech have had massive gains since last week when the company announced that the U.S. Federal Drug Adminstration changed the label for its sole commercial product, Afrezza. MannKind’s shares have increased by more than 200 percent since the annoucement on Oct. 2.
MannKind said the 10.6 million shares will be offered at $6 per share. Prior to the announcment of the sale, shares were trading just above $6. After the announcement on Wednesday, shares of MannKkind (MNKD) closed down at $5.47 on the Nasdaq.
According to Spencer Osborn, contributor at financial analysis site Seeking Alpha, if there is a full participation in what the company’s is offering, it provide a cash infusion the company needs.
“But more steps are needed,” Osborn wrote. “What is critical for investors to grasp is how effective MannKind can be with these new funds.”
Osborn added that having $100 million in cash would be ideal for the company to put its very best efforts into marketing Afrezza.
MannKind has stated that as of Sep. 30, the company had approximately $20.2 million in cash and cash equivalents.
"With this offering, we have made substantial progress in our efforts to recapitalize the company," Michael Castagna, chief executive of MannKind, said in a statement.