MannKind Corporation (NASDAQ:MNKD) recently struck a deal with Sanofi SA (ADR) (NYSE:SNY) (EPA:SAN) in connection with marketing its inhaled insulin, Afrezza. Unfortunately for MannKind, however, Sanofi is now transitioning to new leadership and faces a lawsuit related to accusations that it paid kickbacks to doctors who prescribed its drugs.

MannKind Corporation: Sanofi Remains Committed

Sanofi still committed to ManKind

So what effect will these two things have on MannKind and its marketing partnership with Sanofi? Not much, according to analysts at Goldman Sachs. In a report dated Dec. 15, 2014, analyst Jay Olson and his team said Sanofi Chairman and interim CEO Serge Weinberg met with investors to talk about changes in the company’s leadership.

Olson’s colleague Steve Chesney reportedly met with Weinberg and said he came away from the meeting reassured that Sanofi remains committed to MannKind’s Afrezza. He felt reassured that Sanofi sees it as an important part of its diabetes drug portfolio.

The right Sanofi CEO for MannKind

Previously, Sanofi management guided for flat to small growth in its diabetes portfolio through 2018. The Goldman Sachs team notes that pricing pressures on basal insulin have already been discussed, and they expect those same issues to apply to rapid acting insulins as well.

Sanofi management has said they’re optimistic about MannKind’s inhaled insulin, and Weinberg also expressed enthusiasm for the potential of Afrezza. On the topic of finding a new CEO, Weinberg said they’re seeking “a candidate with international pharma experience including a particular emphasis on the U.S. market.” The Goldman Sachs team noted that finding a candidate with experience in the U.S. pharmaceutical market is especially important for the launch of Afrezza.

Goldman Sachs analysts think Sanofi will “maintain a steady course of action in diabetes” based on their recent conversations. The problem they see for MannKind, however, is that the company faces low profitability and delayed profits because the ramp of Afrezza is going slowly. Also the patient-driven market dynamics mean heavy marketing expenses are necessary.

Shares of MannKind Corporation edged upward more than 1% during regular trading hours today.