By Manas Mishra and Bhanvi Satija
(Reuters) -The U.S. Food and Drug Administration declined to approve United Therapeutics (NASDAQ:UTHR) and MannKind (NASDAQ:MNKD) Corp's lung disease therapy, citing an inspection issue at a third-party facility, the companies said on Monday.
The therapy is a drug-device combination that uses United Therapeutics' approved treatment, Tyvaso, in combination with MannKind's portable inhaler.
MannKind's Dreamboat device is a small and portable dry powder inhaler, making its administration more convenient than the traditional nebulized therapy.
MannKind's shares fell 29.3% to $3.60 in premarket trading, while United Therapeutics' shares were down 2.5% at $182.42.
The companies said the agency did not cite any operational shortcomings at MannKind's device manufacturing and testing facility. The inspection was related to a facility that performs analytical testing of a drug substance used in the therapy.
MannKind told Reuters that it remains confident the inspection issue would be resolved "in short order".
The companies were seeking approval of Tyvaso DPI to treat patients with pulmonary arterial hypertension (PAH), as well as PAH associated with interstitial lung disease.
A favorable label for the therapy appears likely, and its approval is a matter of "when" and not "if", J.P. Morgan analyst Jessica Fye said in a note.
While PAH is a type of high blood pressure that affects blood vessels in the lungs, PH-ILDs are a group of diseases that cause inflammation and scarring of the lung tissue, making it harder to breathe.
MannKind and United Therapeutics began collaborating on the pulmonary hypertension product in September 2018. MannKind manufactures the clinical and commercial supplies, while United is responsible for development and regulatory activities.
United said it now expects to launch the product no later than the summer of 2022.