Post by mapotofu10 on Jan 13, 2014 8:41:00 GMT -5
From Red Acre Investments :
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Mannkind Corporation (NASDAQ:MNKD)
This week Mannkind ripped upward more than 28% from Monday's opening price of $5.62 to an intra-day high of $7.21 on Thursday. As we told our premium service beta testers on Thursday,we expected the entire biotech sector to be up on Thursday because of the Intercept news (see above). On Friday MNKD gave back almost all of those gains when the company announced that the FDA has set a tentative advisory committee review date for Afrezza. The Endocrinologic and Metabolic Drugs Advisory Committee (EMDAC) is tentatively scheduled to review Afrezza on April first. Until now, MNKD management has been publicly stating that they had not heard anything related to whether or not an AD COMM would be held for Afrezza.
Here is what we wrote to beta testers when we heard the news:
Mannkind announced today that the FDA has indicated that the Endocrine and Metabolic drugs advisory committee will review the NDA for Afrezza tentatively on April 1st.
The stock is giving back yesterday's gains as investors process the new information. While an Ad COMM in and of itself is not overly concerning, what is of concern is that the April 1st date is just 2 weeks before the currently anticipated PDUFA date.
This means either the AD COMM has to be a cake-walk or the approval decision will be delayed by at least 3 months as the FDA takes time to ponder the AD COMM vote and comments.
Expect the AD COMM to include new information regarding detailed safety info from the very large number of trials MNKD has conducted over the years as well as a review of safety from exubera which, while not the same compound, was a previously approved inhaled insulin.
The day 74 letter for Afrezza would have come out on or about December 28th based on the October 15th filing. So this news of an AD COMM coming after that time, for some investors, is unexpected. In reality, there is no hard rule that an AD COMM has to be announced by the time the day 74 letter comes out.
MNKD may form a new base in the $6 to $6.50 range before another leg up. A 3-month PDUFA delay would almost guarantee that the company will tap the ATM facility if they don't raise funds through a secondary offering or a partner
Our view is that the market is concerned that the AD COMM will caused a PDUFA Delay. This is actually an almost certainty unless the FDA is extremely comfortable with all of MNKD's data (which is doubtful after 2 CRLs). Still, on balance, having an AD COMM scheduled is marginally bullish. If there were enough safety or efficacy concerns to warrant rejecting the drug, FDA does not need to waste the time of the advisory committee members. Indeed, twice before FDA issued CRLs without convening an AD COMM so scheduling on represents progress. We suspect that, in addition to a detailed scrutiny of the safety data, on of the primary reasons to seek AD COMM input for Afrezza is that, with the recently completed 175 study, MNKD will seek to have Afrezza approved for use in patients who are insulin naive and have Type II diabetes. This represents a new drug being potentially marketed to 25 million people, it is natural for FDA to seek input prior to making a final decision.
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