MannKind Corp.’s inhaled diabetes treatment won the backing of a panel of U.S. regulatory advisers, boosting the company’s long-running effort to get its first product on the market. Shares more than doubled in extended trading Tuesday after the panel’s recommendation.
Advisers to the Food and Drug Administration voted 13-1 and 14-0 that the drug, Afrezza, should be approved for Type 1 and Type 2 diabetes, respectively. The FDA doesn’t have to follow the panel’s recommendation. FDA staff raised concerns in a report March 28 that the drug may affect lung function and about missing data from a study on Type 1 diabetes patients.
Afrezza would compete with Indianapolis-based Eli Lilly and Co.’s Humalog and Novo Nordisk A/S’s Novolog, both injected insulins. Novolog generated $3 billion in sales last year and Humalog brought in $2.6 billion, according to data compiled by Bloomberg. Many diabetics begin treatment on an older drug called metformin, a pill which can lose effectiveness over time.
MannKind has spent more than seven years trying to gain approval. The FDA rejected the drug twice, most recently in 2011, after the Valencia, Calif.-based company decided to switch inhalers during the review process.
While some panel members who recommended approval expressed reservations about potential safety risks, they said MannKind demonstrated the drug works. The advisers also said the benefit of an alternative to insulin injections outweighed their concerns or could be addressed in the medicine’s labeling
If approved, Afrezza may generate $534 million in 2018, according to the average estimate of three analysts compiled by Bloomberg. The FDA is expected to decide whether to clear the drug for sale by April 15.
MannKind shares more than doubled, to $9.31 each, in after-market trading after being halted during the day for the panel’s meeting. The company declined five straight days leading to the meeting, including a 17-percent drop Monday, to $4.02, the biggest single-day fall since October 2012, as investors were concerned the panel may react negatively to the drug.
“We are pleased with the advisory committee’s approval recommendation in support of Afrezza, and we appreciate the thoroughness of their review,” Alfred Mann, chairman and CEO, said in a prepared statement. “Diabetes is a major health problem in the United States, and we are committed to bring Afrezza to the many patients who might benefit from this novel product.”
About 26 million people in the U.S. had diabetes in 2010, or 8.3 percent of the population, according to the Centers for Disease Control and Prevention. The condition, which is caused when the body doesn’t use insulin properly or doesn’t make the hormone, is the seventh-leading cause of death in the U.S. Insulin is a hormone secreted by the pancreas that helps the body control blood sugar. Type 2 accounts for 90 percent to 95 percent of diabetes cases in the U.S.
Pfizer Inc. made the only other inhaled insulin, Exubera, approved in 2006. The New York-based drugmaker pulled the product after sales were lower than expected, according to the FDA staff report. The drug was associated with a higher risk of lung cancer because insulin is directly deposited in the lungs and the drug is a growth factor. FDA staff said this may be a concern with Afrezza as well.
FDA staff suggested two post-market studies to evaluate lung-cancer risk.
Lilly tried to produce an inhaled insulin of its own, but abandoned the effort in 2008 after spending tens of millions of dollars on the effort.
Lilly shares fell 11 cents in after-market trading, to $58.71 each, after dropping 4 cents Tuesday during regular market hours.