MannKind Up 20% On Diabetes Deal With Sanofi

Shares of MannKind (NASDAQ: MNKD) are up more than 18 percent in pre-market trading. This move is on the back of the announcement by MannKind that Sanofi has entered into a development deal for Afrezza, an inhaled insulin treatment.

In the deal, MannKind will receive an upfront payment of $150 million, with possibly an additional $775 million in further payments based on milestones.

The deal is structured with MannKind to get 35 percent of the profits while Sanofi is set to get 65 percent of profits on Afrezza.

Piper Jaffray holds a Neutral rating on MannKind and said the Sanofi partnership is "impressive," though they remain on sidelines. The firm is "not as bearish" as short sellers on potential for Afrezza to succeed commercially.

Afrezza was approved by the FDA just seven weeks ago.