MannKind Corporation Reports 2019 First Quarter Financial Results
May 07 2019 - 8:00AM
MannKind Corporation (NASDAQ:MNKD) today reported financial results
for the quarter ended March 31, 2019.
“In the first quarter of 2019, we executed against the United
Therapeutics License and Collaboration agreement, achieving the
first of four milestone payments of $12.5 million. We also
continued to grow Afrezza net revenue by 49% compared to 1Q 2018
and we released new clinical data at scientific meetings that
continue to differentiate Afrezza from other rapid acting
insulins,” said Michael Castagna, Chief Executive Officer of
MannKind Corporation.
Total revenues were $17.4 million for the first quarter of 2019,
reflecting Afrezza net revenue of $5.1 million and collaboration
and services revenue of $12.4 million. Afrezza net revenue
increased 49% compared to $3.4 million in the first quarter of
2018, primarily driven by higher product demand, a more favorable
mix of cartridges and price. Collaboration and services revenue
increased $12.4 million, primarily due to the United Therapeutics
licensing and research agreements.
Afrezza cost of goods sold was $4.0 million for the first
quarters of both 2019 and 2018. Afrezza gross profit for the first
quarter of 2019 was $1.1 million, the second consecutive quarter
that gross profit was recognized for Afrezza. Afrezza gross profit
for the first quarter of 2018 was negative $0.6 million. The
increase was primarily driven by higher Afrezza sales.
Research and development expenses for the first quarter of 2019
were $1.7 million compared to $2.6 million for the first quarter of
2018. This 37% decrease was primarily attributable to $0.4 million
decreases in both lower clinical trial spending and lower personnel
costs.
Selling, general and administrative expenses for the first
quarter of 2019 were $25.7 million compared to $20.6 million for
the first quarter of 2018. This 25% increase was primarily due to
$9.3 million spent on direct-to-consumer television advertising
offset by a $1.2 million decrease in personnel costs, a $0.9
million decrease in stock-based compensation expense, and a $0.7
million decrease in professional fees.
Interest expense on notes (facility financing obligation and
senior convertible notes) for the first quarter of 2019 was $0.6
million compared to $1.8 million for the first quarter of 2018.
This $1.2 million decrease was primarily due to a reduction in debt
principal balances.
The net loss for the first quarter of 2019 was $14.9 million, or
$0.08 per share compared to a $30.4 million net loss in the first
quarter of 2018 or $0.25 per share. The lower net loss is mainly
attributable to a $14.0 million increase in total revenues.
Cash, cash equivalents, restricted cash, and short-term
investments at March 31, 2019 was $59.8 million compared to
$71.7 million at December 31, 2018. The decrease was primarily due
to net cash used in operating activities of $11.6 million in the
first quarter of 2019, which included the receipt of a $12.5
million milestone payment from United Therapeutics.
Conference Call
MannKind will host a conference call and presentation webcast to
discuss these results today at 9:00 a.m. Eastern Time. To
participate in the live call by telephone, please dial (800)
289-0438 or (323) 794-2423 and use the participant passcode:
6329706. Those interested in listening to the conference call live
via the Internet may do so by visiting the Company's website at
http://www.mannkindcorp.com under News & Events.
A telephone replay of the call will be accessible for
approximately 14 days following completion of the call by dialing
(844) 512-2921 or (412) 317-6671 and use the participant passcode:
6329706#. A replay will also be available on MannKind's website for
14 days.
About MannKind Corporation
MannKind Corporation (NASDAQ: 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 Statements
This press release contains forward-looking statements that
involve risks and uncertainties, including statements regarding
MannKind’s ability to directly commercialize pharmaceutical
products. Words such as “believes”, “anticipates”, “plans”,
“expects”, “intend”, “will”, “goal”, “potential” and similar
expressions are intended to identify forward-looking statements.
These forward-looking statements are based upon the 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 these risks and uncertainties, which
include, without limitation, the ability to generate significant
product sales for MannKind, MannKind’s ability to manage its
existing cash resources or raise additional cash resources, stock
price volatility and other risks detailed in MannKind’s filings
with the Securities and Exchange Commission, including the Annual
Report on Form 10-K for the year ended December 31, 2018. 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.
MANNKIND CORPORATION |
CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS |
(Unaudited) |
(In thousands, except per share amounts) |
|
|
Three Months Ended March 31, |
|
|
2019 |
|
|
2018 |
|
Revenues: |
|
|
|
|
|
|
|
Net revenue
- commercial product sales |
$ |
5,076 |
|
|
$ |
3,402 |
|
Revenue -
collaborations and services |
|
12,372 |
|
|
|
63 |
|
Total
revenues |
|
17,448 |
|
|
|
3,465 |
|
Expenses: |
|
|
|
|
|
|
|
Cost of
goods sold |
|
4,020 |
|
|
|
4,008 |
|
Cost of
revenue - collaborations and services |
|
1,537 |
|
|
|
— |
|
Research and
development |
|
1,667 |
|
|
|
2,644 |
|
Selling,
general and administrative |
|
25,673 |
|
|
|
20,618 |
|
(Gain) Loss
on foreign currency translation |
|
(1,935 |
) |
|
|
2,984 |
|
Total
expenses |
|
30,962 |
|
|
|
30,254 |
|
Loss from operations |
|
(13,514 |
) |
|
|
(26,789 |
) |
Other (expense)
income: |
|
|
|
|
|
|
|
Interest
income |
|
318 |
|
|
|
106 |
|
Interest
expense on notes |
|
(593 |
) |
|
|
(1,794 |
) |
Interest
expense on note payable to related party |
|
(1,080 |
) |
|
|
(1,114 |
) |
Loss on
extinguishment of debt |
|
— |
|
|
|
(825 |
) |
Other income
(expense) |
|
(14 |
) |
|
|
31 |
|
Total other
expense |
|
(1,369 |
) |
|
|
(3,596 |
) |
Loss before provision for
income taxes |
|
(14,883 |
) |
|
|
(30,385 |
) |
Provision for income
taxes |
|
— |
|
|
|
— |
|
Net loss |
$ |
(14,883 |
) |
|
$ |
(30,385 |
) |
Net loss per share - basic
and diluted |
$ |
(0.08 |
) |
|
$ |
(0.25 |
) |
Shares used to compute
basic and diluted net loss per share |
|
187,434 |
|
|
|
120,911 |
|
MANNKIND CORPORATION |
CONDENSED CONSOLIDATED BALANCE
SHEETS |
(Unaudited) |
(In thousands except share data) |
|
|
|
March 31, 2019 |
|
|
December 31, 2018 |
|
ASSETS |
|
|
|
|
|
|
|
|
Current assets: |
|
|
|
|
|
|
|
|
Cash and
cash equivalents |
|
$ |
34,530 |
|
|
$ |
71,157 |
|
Restricted
cash |
|
|
527 |
|
|
|
527 |
|
Short-term
investments |
|
|
24,764 |
|
|
|
— |
|
Accounts
receivable, net |
|
|
3,759 |
|
|
|
4,017 |
|
Inventory |
|
|
3,720 |
|
|
|
3,597 |
|
Prepaid
expenses and other current assets |
|
|
2,392 |
|
|
|
2,556 |
|
Total
current assets |
|
|
69,692 |
|
|
|
81,854 |
|
Property and equipment,
net |
|
|
25,750 |
|
|
|
25,602 |
|
Right-of-use and other
assets |
|
|
5,519 |
|
|
|
249 |
|
Total
assets |
|
$ |
100,961 |
|
|
$ |
107,705 |
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' DEFICIT |
|
|
|
|
|
|
|
|
Current liabilities: |
|
|
|
|
|
|
|
|
Accounts
payable |
|
$ |
6,978 |
|
|
$ |
5,379 |
|
Accrued
expenses and other current liabilities |
|
|
18,064 |
|
|
|
15,022 |
|
Facility
financing obligation |
|
|
11,385 |
|
|
|
11,298 |
|
Deferred
revenue - current |
|
|
32,384 |
|
|
|
36,885 |
|
Recognized
loss on purchase commitments - current |
|
|
9,057 |
|
|
|
6,657 |
|
Total
current liabilities |
|
|
77,868 |
|
|
|
75,241 |
|
Senior convertible
notes |
|
|
19,065 |
|
|
|
19,099 |
|
Note payable to related
party |
|
|
72,036 |
|
|
|
72,089 |
|
Accrued interest - note
payable to related party |
|
|
7,969 |
|
|
|
6,835 |
|
Recognized loss on
purchase commitments - long term |
|
|
85,344 |
|
|
|
91,642 |
|
Deferred revenue - long
term |
|
|
15,867 |
|
|
|
10,680 |
|
Milestone rights
liability |
|
|
7,201 |
|
|
|
7,201 |
|
Operating lease
liabilities |
|
|
3,615 |
|
|
|
— |
|
Total
liabilities |
|
|
288,965 |
|
|
|
282,787 |
|
Commitments and
contingencies |
|
|
|
|
|
|
|
|
Stockholders'
deficit: |
|
|
|
|
|
|
|
|
Common stock, $0.01 par
value - 280,000,000 shares authorized, 187,778,236 and
187,029,967 shares issued and outstanding at March 31, 2019
and December 31, 2018, respectively |
|
|
1,878 |
|
|
|
1,870 |
|
Additional paid-in
capital |
|
|
2,765,020 |
|
|
|
2,763,067 |
|
Accumulated other
comprehensive loss |
|
|
(19 |
) |
|
|
(19 |
) |
Accumulated deficit |
|
|
(2,954,883 |
) |
|
|
(2,940,000 |
) |
Total
stockholders' deficit |
|
|
(188,004 |
) |
|
|
(175,082 |
) |
Total
liabilities and stockholders' deficit |
|
$ |
100,961 |
|
|
$ |
107,705 |
|
Company Contact: Rose Alinaya SVP, Investor Relations and
Treasury 818-661-5000 ir@mannkindcorp.com
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