After the FDA gave its okay to the design of late-stage trials for the firm's lead inhaled insulin therapy, MannKind ($MNKD) has rolled out a $370 million debt-funding plan today to stock its war chest and bankroll work necessary to bring the treatment for diabetics to the market. The company's stock was trading up more than 11% late this morning.
The debt financing, which has yet to be completed, could raise the stakes for Valencia, CA-based MannKind. To raise the pot of cash, the firm plans to issue senior secured discount notes due in 2017. So the company will have to carry considerable debt along its journey to gain marketing approval of its inhaled insulin product, Afrezza, which is in development for patients with type 1 and type 2 diabetes. The firm has already suffered regulatory setbacks that have delayed its hoped-for market release of the therapy and dampened investors' outlook for the company.
MannKind plans to plow a good portion of its cash into the two Phase III clinical trials of Afrezza that the FDA consented to last month. The company aims to wrap up the pair of trials next year and provide data to U.S. regulators in early 2013, Reuters reported. Meanwhile, MannKind plans to use capital from latest debt financing to fund work on its Danbury, CT, plant and other expenses tied to the commercial release of the insulin product, which could hit the market as early as sometime in 2013 if all goes according to plan.
That would be a huge turnaround for the snake-bitten inhaled insulin market that has seen Big Pharma outfits head for the exits after the high-profile failure of Pfizer's ($PFE) inhaled insulin adventure with Exubera, which the drug giant pulled from the market in 2007.
- here is Mannkind's release
- see the Reuters update