Home Stocks MannKind Corporation Bounces After Positive Reports

MannKind Corporation Bounces After Positive Reports

MannKind stock began to rally today after a tough trading day on Thursday. Shares declined 6.55%, falling to $5.71 per share. As of this writing, shares of the drug maker were up 3.08% to $5.89 per share.

Physicians turning positive on Afrezza

The future of MannKind hangs on the success of its only product on the market, an inhaled form of insulin called Afrezza. Sales have been slow to ramp, although analysts who are bullish on the company have said that this is to be expected.

Various firms have been keeping tabs on the number of Afrezza prescriptions doctors are writing and also physician sentiment on the product. Now another new poll of doctors on Afrezza suggests that they’re discovering the new insulin and becoming more interested in prescribing it.

But will doctors start prescribing it?

Jefferies analyst Shaunak Deepak said he spoke to 20 doctors (an extremely small sample, investors should note) who were familiar with Afrezza at the recent meeting of the American Diabetes Association. He reports that the feedback he received was “largely positive.”

He said six of the physicians he spoke to had written prescriptions for Afrezza. However, of the 20 he spoke to, there was only one who objected to possibly prescribing the insulin. That’s much better than the 8% to 12% rejection rate he had previously been expecting.

The one physician who said he probably wouldn’t prescribe Afrezza was concerned about delivering insulin, which is, after all, a hormone, through the lungs. Two other physicians said they wouldn’t prescribe the drug yet because they treat children and the FDA has not approved it for use in children. Both of them were positive on eventually prescribing Afrezza, however, and one said he would take it if he was diabetic.

Accessing Afrezza is a challenge

Three of the doctors who work for the Dept. of Veterans Affairs or the Dept. of Defense were concerned about whether they would receive access Afrezza. One of the physicians hoped to see a “broad government contract,” although the other didn’t think it would ever be “put on formulary.”

Five physicians said the main reason they hadn’t yet prescribed the drug was because of the high cost or the requirement of obtaining prior authorization before prescribing it. Three hesitated to prescribe until they “had identified the ideal patient in need of insulin intensification.”

Deepak said the openness of the doctors toward prescribing Afrezza is a big positive for MannKind and marketing partner Sanofi. They’re currently preparing to increase their efforts and start marketing to consumers in the third quarter.

Feedback for MannKind’s insulin

The analyst added that each of the six physicians who had prescribed Afreza had written a prescription for one to 12 patients each. Among the reasons for prescribing were fear of needles, problems with injection sites, and “control of snacking and post-prandial glucose.”

He noted that most of the doctors’ experience with the insulin was just too limited for them to have much feedback from patients. The one who had written 12 scripts for Afrezza stated that one had been discontinued because of coughing and the other due to compliance issues. However, the doctor stated that the rest of the feedback on the drug was positive.

Two doctors had bought spirometers because of the requirement of lung function testing if prescribing it. The Jefferies analyst found that the ADA made available pamphlets focusing on lung function testing and added that MannKind and Afrezza were working to ease the burden on this testing.

Widening adoption

One suggest Deepak made was that MannKind could improve adoption of the insulin if it made two-unit cartridges available. The reason for this is because five doctors were concerned that being able to adjust the dosage of Afrezza is currently very limited. The insulin currently comes in 4- and 8-unit cartridges, and a 12-unit cartridge was just recently approved.

One doctor wanted to prescribe six units, but that’s impossible because there is no 2-unit cartridge. Further, one of the physicians who hadn’t yet prescribed it said the available doses would be OK for Type 2 diabetics but that a 2-unit cartridge would be better for Type 1 diabetics because it would offer more precise dosing.

Jefferies has a Buy rating and $9 per share price target on MannKind.

MannKind expands marketing efforts

RBC Capital analyst Adnan Butt also attended the ADA conference and has maintained his Outperform rating on MannKind. He noted that for the second half of the year, Sanofi and MannKind are directly targeting consumers and planning to begin a print and direct-to-consumer program in the next few weeks.

They’re also planning a support program for patients, an Afrezza coach program, education, the release of Phase III data, and the launch of the 12-unit cartridge in the third quarter.