MannKind Corporation (NASDAQ: MNKD) is dipping a bit in the market after a multi-session gain more than doubled the value of the stock from Tuesday through Wednesday. With the dip in mind, some are starting to wonder if now is the time to invest in the stock. Today, we’ll talk about:
- Why the stock had such a strong start to the week;
- whether or not now is the time to invest in MNKD;
- what we’re seeing from the stock today; and
- what we’ll be watching for ahead.
Why MNKD More Than Doubled Earlier This Week
As mentioned above, MannKind had an incredible start to the week following the Labor Day holiday. The gains came for good reason too. The company has been struggling due to poor sales of its only approved treatment, Afrezza. With concerns surrounding the company’s financial position, it has been sitting at the bottom of the barrel for some time.
That is, until United Therapeutics (UTHR) contracted with the company on Tuesday. In a press release issued Tuesday, UTHR announced that it would be entering into a collaboration with MNKD surrounding the treatment of PAH. The agreement surrounded the development of a treatment for the condition that uses MannKind’s proprietary technosphere technology, allowing the treatment to be inhaled rather than delivered by other means.
Importantly, the agreement came with an initial payment to MNKD in the amount of $45 million. On top of the upfront payment, the company will be eligible to receive up to $50 million in development, regulatory and commercial milestone payments as well as double-digit royalties, should the drug be approved.
Of course, this was great news for the struggling biotechnology company. The immediate injection of funds and promise of further fund injections down the line set the company on stronger financial footing. Ultimately, it was this deal that led the stock from around $1.10 per share before the open of the week to more than $2.80 per share by mid-day Wednesday.
Is Now The Time To Get Involved?
This is a tough question to answer. However, in my opinion, the answer is yes. I have been following MannKind for some time now, and while I haven’t been impressed with Afrezza sales, I have been impressed with what the drug represents. Afrezza is the first insulin that is inhaled by patients, rather than injected. The ability to do so stems from the company’s proprietary technosphere technology.
Since learning about the technology MNKD developed, I’ve always viewed it as valuable. With UTHR now investing in that technology, this view has largely been validated. While it will take some time to develop new treatments using technosphere, I believe that the technology represents a long-term opportunity for potentially serious gains.
What We’re Seeing From The Stock
Since the close of Wednesday, MannKind has been dipping in the market a bit, losing 6.85% on Thursday and starting in the red today. At the moment (8:06), MNKD is trading at $2.03 per share after a loss of $0.0099 per share or 0.49% thus far today.
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What We’ll Be Watching For Ahead
Moving forward, the CNA Finance team will continue to keep a close eye on MNKD. In particular, we’re interested in following the company’s development of the new PAH product with UTHR. We’re also interested in seeing how the company uses the funds from this collaboration and what the company does in the future to further validate and take advantage of their technosphere technology. Finally, we’ll be watching Afrezza sales for any positive surprises that may arise. Nonetheless, we’ll continue to follow the story closely and bring the news to you as it breaks!
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