What a bust MannKind’s inhalable insulin product is!
The marketing partner tasked with selling the product pulled out of the deal last week, an act that chopped MannKind’s stock in half and left the company’s very existence in real doubt. Since the inhalable insulin, called Afrezza, is the company’s only product, and since the marketer was able to sell only a few million dollars’ worth of Afrezza last year – way below expectations – there was open talk last week of a MannKind going-out-of-business sale or bankruptcy.
But wait. Interestingly, right after Sanofi, a French marketing company, said au revoir to inhalable insulin, MannKind execs up in Valencia proclaimed that they have no intention of selling out or going away. They said they’d find a better marketing partner. (See the story on page 5.)
Blog posts suggested the execs must be in denial or inhaling something other than insulin. However, I can’t help but think the execs may be on to something. Oh, sure, initial sales of Afrezza were dismal. But maybe the product was marketed all wrong. Maybe the problem is not with MannKind, which was the manufacturer in the deal, but with Sanofi, the marketer.
MannKind’s product seems fine. I know no diabetics, but it’s not hard to imagine that many would prefer to breathe in insulin from their pocket inhaler than inject themselves regularly or have an insulin pack attached to their body with a catheter. At least a few patients reportedly have said Afrezza is an elegant delivery system that gives them flexibility in their daily lives, although they don’t like the price, which is about twice as much as regular insulin.
The problem is that diabetics generally haven’t heard about Afrezza. That’s because Sanofi marketed the product not to consumers but to doctors. And doctors, like harried humans everywhere, are resistant to change. Since the old method of injecting insulin is well established and comfortable for them to prescribe, they may well be reluctant to try something new and, in their minds, riskier for them and their patients.
What’s more, the Federal Drug Administration requires Afrezza patients to undergo specific breath tests. That’s not only a time-eater for the doctors – they may have to refer patients elsewhere for the test – but it exposes the physicians to new dangers. What if the doctor misreads the test results or if they are wrong?
You could understand physicians for thinking that they’d like to wait a couple of years to make sure any hidden hazards are outed before they prescribe this new drug.
So how can MannKind overcome this problem? By doing what Sanofi didn’t do: marketing directly and robustly to consumers.
There’s a reason why you see all those ads and commercials touting some drug. The ads work. Even though the announcer is obligated to disclose the 17 ways you may suffer an excruciating death as a result of the drug – all while the commercial shows happy people bicycling or dancing or holding hands in twin bathtubs outdoors – some number of consumers are willing to take the risk on the drug because it offers the hope of something better than they have now.
If diabetics know about Afrezza, if the drug is pitched directly to them, many are likely to ask their doctors if they can get it. Some subset probably will demand to get it.
The big question is how long MannKind can hold out. It’s in bad financial shape, and it’s anyone’s guess if more money may be extended by the company’s founder, Alfred Mann, who is now 90 and already has personally invested in the company close to $1 billion, most of which is now lost.
But if MannKind can hold out and if it can enlist a better marketer, we may well discover that Afrezza is not a bust at all. We may find that it is the breakthrough drug that many believed it would be all along.
Charles Crumpley is editor of the Business Journal. He can be reached at email@example.com.
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