United Therapeutics’ (UTHR) Tyvaso’s CRL is a Second Chance for Mannkind (MNKD) Investors – Analyst

October 18, 2021 12:09 PM EDT
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Price: $4.42 +2.31%

Rating Summary:
    8 Buy, 3 Hold, 6 Sell

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Today's Overall Ratings:
    Up: 8 | Down: 8 | New: 71
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Earlier today, MannKind Corporation (Nasdaq: MNKD) has learned that the U.S. Food and Drug Administration (FDA) issued a complete response to United Therapeutics Corporation (NASDAQ: UTHR) regarding the New Drug Application (NDA) for Tyvaso DPI™ for the treatment of pulmonary arterial hypertension (PAH) and pulmonary hypertension associated with interstitial lung disease (PH-ILD).

The FDA declined to approve the NDA at this time, noting only one deficiency related to an open inspection issue at a third-party analytical testing center for treprostinil drug substance, the active ingredient of Tyvaso DPI. The complete response did not pertain to MannKind, and no issues were cited by the FDA as it relates to MannKind’s facility in Connecticut for manufacturing, testing and packaging of finished Tyvaso DPI, including its associated device.

Following up on the announcement, Cantor Fitzgerald analyst Brandon Folkes believes “it to be a minor setback for MNKD.”

The analyst highlights that the disclosure shows the setback was not MNKD-related, and “the FDA was close to approving Tyvaso DPI”. He models the drug may get the final approval even earlier than UTHR’s indication of summer 2022.

He also notes that “MNKD is very well capitalized at this stage, especially following the announced the sale and leaseback of the Danbury facility” and doesn’t “see any concern on liquidity or financing overhang on the approval delay.”

Based on all the above, the analyst remains bullish on the stock and expects that “upward earnings revisions to forecasts for MNKD's commercial product, and pipeline readouts, should drive the stock higher.”

Cantor Fitzgerald maintains an “Overweight” rating on the shares and $6.50 Price Target.

MNKD is trading nearly 19% lower following the announcement.

Written by Vlad Schepkov | Vlad@StreetInsider.com

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