FDA's Second Rejection of Mannkind's Inhaled Insulin Has Investors Worried

Jan.20.11 | About: MannKind Corporation (MNKD)

By Michael Fitzhugh
The U.S. Food and Drug Administration told MannKind (NASDAQ:MNKD) that it would not approve its inhaled insulin treatment, Afrezza, without the company conducting additional clinical trials.

Afrezza is powdered insulin for helping adult patients with type 1 and type 2 diabetes mellitus control high blood glucose, also known as hyperglycemia, which is a major cause of diabetes-related complications. An FDA decision on the drug was initially expected by January 16, 2010. Now the agency’s determination could be delayed for a year or more, some analysts say.

It is the second time the FDA has rejected MannKind’s application for the approval of Afrezza. The agency’s first request for additional data was announced on March 15, 2010, at which time it asked for additional data supporting the clinical utility of Afrezza.

This time, the agency raised concerns about the usage of in vitro performance data and clinical pharmacology data to bridge MannKind's next-generation inhaler to late-stage trials conducted using its current-generation MedTone inhaler. It asked the company to conduct two clinical trials to run a head-to-head comparison of the Medtone inhaler and the next-generation inhaler that will be marketed with Afrezza.

The FDA also said it is seeking information concerning the performance characteristics, usage, handling, shipment and storage of Afrezza’s next-generation insulin-inhalation device, an update of safety information related to Afrezza as well as information on proposed user training and changes to the device’s label and packaging.

MannKind has already begun a series of studies of the next-generation inhaler in patients with type 1 and type 2 diabetes, says Alfred Mann, MannKind’s chairman and CEO.

“We plan to meet with the agency as quickly as possible in order to be confident that these trials, with appropriate modifications to incorporate a comparison to the MedTone device, will suffice in addressing the agency’s questions about patient use and robustness of the next-generation device,” says Mann.

Mann’s enthusiasm for the company and belief in Afrezza were made clear in a January Dow Jones interview in which he revealed that he has personally invested $925 million of the $1.5 billion that's been invested in Afrezza to date.

Some more skittish investors decided to sell their holdings in MannKind, the trading of which was halted just before news of the FDA’s response was made public. Prior to the halt, MannKind shares fell 72 cents to $9.11.