"Faster acting" is a marketing slogan employed for everything from heartburn medication to painkillers and now MannKind Corp. likely will have to rely on it to remain in business.
The Valencia developer of inhaled insulin saw its already shriveled market cap cut in half last week after Pfizer Inc. announced that six patients taking a similar drug during a clinical trial came down with lung cancer, more than expected.
But the firm founded by billionaire Al Mann was maintaining its product was far safer than Pfizer's Exubera, in part because MannKind's proprietary form of insulin and inhaler called Technosphere dissolves faster in the lung and works faster.
MannKind is in the process of finishing clinical trials in October, and company officials said they have not observed a higher incidence of lung cancer in patient trials than would be expected in the general population.
The company said Technosphere has a similar pH the measure of the acidity or alkalinity of a substance to that of the human lung. That enables it to dissolve almost immediately into tiny droplets that are quickly absorbed into the blood stream instead of sticking around to irritate the lung as it appears Exubera does.
Pfizer discontinued marketing Exubera in October after sales failed to meet expectations, but inventory remains on the market. Novo Nordisk A/S and Eli Lilly & Co. subsequently ended their inhaled insulin programs, leaving only MannKind and Abbott Laboratories with products in development.
Still, several Wall Street analysts believe that Exubera has so poisoned the well for MannKind that there's little chance that Technosphere will be a financial success even if it is shown to be safer. That perspective, though, is not universal.
Tom Russo at Robert W. Baird & Co. continues to rate the company's shares as "neutral" and is taking a wait-and-see view of MannKind's prospects.
"The remarkable failure of Exubera made it obvious that the first key to success in the pulmonary insulin market is to not be Exubera," said Russo in a note to investors. "But we want to see more data, and view pulmonary safety as the key."
Mann has much of his personal fortune at risk. He's invested more than $900 million of his own funds in MannKind and holds 39 percent of outstanding shares. Last week, he witnessed the company's market cap fall to $238 million as shares closed at $2.53 on April 10. Two years ago they were trading above $19.
While the company has sufficient money to fund operations through 2009, the continuing problems with Exubera has forced MannKind to put on hold talks with several potential partners that could help bring Technosphere to market.
The company is now waiting until it releases its own final safety data before resumption of any talks.
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