MannKind Corporation (MNKD), Novo Nordisk A/S (ADR) (NVO), Eli Lilly & Co. (LLY): Dreamboat Data? Not Exactly.

In the trial in type 2 diabetics, Afrezza lowered A1c more than placebo by a statistically significant amount. Not exactly a high bar to jump over, but it’ll be good enough for approval.

Partnering first?
MannKind Corporation (NASDAQ:MNKD) is shooting for resubmitting its FDA application in the fourth quarter and, assuming the agency doesn’t find something new to complain about, investors can expect an approval six months after that.

In the meantime, now that it has data, MannKind Corporation (NASDAQ:MNKD) has hired investment bank Greenhill to help it find a partner to market Afrezza.

Finding a partner and the structure of the partnership will be a strong tell as how other companies are feeling about Afrezza’s potential.

If one of the big diabetes players — Novo Nordisk A/S (ADR) (NYSE:NVO), Eli Lilly & Co. (NYSE:LLY), SanofiAstraZeneca, Bristol-Myers Squibb, or Merck — steps up to the plate and makes a large upfront payment, it’ll be a good sign to investors that someone thinks inhaled insulin has a shot at success.

If MannKind Corporation (NASDAQ:MNKD) lands some podunk partner or the deal is completely back-ended with milestones with high sales targets, we can assume that drugmakers are still highly skeptical that there’s a market for inhaled insulin.

Who can blame them, after Pfizer Inc. (NYSE:PFE)‘s flop with Exubera? Admittedly, Afrezza is a much better product, but MannKind and its new partner have a tough task persuading doctors to change the way they think about delivering insulin. Novo Nordisk A/S (ADR) (NYSE:NVO) and Eli Lilly & Co. (NYSE:LLY) clearly saw the writing on the wall when they dropped development after Exubera’s failure.

If Novo Nordisk A/S (ADR) (NYSE:NVO), Eli Lilly & Co. (NYSE:LLY), or Pfizer end up partnering — or even make a bid — I’ll be willing to change my skeptical view, but until then I think investors should be cautious taking a position in MannKind Corporation (NASDAQ:MNKD).

The article Dreamboat Data? Not Exactly. originally appeared on and is written by Brian Orelli.

Fool contributor Brian Orelli and The Motley Fool have no position in any of the stocks mentioned.

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