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How Will Big Pharma Fight Back Against MannKind?
By Brian Feroldi | More Articles
May 27, 2015 | Comments (1)
MannKind Corp. (NASDAQ: MNKD ) has officially launched its first drug, Afrezza, an inhaled insulin. MannKind's marketing partner Sanofi (NYSE: SNY ) has been selling the drug since February, and recently reported Q1 results, giving investors an early look at how the drug is being received.
Sanofi reported that Afrezza revenue for the quarter came in at 1 million euros (about $1.1 million dollars) -- peanuts considering the massive opportunity in front of the drug. However, as the drug was only launched in February, it's simply too early to know if Afrezza will live up to its hype. We will need to see at least a few quarters of results to know if inhaled insulin will be a game changing therapy, but if it is then MannKind could be poised to disrupt a significant number of highly profitable drugs.
As Afrezza is a fast acting insulin designed to be used at meal time, it is going to compete most heavily with other rapid acting insulins that are currently on the market. Novo Nordisk's (NYSE: NVO ) NovoLog and Eli Lilly & Company's (NYSE: LLY ) Humalog are the current market leaders in meal time insulin, with each drug pulling in billions in revenue each year. As Afrezza is an inhaled insulin that acts quickly and doesn't require an injection, those two companies could ultimately lose a significant amount of market share if Afrezza turns out to be a success.
How will those drug companies fight back against this threat?
With billions in sales on the line, you can bet that Novo Nordisk and Eli Lilly will be devoting their substantial resources to pointing out the negatives of Afrezza as a way of dissuading providers from even offering the drug to patients.
Here are a few of the key points that they will likely be whispering in physicians' ears:
1) Afrezza correlated with diabetic ketoacidosis (DKA) in some trials
In clinical trials, patients with type 1 diabetes who took Afrezza experience DKA, which is when the body produces high levels of blood acids called ketones, more often than patients who were on comparative drugs. As a result, Afrezza is contraindicated for patients who are at risk for DKA, such as those with an acute illness or infection.
2) Dosing may be less precise, more complicated, and require multiple puffs
Source: Mannkind
With insulin pens, patients can easily ratchet up or down doses of insulin in increments as small as 0.5 units. That's important, as sensitivity to insulin can vary hugely from patient to patient, and small changes in doses can causes huge swings in a patient's blood glucose.
With Afrezza, the dosing sizes go up and down in 4 unit chunks, and require patients to follow a cartridge color chart to ensure they are dosing accurately. This may be confusing for some patients and physicians who are use to simply dialing a number into a pen and taking the entire injection all at once.
3) Afrezza has side effects
The most common side effect of Afrezza is hypoglycemia, or low blood sugar, which is also a side effect of currently available insulin. Patients who took Afrezza also reported coughing and a sore throat as common side effects as well.
However, some patients who took Afrezza developed bronchospasms, which is a sudden constriction in the muscles of the lungs. These lung spasms can cause difficulty breathing.
For this reason Afrezza has been contraindicated for patients with a whole range of chronic lung problems such as asthma or chronic obstructive pulmonary disease (COPD). In addition, Afrezza is contraindicated for patients who smoke or have recently stopped smoking, those with lung cancer, those using any inhaled medications, and patients who are pregnant, planning to become pregnant, or are breastfeeding.
4) Type 1 patients still have to take insulin injections
Patients with type 1 diabetes typically use two different types of insulin to control their blood sugar: a long-acting insulin, and a short acting insulin.
Afrezza is a short acting insulin, which eliminates the need to take meal time dosages from other short acting insulins like Lilly's Humalog or Novo's NovoLog. However, type 1 patients will still have to take 1-2 injections per day of long acting insulin, such as Sanofi's Lantus or Novo Nordisk's Levemir.
When you add up all of these negatives, some physicians may find the switch to an inhaled insulin to challenging to make it worth the trouble.
Even with all of these potential negatives being drilled into physicians heads, the allure of an inhaled insulin may simply be too strong for big pharma to fight back successfully. Afrezza's rapid absorption and small size are real benefits that could allow it to succeed where previous attempts at inhaled insulin failed.
Personally, I'm still not convinced that physicians will be won over so easily, as I've seen first hand just how hard it can be to get a provider to try something new. Before I would consider investing in MannKind I would like to see a few quarters worth of results that show prescriptions growing rapidly, which would tell me that physicians are finding value in offering their patients the drug.
The battle for supremacy in meal time insulin dosing just got a whole lot more interesting, and this Fool will be watching closely to see what happens next.
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Brian Feroldi has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
