MannKind Announces $61 Million Registered Direct Offering of Common Stock
October 11 2017 - 12:02AM
MannKind Corporation (NASDAQ:MNKD) and (TASE:MNKD) today announced
that it entered into definitive agreements with certain
institutional investors and other investors in connection with a
registered direct offering of an aggregate of 10,166,600 shares of
common stock at an offering price of $6.00 per share, for gross
proceeds of approximately $61 million. The offering is expected to
close on or about October 13, 2017, subject to the satisfaction of
customary closing conditions.
“With this offering, we have made substantial
progress in our efforts to recapitalize the company,” said Michael
Castagna, Chief Executive Officer of MannKind.
H.C. Wainwright & Co. is acting as the
exclusive placement agent for the offering.
After deducting the placement agent's fees, the
net proceeds to MannKind are expected to be approximately $57.7
million. MannKind intends to use the net proceeds from the
offering for working capital and general corporate purposes.
The shares are being offered pursuant to a shelf
registration statement on Form S-3 that was previously filed with
the Securities and Exchange Commission (SEC) and declared effective
on April 27, 2016. A final prospectus supplement related to the
offering will be filed with the SEC, and will be available on the
SEC's website located at http://www.sec.gov and may also
be obtained by contacting MannKind at 30930 Russell Ranch Road,
Suite 301, Westlake Village, CA 91362, Attn: Investor Relations, or
by telephone at (818) 661-5000; or from the placement agent at H.C.
Wainwright & Co. LLC, 430 Park Avenue, 4th Floor, New York, New
York 10022, by calling (646) 975-6996 or emailing
placements@hcwco.com.
This press release shall not constitute an offer
to sell or the solicitation of an offer to buy these securities,
nor shall there be any sale of these securities in any state or
other jurisdiction in which such offer, solicitation or sale would
be unlawful prior to the registration or qualification under the
securities laws of any such state or other jurisdiction.
Financial Update
Although MannKind’s financial results as of and
for the three months ended September 30, 2017 are not yet
finalized, the following information reflects its expectations with
respect to such results based on currently available
information:
- For the three months ended September 30, 2017, MannKind expects
to report between $2.6 million and $3.0 million of gross Afrezza
product revenue and between $1.8 million and $2.2 million of net
Afrezza product revenue.
- MannKind estimates that as of September 30, 2017, its cash and
cash equivalents were approximately $20.2 million.
- MannKind estimates that as of September 30, 2017, the principal
balance outstanding for its 9.75% Senior Convertible Notes due 2019
and 8.75% Senior Convertible Notes due 2019 issued under its
facility agreement with Deerfield Private Design Fund II, L.P. and
Deerfield Private Design International II, L.P. was $60.0 million;
its 5.75% Convertible Senior Subordinated Exchange Notes Due 2018
was $27.7 million; and its borrowings under the loan arrangement
with The Mann Group LLC was $79.7 million.
- MannKind estimates that the annual purchase requirements under
the insulin supply agreement with Amphastar as of September 30,
2017 were unchanged from June 30, 2017, except for the impact of
foreign currency translation. MannKind has not yet purchased
the annual minimum required quantities of insulin for 2017 of €2.7
million.
The preliminary financial results presented
above reflect MannKind’s estimates based solely upon information
available to it as of the date hereof, is not a comprehensive
statement of its financial results or position as of or for the
three months ended September 30, 2017, and has not been audited,
reviewed or compiled by its independent registered public
accounting firm, Deloitte & Touche LLP. Accordingly, Deloitte
& Touche LLP does not express an opinion or any other form of
assurance with respect thereto. MannKind’s actual third quarter
results may differ materially from these estimates. Accordingly,
investors should not place undue reliance upon these estimates. For
example, during the course of the preparation of the respective
condensed consolidated quarterly financial statements and related
notes thereto, additional items that would require material
adjustments to be made to the estimated financial information
presented above may be identified. These estimates are not
necessarily indicative of future performance or results of
operations, and are not necessarily indicative of the results that
may be expected for a full year. There can be no assurance that
these estimates will be realized, and estimates are subject to
risks and uncertainties, many of which are not within our control.
See “Risk Factors” and “Special Note Regarding Forward-Looking
Statements” in MannKind’s filings with the Securities and Exchange
Commission, including its most recent annual report on Form 10-K
and quarterly report on Form 10-Q. MannKind believes that its
estimated quarterly financial results presented above are
consistent with the applicable trends and expectations discussed in
“Management’s Discussion and Analysis of Financial Condition and
Results of Operations” in its most recent quarterly report on Form
10-Q.
About MannKindMannKind
Corporation (NASDAQ:MNKD) (TASE:MNKD) focuses on the development
and commercialization of inhaled therapeutic products for patients
with diseases such as diabetes and pulmonary arterial hypertension.
MannKind is currently commercializing Afrezza® (insulin human)
inhalation powder, the Company's first FDA-approved product and the
only inhaled rapid-acting mealtime insulin in the United States,
where it is available by prescription from pharmacies nationwide.
MannKind is headquartered in Westlake Village, California, and has
a state-of-the art manufacturing facility in Danbury, Connecticut.
The Company also employs field sales and medical representatives
across the U.S. For further information, visit
www.mannkindcorp.com.
Forward-Looking
StatementsStatements contained in this press release that
are not strictly historical in nature are forward-looking
statements that involve risks and uncertainties. These
statements include, without limitation, statements regarding
MannKind's expectations with respect to the completion, timing and
size of its offering, the expected proceeds from the offering and
its anticipated use of the proceeds from the offering. Words such
as "believes," "anticipates," "plans," "expects," "intends,"
"will," "goal," "potential" and similar expressions are intended to
identify forward-looking statements. These forward-looking
statements are based upon MannKind's current expectations. Actual
results and the timing of events could differ materially from those
anticipated in such forward-looking statements as a result of
various risks and uncertainties, including, without limitation,
risks associated with market conditions, the satisfaction of
customary closing conditions related to the offering, MannKind's
need and ability to raise additional capital and other risks
detailed in MannKind's filings with the SEC, including its
quarterly report on Form 10-Q for the quarter ended June 30, 2017.
You are cautioned not to place undue reliance on these
forward-looking statements, which speak only as of the date of this
press release. All forward-looking statements are qualified in
their entirety by this cautionary statement, and MannKind
undertakes no obligation to revise or update any forward-looking
statements to reflect events or circumstances after the date of
this press release.
Company Contact:Rose
AlinayaSVP, Investor Relations818-661-5000ir@mannkindcorp.com
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