MannKind Corporation (NASDAQ: MNKD) is having yet another strong day in the market today following news that the FDA has approved new labeling for Afrezza. We covered this news in detail when it took place. However, I’ve received a few emails asking what the big deal was surrounding the label. So today, we’ll talk about the benefits of the label change. Before we do, I’d like to give a big thank you to our partners at Trade Ideas for being the first to alert us to the gains. At the moment (11:29), MNKD is trading at $3.36 per share after a gain of $0.54 per share (19.15%) thus far today.
FDA Label Changes Will Help Representatives Sell Afrezza
First and foremost, the new label changes are like a breath of fresh air for MannKind’s sales representatives. That’s because these changes will likely make it easier for these representatives to sell the product. In particular, the label changes include specific instructions on how the treatment should be used for the best results in patients. Ultimately, prescribers need this information to make better decisions for their patients. Considering that the label goes into detail with instructions, what patients should expect to feel, the timing of peak effects, duration of the drug, and when the patient should expect to return to the baseline levels for different dosage units, prescribers will be better equipped to prescribe the treatment, making the job of the sales representatives a much easier one.
New Label Changes Are Likely To Lead To A Higher Refill Rate
Another key benefit that MNKD is likely to see as the result of the label changes is a higher refill rate. In the past, the label for Afrezza didn’t go into as much detail with regard to instructions for different individual cartridge units. In fact, instructions were relatively vague. However, those who use Afrezza now have detailed instructions, which will likely lead to a better user experience.
Due to the lack of direction, refill rates on Afrezza in the past were relatively low. In fact most people that gave Afrezza a trial run simply didn’t go back to refill the product when the trial pack was finished. However, with the new labeling, patients are likely to be more confident in what they are doing with the treatment, and as a result, enjoy using the treatment. As such, it’s likely that the new label for Afrezza will lead to a stronger refill rate.
Putting It Together
At the end of the day, the instructions offered on the new label give prescribers a better understanding of what they should be prescribing and how it should be used. As a result, we’re likely to see more new prescriptions out of Afrezza, helping to give MNKD a boost. Considering that these instructions will also likely lead to a better experience for the end user, the refill rate on Afrezza is likely going to be quite a bit stronger as well, providing the company with yet another boost.
At the end of the day, this label change isn’t simply a how to, it’s a godsend for MNKD. The company now not only has the gun, but they have the ammunition that goes with it. As such, I’m expecting to see strong sales coming down the line relatively soon. Of course, stronger sales means stronger revenue and stronger earnings, all equating to growth in the value of the stock.
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What We’ll Be Watching For Ahead
Moving forward, the CNA Finance team will be keeping a close eye on MNKD. In particular, we’re interested in following Afrezza sales reports after the positive label changes approved by the FDA. Nonetheless, we’ll continue to follow the story closely and bring the news to you as it breaks!
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