MannKind Corporation (NASDAQ:MNKD)
MannKind has been an incredibly interesting stock to watch over the past year or so, and for good reason. While the company has created a treatment for diabetes that is second to none on the market at the moment, they dropped the ball when it came to commercialization. However, there is still opportunity here. Today, we'll talk about the bad, the good, and the opportunity that we've seen associated with MNKD.
The Bad
The bad news is the commercialization. As mentioned above, MNKD created a product that is designed to treat diabetes. The product is known as Afrezza, an inhaled insulin. When the product was approved by the FDA, investors expected that it would fly off the shelves. However, MannKind contracted with a company known as Sanofi (PA:SASY) for the commercialization of Afrezza. This was the bad move that MNKD made. You see, Sanofi has a treatment that is in competition with Afrezza. As a result, the company decided to drag its feet on the commercialization process, causing sales to come in well below expectations and sending MNKD down in a big way.
The Good
While there is tons of bad news surrounding MannKind and Afrezza, there is also a bit of good news:
- Afrezza Is A Needed Treatment – First and foremost, Afrezza is a treatment that the diabetic community has been yearning for. You see, all other insulin options at the moment require an injection. This creates a bit of an issue. The reality is that it is estimated that 10% of the population has a fear of needles. This, in combination with the fact that millions of people work in areas that don't allow access to public restrooms, gives Afrezza an inherent need in the industry and, if commercialized properly, will lead to strong sales.
- Cancellation Of Sanofi Agreement – Another bit of good news came in early this year. In January, it was announced that the agreement between Sanofi and MannKind would be coming to an end. This is overwhelmingly positive news as it gives MNKD the ability to commercialize their treatment on their own or look for other commercialization partners.
- Technosphere – While the first approved product for MNKD is Afrezza, the company isn't solely dependent on this treatment. The reality is that the technology behind Afrezza is incredibly valuable. That technology is called technosphere. It has already been announced that MNKD has entered into a partnership for the development of new treatments using technosphere. This, in the long run, could be incredibly profitable.
The Opportunity
At this point, I see MannKind as a great opportunity. While the company has had a hard time in the past, it seems as though the storm is over. At this point, the new CEO of MNKD has a plan for the commercialization of Afrezza and has already moved forward with further development of technosphere. Moving forward, sales of Afrezza will likely start to grow as technosphere leads to new products. All in all, things are starting to look great for MNKD.
What Do You Think?
Where do you think MNKD is headed moving forward and why? Let us know your opinion in the comments below!