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Wednesday, Jul 6, 2022

MannKind Gains on Acquisition, FDA Approval

Wearable V-Go strengthens position in diabetic market.

Mannkind Corp.’s stock price rose significantly in May after the company entered an agreement to acquire Zealand Pharma’s V-Go product for $10 million and saw its inhalation tech utilized in a recent Food and Drug Administration approval.

The Westlake Village biopharmaceutical company’s acquisition agreement of V-Go also included sales-based milestones in addition to the cost of certain inventory. The product is a once-daily, wearable, insulin delivery device that helps diabetic patients with blood sugar control, removing the need for taking multiple shots every day.

“MannKind is passionate about being a leader in mealtime control to address this unmet need within the diabetes community,” Michael Castagna, MannKind’s chief executive, said in a statement. “This acquisition strategically leverages our infrastructure in the diabetes space and positions MannKind’s endocrine business for additional growth.”

MannKind’s acquisition of V-Go will add to its portfolio of diabetes-focused products that also includes Afrezza, a rapid-acting inhaled insulin that is the company’s flagship product.

“This transaction is an important step forward in executing on the strategic changes we announced at the end of March, to find partners for our commercial products and refocus our priorities on R&D,” Dr. Adam Steensberg, chief executive of Zealand Pharma, said in a statement.

MannKind’s share price closed at $3.36 the day the acquisition was announced, a 13% increase from a week prior, when the company’s stock was trading at $2.95. 

The company posted a net loss of $26 million in its first quarter report. It also reported $12 million in total revenues for the quarter that reflected Afrezza’s $9.8 million in net revenue and collaborations and services that brought in $2.2 million. 

Afrezza’s gross profit for the first quarter of 2022 was $7.5 million compared to $3.8 million in the same period of 2021, a 99% increase primarily driven by a boost in Afrezza sales and a decrease in cost of goods sold.

The $13.1 million increase in net loss, according to MannKind, was primarily due to a decrease in revenues from collaboration and services and an increase in the cost of revenue for collaborations and services.

Tyvaso collaboration

The company added in its report that it was focused on supporting United Therapeutics in their commercial launch of Tyvaso DPI, an inhalation powder, which received FDA approval on May 24.

The product is the second FDA-approved product that uses MannKind’s Technosphere inhalation technology. It is also the first and only approved dry powdered inhaled treatment for pulmonary arterial hypertension (PAH) and pulmonary hypertension associated with interstitial lung disease (PH-ILD).

PAH is a life-threatening type of high blood pressure that reduces the ability of the heart and lungs to operate properly. It affects an estimated 45,000 people in the United States. 

ILD is a group of lung diseases in which marked scarring occurs within the lungs and is usually complicated by pulmonary hypertension, which furthers symptoms and decreases survival. There are approximately 30,000 PH-ILD patients in the United States.

“This approval is a result of the hard work of the research, development, regulatory and operations teams at MannKind and United Therapeutics,” Patrick Poisson, United Therapeutics’ executive vice president of technical operations, said in a statement. “We are thrilled to provide a dry powder inhaled alternative to liquid nebulization of Tyvaso.”

Tyvaso DPI is produced at MannKind’s Connecticut manufacturing facility.

MannKind and United Therapeutics entered into a worldwide exclusive licensing and collaboration agreement in September 2018 for the development and commercialization of Tyvaso DPI. Last year, the companies established a commercial supply agreement that has an initial term through 2031.

According to MannKind’s earnings report, revenue associated with the commercial supply agreement is deferred as of March this year. It will be recognized over the period when commercial product is sold to United Therapeutics. 

Antonio Pequeño IV
Antonio Pequeño IV
Antonio “Tony” Pequeño IV is a reporter covering health care, finance and law for the San Fernando Valley Business Journal. He specializes in reporting on some of the biggest names in the Valley’s biotechnology sector. In addition to his work with the Business Journal, Tony has reported with BuzzFeed News on the unsupervised use of Clearview AI, a controversial facial recognition technology. Tony, who also conducts freelance reporting, graduated from the USC’s Master of Science in Journalism program in 2021. He is in his fifth year as a journalist as of 2021.

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