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MannKind Reports Narrower Y/Y Loss in Q4, Afrezza in Focus - Analyst Blog

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MannKind Corp. 's ( MNKD ) fourth-quarter 2014 loss of 9 cents per share was narrower than the year-ago loss of 16 cents per share and the Zacks Consensus Estimate of a loss of 10 cents.

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MannKind did not generate any revenue in the fourth quarter of 2014 as in the year-ago quarter.

MannKind's full-year loss of 51 cents per share was also narrower than the year-ago loss of 61 cents per share and the Zacks Consensus Estimate of a loss of 52 cents.

The company did not record any revenue during the year.

Quarterly Highlights

Research and development (R&D) expenses for the fourth quarter decreased 39.4% to $17.6 million mainly due to lower non-cash compensation and clinical trial expenses.

General and administrative (G&A) expenses decreased 29% from the year-ago quarter to $12.5 million. The decrease was primarily due to lower non-cash compensation expenses.

MannKind received a milestone payment of $225 million from Sanofi ( SNY ) related to the launch of Afrezza in the U.S. late in the fourth quarter. The company has a collaboration and licensing agreement with Sanofi for Afrezza. Under the deal, Sanofi will be responsible for commercial, regulatory and development activities pertaining to Afrezza across the globe.

We note that Afrezza was approved by the FDA (a rapid-acting inhaled insulin therapy for adults with type I and type II diabetes) in Jun 2014.

2015 Guidance

MannKind expects 2015 G&A expenses to increase sequentially. Quarterly G&A expenses (excluding non-cash stock compensation expenses) are expected to come in roughly between $10 million to $12 million.

R&D expenses (excluding non-cash stock compensation expenses) are expected to decrease from roughly $20 million per quarter in 2014 to roughly $12 million or less per quarter in 2015.

Our Take

We believe that the successful commercialization of Afrezza would provide MannKind with funds in the form of upfront and milestone payments. However, the diabetes market is heavily crowded with the presence of companies including Eli Lilly ( LLY ) among others. We expect investor focus to remain on the commercialization and sales ramp up of Afrezza.

MannKind currently carries a Zacks Rank #3 (Hold). A better-ranked stock in the health care sector is Cytokinetics, Incorporated ( CYTK ) carrying a Zacks Rank #1 (Strong Buy).

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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