MannKind ($MNKD), decimated by the departure of former co-signer Sanofi ($SNY), is trying to conserve value in the face of sluggish sales for its inhaled insulin, signing a deal to transfer some of its pipeline to an obscure new company.
The drug developer put out word Thursday that it had partnered with a newfangled entity called Receptor Life Sciences, handing over the rights to potential inhalable treatments for pain, neurological diseases and inflammatory disorders. The agreement tasks MannKind with handling initial formulation studies for its partner, and the two entities plan to collaborate on clinical development on Receptor's dime. MannKind is due up to $102.3 million in milestone payments, the company said, plus low double-digit royalties on any future sales.
The deal is unlikely to change the narrative around MannKind, which was reduced to a penny stock earlier this month after the poor market performance of Afrezza, its sole product, convinced Sanofi to abandon a deal that could have paid out $775 million in total. MannKind has promised to find another partner willing to market its inhaled insulin, but the company's financial situation has led many investors to doubt whether it'll be in business for much longer.
Compounding matters is the mystery surrounding Receptor, a company described in MannKind's news release as "quietly laying the foundation for groundbreaking new products in the specialty pharmaceutical market." As TheStreet's Adam Feuerstein noted, there are no records of incorporation tied to Receptor in either Delaware or Washington, the state of its listed headquarters. And the company's website is a Squarespace-hosted placeholder that, according to a domain registry, was purchased Jan. 10.
According to a statement from MannKind CEO Matthew Pfeffer--who stepped in after the company's first choice ran into a noncompete issue--the deal with Receptor "demonstrates the fundamental value of our platform technology, while the risk-sharing structure of the transaction allows us to diversify our product opportunities without losing focus on our lead program."
- read the statement