MannKind Corp. has reduced its debt by $49.5 million through a paid note to the Mann Group and an amended agreement with MidCap Financial Trust, the Westlake Village company said on Monday.The company broke down the debt reduction as follows: $10 million paid to MidCap, $35.1 million paid to the principal balance of its Mann Group non-convertible note, and $4.4 million paid in accrued interest for the same note.Through its amended agreement with MidCap, the biotech company’s available borrowings will increase from $25 million to $60 million through June 30 of next year, the company said in a statement.
Annual interest expense on its remaining debt to MidCap was reduced by $5 million because of a lowered interest rate from 7 to 2.5 percent and an extended maturity date. MannKind’s principal balance with MidCap is currently $40 million.The amended agreement is contingent on certain milestones associated with Tyvaso DPI, an inhalable dry powder MannKind is developing with United Therapeutics to treat pulmonary arterial hypertension and interstitial lung disease.“Starting with the convertible debt offering in March and ending with these debt reductions and restructurings, we have positioned the company with ample cash and a manageable debt load to fund our near-term priorities, enabling us to focus on the development of our product pipeline, investing behind growing Afrezza and supporting our collaborations,” Steven Binder, chief financial officer for MannKind, said in a statement. Binder refers to a private placement of convertible senior notes worth $150 million in March.MannKind is considering a sale-leaseback of its manufacturing facility in Connecticut to raise more capital. The company said it needs to further evaluate options for the facility.Shares of MannKind (MNKD) closed Monday up 15 cents, or more than 3 percent, to $4.83 on the Nasdaq, on a day when that market was up nearly 1 percent.