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VIDEOMannkind Making More Excuses for Afrezza
The biotech uses mildly positive data to cover up important details about the drug's regulatory future.
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On Thursday, Mannkind released a press release touting results from a 16-week study that compared the inhalable insulin Afrezza to Eli Lilly’s (LLY) injectible Humalog in treating type 1 Diabetes patients. Results showed that Afrezza worked as well as Humalog in controlling blood sugar when used around mealtimes.
This is mildly good news for the drug -- which was rejected by the FDA in March when the agency required more information. But the news isn’t really something to celebrate: All this proves is that Afrezza is as effective as the standard of care, but not better. While Afrezza does seem more convenient, what the release doesn’t clearly show is that it doesn’t eliminate the need for injections altogether. Type 1 patients will still have to take basal insulin injections before bed every night because their bodies don’t produce insulin at all -- Afrezza would merely replace mealtime injections.
The real story here is that Mannkind seems to be using this mildly positive news to gloss over the important tidbit that it tucked in the “About Mannkind Corporation” section of the press release: the fact that the company has met with the FDA to discuss its Complete Response Letter and will be preparing a resubmission of its New Drug Application.
"To gloss over the most important meeting the company has ever held seems a bit odd to us,” said Hapaolim Securities analyst Jon LeCroy, who has a Sell rating on the stock and values it at $1. “At this point we have no idea what will be required in order to re-submit the NDA and are unsure why the company would not provide some insight into what was possibly the most important meeting in the company’s history.”
LeCroy is certainly right in stating that this was the most important meeting so far in the company’s history. The outcome of this meeting will (has) determined what Mannkind will need to submit to the FDA to achieve approval. (Details Mannkind hasn't shared with investors or the public.) This likely includes the agency’s opinion on the device that Afrezza currently uses to administer the drug (the company indicated previously that there was a possibility that it might have to change the device altogether).
“An already risky situation got riskier and more uncertain following the March 10 Complete Response Letter from FDA, and Mannkind’s regulatory Plan A, including switching the device before approval, is a regulatory long shot lacking precedent,” writes Robert W. Baird analyst Tom Russo in a note to investors. Russo rates the stock Underperform and has a price target of $5.
Afrezza has had a hard regulatory journey thus far, and if history is to be trusted, it wouldn’t have an easy time of it if it actually does make it to market. The Complete Response Letter from the FDA didn’t ask for any more clinical trials, but asked for just about everything but the kitchen sink. The conference call held by the company didn’t make investors feel any better. Mannkind is relying heavily on the approval and partnership of Afrezza, but the company’s future is uncertain if it can’t get approval and a partnership, or doesn’t get an injection of cash from its billionaire benefactor.
Mannkind’s Afrezza isn't the first attempt at inhalable insulin. A much bigger company with a more capable sales force once got approval for such a drug, but even a giant like Pfizer (PFE) couldn’t make the program fly. Pfizer’s Exubera was plagued by problems and never gained traction with physicians who felt uncomfortable switching patients to the drug. It was later shown to be associated with lung cancer in patients who had previously been smokers. Yet a year before evidence of an association with lung cancer came to light, Pfizer abandoned the program due to poor sales (leaving partner Nektar Therapeutics (NKTR) in dire straits). The Exubera failure led to some other, much smarter companies -- Lilly and Novo Nordisk (NVO) -- to abandon inhalable insulin programs altogether. Mannkind didn’t seem to get the hint that an inhalable drug for diabetes might not be the next big thing.
For now, both approval and partnership seem highly unlikely. Any Big Pharma companies that may have been potential partners for the drug lost interest in an inhaled insulin program long ago.Twitter: @biowriterchik
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