Will MannKind Inhale Novo Nordisk's Profits?

MannKind (NASDAQ: MNKD  ) is developing a revolutionary new insulin called Afrezza, which could compete directly with Novo Nordisk's  (NYSE: NVO  ) NovaLog and Eli Lilly's (NYSE: LLY  ) Humalog. Afrezza is inhalable and rapid-acting, which could change the way diabetes is treated.

The market opportunity for diabetes care is massive, but there are a few things investors should know about MannKind before moving forward. Motley Fool Rule Breakers analyst Simon Erickson and analyst Max Macaluso look at some of the challenges that face MannKind, as well as keys for the company to succeed.

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  • Report this Comment On December 11, 2013, at 1:11 AM, robsacher wrote:

    You guys missed a few key reasons why Mannkind may easily take 20%, if not more, of the insulin market within a few years. Their drug, Afreeza, is inhalable through a whistle sized device. It eliminates the need for using a needle and having to inject yourself before each meal.

    I have seen estimates that there may be twenty five million people who have diabetes but refuse to inject themselves. That is a major part of the market that Novo has never reached and Mannkind will definitely be the major player in that segment upon FDA approval in April.

    In addition, while people who have been on the needle for years will unlikely switch to inhalable insulin, younger diabetics, especially children, will probably prefer to switch to Afreeza.

    Last, Afreeza is a safer insulin to use than injectable insulin as diabetics will need about 30% less and any diabetic will tell you that excessive insulin in the body is their greatest fear as that can cause them to go into diabetic shock which can cause death.

    The clinical trials have been quite successful for Afreeza and Al Mann, Mannkind's CEO, has had a series of very successful innovative successes in the past, including the patent on his Insulin Pump which has been a revolution in the field.

    Betting on Novo is like betting on the Hindenburg while betting on Mannkind is more like betting on the Wright Brothers. We all know how won that bet...

  • Report this Comment On December 11, 2013, at 2:15 PM, kjacobsonmn wrote:

    Sorry, not happening for numerous reasons. 1.) No sales force to sell & market. 2.) Needles for injections are so small already. 3.) No Endos are going to switch patients off of injectables & try something that is brand new & totally different right off that bat.

    Best bet is somehow Mankind partners with a proven sales force (not Publics or something similar) and survives initial rebuff & slowly builds up sales over years....

  • Report this Comment On December 11, 2013, at 10:13 PM, robsacher wrote:

    kjacobsonmn,

    I respectfully disagree with you in regard to your points:

    1) Sales force will be supplied by Roche or one of the other major pharmaceutical players now in negotiations with Mannkind.

    2)You obviously don't use needles to inject yourself so believing that a diabetic will prefer to use needles over an inhalable device is a mistake. Would you choose to use a needle next time you need to take a pill? Of course not. Inhalable insulin is just about as easy as taking a pill.

    3) Endocrinologists will suggest Afreeza to patients that are diabetic and refuse using needles and as I previously mentioned, this is a huge market segment.

    Also, endocrinologists will prescribe Afreeza to new patients as an alternative to needle based therapy because Afreeza more closely mimics human insulin created in the pancreas. It is safer and Mannkind's clinical trials have proven this very important point.

    One last point is that GPs can easily prescribe Afeeza without having patients have to go to an endocrinologist. This will save the patient expensive visits to so called 'specialists' and save Medicare and insurance providers a lot of money. That in itself will insure that Afreeza gets offered to patients with diabetes.

  • Report this Comment On December 12, 2013, at 2:02 PM, sstrumello wrote:

    A few points: according to the CDC, more than 75% of insulin users have the autoimmune (type 1) form of diabetes and are extremely insulin-sensitive, hence even tiny changes in dosage can mean the difference between hypoglycemia and hyperglycemia. Afrezza is going to be a non-consideration for most of that group. The ability to refine dosages in amounts smaller than 1 IU is critical, and that can only be done with a pump or syringe, hence that's going to be a very tiny part of Afrezza's user base. That means MannKind must either convert non-using insulin-resistant type 2 patients to become users, or else find a way to deliver more refined dosages for the type 1 audience, which isn't going to happen with Afrezza's current configuration. The other factor to consider is that the therapeutic options for type 2 diabetes are greater today than at any point in history. I would say MannKind has its challenges before it becomes a huge success Mr. Erickson and Mr. Macaluso believe its likely to be.

  • Report this Comment On December 12, 2013, at 6:48 PM, wgreystone wrote:

    @sstrumello: most of Afrezza's clinical trial was on type 1 diabetes,and it demonstrated less hypoglycemia and hyperglycemia incidents compared to existing drugs. Even more fascinating fact is it's not very sensitive to dosage (so a PCP could prescribe it). The likely explanation for the dosage insensitivity is it's absorbed extremely fast and leaves the body in two hours (The period where most insulin is needed). The existing drugs (e.g., humalog) are absorbed much slower and stay in the body much longer (4 to 5 hours), so dosage is critical as you don't want a lot of residue of insulin after digestion completes, otherwise, it could cause hypoglycemia.

  • Report this Comment On December 12, 2013, at 10:57 PM, BioT121 wrote:

    @sstrumello

    According to "Diabetesnet.com", at the time of writing the page linked, 75%-90% of those with diabetes have type 2, not type 1 as you claim, please post a link to your findings.

    http://www.diabetesnet.com/about-diabetes/types-diabetes/wha...

  • Report this Comment On March 28, 2014, at 4:22 AM, sunnypm wrote:

    @BioT121 I think you and sstrumello are both correct. Type 2 is more common in the population, but not all need to "use insulin". Type 1 diabetics have no good choice but to use insulin, ergo more "insulin users" are Type 1.

    My son is type 1, and likes and relies on the pump. He would not change to inhaled insulin. However, type 2's might be interested, if it gives them better control? So, maybe they would start using "insulin" If it could be inhaled, instead of trying diet and exercise, or worse, doing nothing.

    I would rather inhale then take a needle, but also rather take a pill then inhale.

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