Why MNKD Has Had Such A Hard Time
It all started back in late 2014 when MannKind Corporation (NASDAQ:MNKD) received FDA approval from the United States Food and Drug Administration for an inhaled insulin known as Afrezza. When the product was approved, it was expected that it would fly off of the shelves. Unfortunately, that wasn't exactly what happened. Shortly following the approval of Afrezza, MNKD contracted with a company known as Sanofi (PA:SASY) for the commercialization of the treatment. Unfortunately however, Sanofi already had a competing treatment and would drag its feet. After all, if MannKind's Afrezza were to become as popular as it could become, Sanofi would likely lose money on its own product. As a result, sales for Afrezza were incredibly low, and MNKD would fall dramatically as a result. However, I don't think that this will be the end of the story for MNKD, in fact, I think it's just the beginning.
Why I Expect To See Long Run Gains
When it comes to MNKD there are several reasons why I'm expecting to see gains in the long run. Here are some of the most important...
- Afrezza Is An Incredible Product – First and foremost, Al Mann was known for creating incredible products in the medical space. He created the first rechargeable pacemaker, the first artificial retina that allows the blind to see, and in this case, the first inhaled insulin, his last piece of medical innovation before his death. The fact that Sanofi didn't do well with commercialization doesn't take away from the fact that Afrezza is an incredible product. Ultimately, with the right commercialization efforts, Afrezza will be the goose that lays the golden eggs for MNKD
- Technosphere – Afrezza isn't the only think that MNKD has going for it. In fact, I'm pretty impressed with Technosphere as well. Technosphere is the technology that MannKind used to create the inhaled insulin, and it is already being used in studies for other treatments! Pretty soon, we'll likely see indications for technosphere that range from pain management to inhaled treatments for digestive conditions. Ultimately, Technosphere is likely to become incredibly profitable in the long run.
- Sanofi Is Getting Out Of The Picture – As mentioned above, Sanofi had quite a bit to do with the poor launch of Afrezza, which in turn has brought MNKD down. However, it was announced in early 2016 that the agreement between MNKD and Sanofi was coming to an end. This is great because it will give MannKind the ability to commercialize Afrezza as it sees fit, which will lead to growth in sales.
- Commercialization Outreach And Partnerships – Now that Sanofi is completely out of the picture, MNKD has been straightforward with the fact that it is looking for other commercialization partners that don't have a conflict of interest. On top of that, the company has already come up with one great way to lift sales on Afrezza. MannKind will be partnering with Specialized Diabetes Care Centers in order to treat diabetes in real time with Afrezza. The partnership will cost MNKD absolutely nothing, but will lead to increased awareness of Afrezza.
The Bottom Line
It's a shame that Sanofi dragged their feet, leading to declines on MNKD. It's even worse that doing so made it so that Mann wouldn't see the fruits of his labor with Afrezza after meeting his demise on February 25th. Nonetheless, I will not subscribe to the idea that MNKD is dead and gone. I believe the company has plenty more life in it and that we will likely see big gains moving forward as Technosphere leads to new innovation in medicine and Afrezza becomes properly commercialized. All in all, I'm incredibly excited for the outlook of MannKind over the long run.