JMP: MannKind Investors Need 'Clarity'

JMP’s Jason N. Butler reiterated a Market Perform rating on MannKind Corporation (NASDAQ: MNKD), while noting that “Afrezza remains in limbo as we await clarity on the commercialization plan and funding options.”

Earnings Miss

The company reported its 4Q15 earnings below the estimates and consensus, driven primarily by impairment charges associated with Afrezza.

Butler pointed out that MannKind ended 4Q15 with cash of $59 million, apart from $30 million that is under the loan arrangement with the Mann Group.

The company ended 4Q15 with $59MM in cash, not including $30MM remaining under the loan arrangement with the Mann Group.

Management Announced

MannKind has also announced the hiring of Michael Castagna as its new CCO, along with resignation of COO Juergen Martens.

“Management reiterated plans to market Afrezza itself after receiving the rights back from Sanofi SA (ADR) (NYSE: SNY) on April 5, and anticipates detailing its commercialization strategy at that time,” the JMP report said.

Insufficient Cash?

Butler also mentioned that the 2016 guidance indicates lower R&D spend, with higher selling expenses. However, if there is no improvement in Afrezza sales, and if the Mann facility is “not drawn upon”, management believes that the cash would be adequate only through 2H16.