MannKind Corporation (Nasdaq:MNKD) today reported
financial results for the quarter ended March 31, 2021.
“We started 2021 by taking advantage of
favorable market conditions to strengthen our financial position
with the issuance of $230 million of senior convertible notes,
which provides our current and future partners with greater
confidence in our company,” said Michael Castagna, Chief Executive
Officer of MannKind Corporation. “The capital raised allows us to
reduce our legacy debt, advance our pipeline and grow Afrezza. In
the first quarter of 2021, the underlying demand for paid Afrezza
prescriptions grew in the mid-single digits year over year.”
Total revenues were $17.4 million for the first
quarter of 2021, an increase of $1.2 million, or 7%, reflecting
Afrezza net revenue of $8.1 million and collaboration and services
revenue of $9.3 million. Afrezza net revenue increased 1% compared
to $8.0 million in the first quarter of 2020. Collaboration and
services revenue for the first quarter of 2021 increased $1.1
million compared to the first quarter of 2020, primarily due to
additional pass-through costs associated with the UT license
agreement and the launch of the Vista Pharma Co-promotion Agreement
for Thyquidity.
Afrezza gross profit for each of the first
quarters of 2021 and 2020 was $3.8 million. Cost of goods sold
increased by $0.2 million compared to the same period in 2020,
which was offset by the increase in net revenues discussed
above. Gross margin in the first quarter of 2021 was 47%
compared to 48% for the same period in 2020.
Research and development expenses for the first
quarter of 2021 were $2.4 million compared to $1.8 million for the
first quarter of 2020. This increase of $0.7 million, or 39%, was
attributable to personnel costs primarily related to increased
headcount for research and development, regulatory and medical
affairs.
Selling, general and administrative expenses for
the first quarter of 2021 were $17.4 million compared to $14.4
million for the first quarter of 2020. This increase of $3.1
million, or 21%, was primarily due to a $2.3 million increase in
personnel costs primarily related to increased headcount for our
Afrezza commercial team, $0.3 million in patient support services
and $0.3 million in promotional and marketing activities.
For the first quarter of 2021, the gain on
foreign currency translation for insulin purchase commitments
denominated in Euros was $3.8 million compared $1.8 million for the
first quarter of 2020. The fluctuation was due to the change in the
U.S. dollar to Euro foreign exchange rate. Interest expense on debt
for the first quarter of 2021 was $6.5 million compared to $2.3
million for the first quarter of 2020. This increase of $4.1
million was due to a $3.7 million milestone obligation that was
achieved during the quarter and interest expense from the senior
convertible notes and the MidCap credit facility.
The net loss for the first quarter of 2021 was
$12.9 million, or $0.05 per share, compared to a $9.3 million net
loss in the first quarter of 2020, or $0.04 per share. The
increased net loss of $3.6 million was primarily due to the
increase in interest expense, selling, general and administrative
expenses, and research and development expense, all of which were
partially offset by an increase in the gain on foreign currency
translation.
Cash, cash equivalents, and investments at
March 31, 2021 were $278.3 million compared to $67.0 million
at December 31, 2020. The increase in cash, cash equivalents and
investments was primarily due to the issuance of $230.0 million of
2.5% senior convertible notes.
Debt Reductions Subsequent to March 31,
2021
In April 2021, the Company repaid $35.1 million
outstanding principal under the Mann Group non-convertible
promissory note plus $4.9 million of accrued and unpaid interest to
the Mann Group. In addition, the Company repaid $10.0 million
outstanding principal under the MidCap credit facility.
Conference Call
MannKind will host a conference call and
presentation webcast to discuss these results today at 5:00 p.m.
Eastern Time. Those interested in listening to the conference call
live via the Internet may do so by visiting the Company's website
at www.mannkindcorp.com under Events & Presentations. A
replay will 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 endocrine and orphan lung diseases.
MannKind is currently commercializing Afrezza® (insulin human)
Inhalation Powder, the Company’s first FDA-approved product and the
only inhaled ultra rapid-acting mealtime insulin in the United
States, where it is available by prescription from pharmacies
nationwide. Afrezza is also available by prescription in
Brazil where it is commercialized by the Company’s partner Biomm
SA. MannKind is headquartered in Westlake Village,
California, and has a manufacturing and R&D 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, 2020 and subsequent periodic reports on Form 10-Q
and current reports on Form 8-K. 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.
Tyvaso DPI is an investigational combination
product that is not approved for any use in any country. The Tyvaso
DPI tradename is pending final FDA review.
Company Contact: 818-661-5000ir@mannkindcorp.com
MANNKIND CORPORATION AND
SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE
SHEETS(Unaudited)(In thousands,
except share and per share data)
|
|
March 31, 2021 |
|
|
December 31, 2020 |
|
ASSETS |
|
|
|
|
|
|
|
|
Current
assets: |
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
247,833 |
|
|
$ |
67,005 |
|
Restricted cash |
|
|
158 |
|
|
|
158 |
|
Short-term investments |
|
|
28,962 |
|
|
|
— |
|
Accounts receivable, net |
|
|
3,573 |
|
|
|
4,218 |
|
Inventory |
|
|
5,050 |
|
|
|
4,973 |
|
Prepaid expenses and other current assets |
|
|
2,766 |
|
|
|
3,122 |
|
Total current assets |
|
|
288,342 |
|
|
|
79,476 |
|
Property
and equipment, net |
|
|
26,507 |
|
|
|
25,867 |
|
Long-term investments |
|
|
1,480 |
|
|
|
— |
|
Other
assets |
|
|
3,053 |
|
|
|
3,265 |
|
Total assets |
|
$ |
319,382 |
|
|
$ |
108,608 |
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' DEFICIT |
|
|
|
|
|
|
|
|
Current
liabilities: |
|
|
|
|
|
|
|
|
Accounts payable |
|
$ |
6,706 |
|
|
$ |
5,582 |
|
Accrued expenses and other current liabilities |
|
|
27,586 |
|
|
|
19,707 |
|
PPP loan — current |
|
|
4,670 |
|
|
|
4,061 |
|
Deferred revenue — current |
|
|
25,880 |
|
|
|
33,275 |
|
Recognized loss on purchase commitments — current |
|
|
8,274 |
|
|
|
11,080 |
|
Total current liabilities |
|
|
73,116 |
|
|
|
73,705 |
|
Senior
convertible notes |
|
|
222,855 |
|
|
|
— |
|
MidCap
credit facility |
|
|
49,406 |
|
|
|
49,335 |
|
Mann
Group promissory notes |
|
|
53,453 |
|
|
|
63,027 |
|
Accrued
interest — Mann Group promissory notes |
|
|
4,753 |
|
|
|
4,150 |
|
PPP loan
— long term |
|
|
203 |
|
|
|
812 |
|
2024
convertible notes |
|
|
— |
|
|
|
5,000 |
|
Recognized loss on purchase commitments — long term |
|
|
80,797 |
|
|
|
84,208 |
|
Operating lease liability |
|
|
869 |
|
|
|
1,202 |
|
Deferred
revenue — long term |
|
|
1,626 |
|
|
|
1,662 |
|
Milestone rights liability |
|
|
5,926 |
|
|
|
5,926 |
|
Total liabilities |
|
|
493,004 |
|
|
|
289,027 |
|
Stockholders' deficit: |
|
|
|
|
|
|
|
|
Undesignated preferred stock, $0.01 par value — 10,000,000 shares
authorized; no shares issued or outstanding as of March 31,
2021 and December 31, 2020 |
|
|
— |
|
|
|
— |
|
Common
stock, $0.01 par value - 400,000,000 shares authorized,
249,072,677 and 242,117,089 shares issued and outstanding at
March 31, 2021 and December 31, 2020, respectively |
|
|
2,491 |
|
|
|
2,421 |
|
Additional paid-in capital |
|
|
2,885,946 |
|
|
|
2,866,303 |
|
Accumulated deficit |
|
|
(3,062,059 |
) |
|
|
(3,049,143 |
) |
Total
stockholders' deficit |
|
|
(173,622 |
) |
|
|
(180,419 |
) |
Total
liabilities and stockholders' deficit |
|
$ |
319,382 |
|
|
$ |
108,608 |
|
|
|
|
|
|
|
|
|
|
MANNKIND CORPORATION AND
SUBSIDIARIES CONDENSED
CONSOLIDATED STATEMENTS OF
OPERATIONS(Unaudited)(In
thousands, except per share data)
|
Three Months
EndedMarch 31, |
|
|
2021 |
|
|
2020 |
|
Revenues: |
|
|
|
|
|
|
|
Net revenue — commercial product sales |
$ |
8,099 |
|
|
$ |
8,000 |
|
Revenue — collaborations and services |
|
9,337 |
|
|
|
8,235 |
|
Total revenues |
|
17,436 |
|
|
|
16,235 |
|
Expenses: |
|
|
|
|
|
|
|
Cost of goods sold |
|
4,315 |
|
|
|
4,164 |
|
Cost of revenue — collaborations and services |
|
3,295 |
|
|
|
3,362 |
|
Research and development |
|
2,442 |
|
|
|
1,755 |
|
Selling, general and administrative |
|
17,413 |
|
|
|
14,350 |
|
Asset impairment |
|
— |
|
|
|
1,521 |
|
Gain on foreign currency translation |
|
(3,838 |
) |
|
|
(1,796 |
) |
Total expenses |
|
23,627 |
|
|
|
23,356 |
|
Loss
from operations |
|
(6,191 |
) |
|
|
(7,121 |
) |
Other
(expense) income: |
|
|
|
|
|
|
|
Interest income |
|
3 |
|
|
|
133 |
|
Interest expense on notes |
|
(5,422 |
) |
|
|
(1,071 |
) |
Interest expense on Mann Group promissory notes |
|
(1,030 |
) |
|
|
(1,259 |
) |
Other expense |
|
(276 |
) |
|
|
(4 |
) |
Total other expense |
|
(6,725 |
) |
|
|
(2,201 |
) |
Loss
before provision for income taxes |
|
(12,916 |
) |
|
|
(9,322 |
) |
Provision for income taxes |
|
— |
|
|
|
— |
|
Net
loss |
$ |
(12,916 |
) |
|
$ |
(9,322 |
) |
Net loss
per share - basic and diluted |
$ |
(0.05 |
) |
|
$ |
(0.04 |
) |
Shares
used to compute basic and diluted net loss per share |
|
246,631 |
|
|
|
212,467 |
|
|
|
|
|
|
|
|
|
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