MannKind Corporation (NASDAQ:MNKD) Spikes On Afrezza New Insulin Label

MannKind Corporation (NASDAQ:MNKD)

MannKind Corporation (NASDAQ:MNKD) shares gained 40.1% after the U.S. Food and Drug Administration approved a favorable label change for Afrezza. Human Insulin, Afrezza, is now approved for glycemic control in adult patients with type 1 and type 2 diabetes. According to the company, it is the only inhaled rapid-acting mealtime insulin available in the United States.

The biopharmaceutical company has also confirmed that it successfully exchanged new common stock for outstanding warrants issued last year. The exchange strengthened investors’ confidence as it showed the company’s commitment to cleaning up opportunities for capital flexibility.

MNKD Stock Performance

MannKind Corporation (NASDAQ:MNKD) has gained more than 100% since the start of the month. However, the stock is up by more than 30% for the year. The stock is currently trading at 14-month high and traders are waiting to see if it will continue to rise after registering a new 52 week high of $6.51 a share.

MannKind Corporation (NASDAQ:MNKD)

Afrezza’s new label has revitalized investor confidence on the stock. The biotech company has been under pressure as investors reacted negatively to anemic sales reports. However, the label change should unlock the product’s blockbuster potential.

Afrezza New Label

The new label update includes data that describes the action profile by dosage strength as well as clarity on starting and adjusting mealtime dosage. To conform with current FDA guidance, the label also includes updated pregnancy lactation section.

“These data articulate the rapid-acting nature of Afrezza to address post-prandial hyperglycemia, setting it apart from other mealtime options available to help patients maintain greater control over their blood glucose levels,” said Satish Garg, MD, MBBS, DM — Barbara Davis Center for Diabetes (BDC) – University of Colorado.

Mannkind’s Financial Woes

MannKind Corporation (NASDAQ:MNKD) needs to capitalize on the new label if it is to continue rising higher in the market. The company still faces a string of changes after exiting the recent quarter with only $44 million in cash. Observers question if that amount will be sufficient to support operations going forward.

The company may have to look for additional funds to be able to ramp up the Afrezza commercial launch. Investors may wish to consider bracing themselves for secondary offerings given the spike in MNKD stock.

I have no positions in any of the stocks mentioned, and have no plans to initiate any positions within the next 72 hours. All information, including any data, is provided without any guarantees of accuracy.

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About the author: Monica has an undergraduate degree in Accounting and an MBA she earned – with Honors. She has six years of experience in the financial markets and has been an analyst for the past two years.

Amazon Deal Propels Shares of MannKind Corporation (NASDAQ:MNKD)

MannKind Corporation (NASDAQ:MNKD)

Shares of Valencia, CA-based MannKind Corporation (NASDAQ:MNKD) have gained over 10% from Monday’s close with an hour left in Tuesday’s regular session. The recent two-day rally in MNKD shares is due to the announcement that its OneDrop/Chrome diabetes testing system is now available through Amazon Prime. OneDrop is an FDA-approved, proprietary diabetes testing technology. The company’s main revenue source currently comes from sales of Afreeza – an inhalation powder (human insulin) for use by adults suffering from diabetes. MannKind’s dry powder formulations are based on FDA-approved excipients, including fumaryl diketopiperazine (the excipient used in Technosphere® inhalation powders) and mannitol.

Shares of the biotechnology company are heavily shorted and have a “short float” figure close to 30%. After a reverse split in March to avoid a delisting, MNKD shares continued their fall. After the reverse split the shares were trading above $2.30 but by the end of April MNKD shares were, again, trading under $1.

MannKind Corporation (NASDAQ:MNKD) is a biopharmaceutical company that discovers and develops therapeutic products for patients with diseases such as diabetes. The company dates back to February 1991, when it was incorporated as Pharmaceutical Discovery Corporation in Elmsford, New York. Mannkind’s Technosphere® formulation technology was developed at PDC shortly after its formation.  In the mid-1990s, Alfred Mann – at the time, the CEO of MiniMed Inc. – started working with PDC through a collaborative research effort and eventually became a significant shareholder.  In 2001, the company merged with two other companies owned by Alfred Mann (CTL Immunotherapies Corp. and Allecure Corp.) and the surviving company changed its name to MannKind Corporation (NASDAQ:MNKD).

MannKind Corporation (NASDAQ:MNKD), prior to 2016, had no reported annual sales since 2011 when they posted a figure of $100,000. Since 2011, MNKD shares outstanding figures have increased annually from 121.82 million to 406.17 million in 2015. MNKD EPS has never been positive and in 2015 posted a loss of (-$0.91) that was followed in 2016 by its first profit of $1.37 on sales of $174 million. Two firms follow MannKind Corporation (NASDAQ:MNKD) and both rate MNKD shares as a “Sell” with a consensus price target of $0.54.

I have no positions in any of the stocks mentioned, and have no plans to initiate any positions within the next 72 hours. All information, including any data, is provided without any guarantees of accuracy.

About the author: Marc has a degree in economics and a MSc. in Finance. Over his 20-year career, Marc has worked for global investment firms in Europe and the United States as an analyst, fund manager, and consultant.

Challenging Times For MannKind Corporation (NASDAQ:MNKD)?

MannKind Corporation (NASDAQ:MNKD)

MannKind Corporation (NASDAQ:MNKD) has key debt payments due in the approaching months as its cash burn rate remains restricted by covenants making the refinancing increasingly challenging. Analysts have a divided view on the cash position of the company.

The stock price of MannKind made a new 52-week low on Monday, and could be a stock to watch in today’s trading. MNKD declined to as low as $1.29 in the last trading session after starting the day at $1.49. By the closing bell, the stock was sitting at $1.38 per share for a decline of over 6%.

The highlights

According to MannKind Corporation (NASDAQ:MNKD) management, the company began the year off with cash of almost $70 million. This comes pretty close to the cash flow assumptions that most of the analysts have been giving. They anticipate project cash at the close of Q1 to come around $41.3 million. In addition to the cash balance, the company secured a credit line of $30.1 million. Deerfield has an agreement with Mannkind that needs it to have cash/credit of $25 million at the close of any given quarter.

In 20 weeks, the firm will be out of cash and it will require to use its credit line. Then in 30 weeks, the firm will be in default of contracts, and will have nearly exhausted the credit line – there are not more than 10 months of credit and cash left.

What shareholders need to be conscious of is that analysts do not consider the probability that MannKind Corporation (NASDAQ:MNKD) will require to take some measure much earlier. In fact, the firm will likely intend to extend the debt outflows of $5 million and $15 million earlier than many consider.

The problem the company faces is that it has little leverage. Also, renegotiating debt will be a tough process. As of now, there exists no Sanofi settlement to depend on. This leaves prospect of renegotiation at disapproving terms, dilution, or drawing an association that infuses cash.

Next problem with MannKind Corporation (NASDAQ:MNKD) is that revenue from Afrezza sales has failed to impress anyone. After two years in the industry, a failed association with Sanofi, a re-launch in last July, and a re-launch earlier in this year, sales of Afrezza lead to less than 300 scripts/week while weekly net revenue is trivial at best. Simply said, the company has failed to make enough funds to qualify for capital it needs.

4/03/2017
Ticker Symbol MNKD
Last Price a/o 3:21 PM EST  $1.38
Average Volume 3.27M
Market Cap (mlns)  $ 138.37M
Shares Outstanding (mlns) 100.27M
Share Float (mlns) 73.40M
Inside Ownership 0.10%
Short Float 26.97%
Short Interest Ratio 6.05
Quarterly Return 116.74%
YTD Return 116.74%
Year Return -18.34%

I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 96 hours. All information, or data, is provided with no guarantees of accuracy.

About the author: Monica Gray has an undergraduate degree in Accounting and an MBA – earned with Honors. She has six years of experience in the financial markets and has been a securities analyst for the past two years.