Leerink Partners sets Outperform rating on MannKind on growth avenues By Investing.com

Leerink Partners has initiated coverage on shares of MannKind (NASDAQ:) Corporation (NASDAQ: MNKD), assigning an Outperform rating and setting a price target of $8.00. The firm anticipates multiple avenues for potential additional value creation beyond the company’s existing base business and robust royalty stream.

MannKind, recognized for its leadership in the development of inhaled therapies, benefits from a 9% royalty on net sales from Tyvaso DPI, a product developed in collaboration with United Therapeutics (NASDAQ:), which is annualizing at more than $1 billion as of the second quarter of 2024.

MannKind’s pipeline, which focuses on orphan lung diseases, also presents opportunities for growth. The firm highlights MNKD-101, an inhaled formulation of clofazimine currently in a Phase 3 study for non-tuberculous mycobacterium (NTM) lung infection.

The known activity of clofazimine in treating NTM and the success of inhaled formulations of known antibiotics for this condition suggest that the development of MNKD-101 is partially de-risked.

In addition to MNKD-101, MannKind is working on MNKD-201, an inhaled anti-fibrotic for idiopathic pulmonary fibrosis (IPF), which could also contribute to the company’s growth. The company’s existing diabetes products, Afrezza (inhaled insulin) and V-Go (insulin delivery patch), though generating modest sales, are commercially profitable and could see a positive sales inflection based on potential label expansion to include pediatric use.

MannKind reported record revenues of $72 million for the second quarter of 2024, a substantial increase from the previous year, driven by the performance of its lead products, Tabesa DPI and Afrezza.

Despite a GAAP net loss of $2 million, primarily due to an accounting charge from early debt repayment, MannKind maintains a strong balance sheet with $262 million in cash and investments.

Additionally, Oppenheimer has raised the price target for MannKind to $12.00, following a review of recent developments concerning the potential market expansion of TYVASO for treating idiopathic pulmonary fibrosis (IPF). The drug’s expansion into this new indication could result in an estimated $5 billion in peak sales by the year 2033.

In terms of leadership, the pharmaceutical company has seen a change in its board of directors as Kent Kresa, a long-standing member, retired and Steven B. Binder, currently serving as the Executive Vice President of Special Projects, was appointed to the board.

InvestingPro Insights

As we consider MannKind Corporation’s (NASDAQ:MNKD) prospects in light of Leerink Partners’ positive outlook, InvestingPro data and tips provide additional context for investors. MannKind’s market capitalization stands at approximately $1.73 billion, reflecting a significant player in the pharmaceutical industry. Notably, the company’s revenue has shown impressive growth over the last twelve months as of Q2 2024, with an increase of 57.08%, signaling strong market demand for its products.

InvestingPro Tips suggest that MannKind is expected to continue this upward trajectory, with net income forecasted to grow this year. Additionally, the company’s liquid assets exceed its short-term obligations, indicating a solid financial position to support ongoing operations and development efforts. These factors may contribute to the firm’s Outperform rating and the ambitious $8.00 price target. For investors seeking a more comprehensive analysis, there are additional InvestingPro Tips available, including insights into MannKind’s valuation multiples and profitability forecasts.

Moreover, the company’s stock has been trading near its 52-week high, with a price 96.82% of that peak, which could be a testament to investor confidence and market performance. For those interested in exploring all facets of MannKind’s financial health and market potential, InvestingPro offers a broader range of tips and metrics that could further inform investment decisions.

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