Well, sort of.
The company's newly-appointed CEO Matthew Pfeffer gave a presentation yesterday at the J.P. Morgan Healthcare conference during which he updated investors with the company's new thought process on how it plans to proceed with the launch of Afrezza, its inhaled insulin. Afrezza was expected to be a billion-dollar blockbuster drug, but its launch was nothing short of disastrous.
MannKind is being forced to rethink its sales and market strategy after news broke less than two weeks ago that former partner Sanofi (SNY +0.71%) was terminating its commercialization agreement for Afrezza. The short notice hasn't given MannKind enough time to fully formulate its new sales and marketing strategy, but its management team was open about the options it is considering from here.
A potential partner?
The most ideal choice for MannKind would be for it to sign up a new Afrezza partner. An optimal candidate would be a company with deep pockets that is willing to pay a upfront fee to get its hands on the commercial rights to Afrezza. A big presence in the diabetes space would also be a huge plus.
Image source: MannKind.
Of course, the chances of either company signing on at this point look like a long shot. After all, Sanofi is one of the biggest and most successful companies in diabetes, and if it failed to make Afrezza an economic success, why would either Novo Nordisk or Eli Lilly be able to? It's also worth remembering that both Novo Nordisk and Eli Lillly had previously attempted to develop inhaled insulins of their own years ago and ended up abandoning the projects.
Going at it alone
With the chances of finding a partner low, the most likely scenario from here is that MannKind will be forced to continue with the launch alone. One big benefit of this strategy is that it will allow MannKind to work directly with insurance companies to help solve the reimbursement issues that have plagued the launch so far.
Unfortunately, going at it alone creates its own set of problems. Building out a traditional sales force takes time and money, both of which the company is in short supply of right now.
Raymond Urbanski, MannKind's Chief Medical Officer, acknowledged as much during the presentation:
So, we're looking at different ways, we cannot afford a large sales force. Nor -- even if we could, I don't think we would implement that strategy anyway. We're going to look, as Matt alluded to, 21st century ways of addressing this problem.
Social media to the rescue?
This presents a big challenge for the company. The traditional way to market a drug is to hire a sales force that knocks on doctors' doors and educates them on the product. It's expensive, but effective. That's the route Sanofi choose to pursue, and it failed.
So, what to do?
CEO Pfeffer provided some ideas that the company has to help increase the script volume:
We need to get that information out there, get the patients and, as importantly, the doctors and the caregivers trained in what the differences with the product are, how to use it correctly and how to get these advantages. One of the ways we can get maximum benefit from this with minimal dollars outlaid, which is an important thing, is in the social media. Some of you may have -- be aware we now have a MannKind Twitter account.
You read that right. The company is planning on using its Twitter (TWTR +0.00%) account to help it spread the word.
Image source: Twitter.
To be clear, this wasn't the only method that was called out as a way to help build awareness for the drug. The company also mentioned that it has plans to work with patient advocacy groups and diabetes education centers to help build awareness and drive sales. MannKind is also creating an "Afrezza Advocacy Council" to help facilitate conversations between patients and providers that might help to pick up script volume.
What do all of these ideas have in common? Minimal cost. That's important since at current burn rates, the company will be short on cash by the second half of this year. While it could raise capital through an additional equity offering, doing so now, with its stock down so much, would be tremendously dilutive.
But will it work?
If the company does ultimately decide to go at it alone and lean heavily on social media to help it spread the word, it will be taking a big risk. After all, there are regulatory guidelines that limit pharmaceutical company's usage of social media, so it's not like the company will be able to say anything it wants. Management did acknowledge that it will be fully compliant with any rules and regulations, but it's unclear how useful of a tool Twitter would be if the company is hindered in what it can say.
The other huge question in the air is will providers really be willing to prescribe a product for patients without having an easily reachable company representative on hand? While the company did admit it would still likely need to employ a small sales force where needed, it's unknown whether or not that would be enough to convince providers to join Team Afrezza.
Only time will tell if the company will be successful in finding a new partner, or if its low-cost methods of building support will work. At least we know MannKind's management team is committed to making the company viable and is willing to think outside the box.
