Despite a more than 200-percent gain in MannKind Corporation MNKD's stock over the past month alone analysts at H.C. Wainwright see even further upside ahead. The firm's Oren Livnat initiates coverage of MannKind's stock with a Buy rating and $7 price target, which represents a gain of more than $1 per share from Tuesday's opening price of $5.89 (see Livnat's track record here).
After spending more than $2 billion over two decades developing the only approved inhaled and rapid-acting insulin therapy for diabetes called Afrezza, MannKind went on to secure a "blockbuster" partnership with Sanofi SA (ADR) SNY. However, since then a "disappointing partner launch" resulted in Afrezza being returned in 2016 and the stock plummeted 98 percent from peak to trough.
Meanwhile, Wall Street "largely wrote off" Afrezza and MannKind's stock but this perception could change under a new management team and a "game-changing" new label, which was approved last week, the analyst continued. Specifically, Afrezza could gain traction in the "very large" insulin space and prove to be the "significant product that its innovation merits."
"We believe Afrezza inhaled insulin is a clearly differentiated meal-time insulin therapy vs. injectable market leaders Novolog and Humalog, which combine for $3.5B in the U.S.," the analyst explained. "Besides the apparent advantages of a more convenient and less stigmatizing puff on an inhaler at meal-time vs. injections, the even greater value of Afrezza is its inherent "faster in, faster out" pharmacodynamics (PD), which more closely mimic endogenous insulin in healthy people. Faster in and out means that it should better control glucose at meal-time and lower risk of delayed hypoglycemia, which is the biggest risk of insulin therapy."
Bottom line, MannKind will evolve from being "knocked out to take out" by a larger player as the company accelerates Afrezza's growth and achieve peak sales of more than $725 million in the U.S.
At time of publication, shares of MannKind were up 26.08 percent at $6.72.
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