MannKind Corporation Reports Fourth Quarter and Full Year 2008 Financial Results

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VALENCIA, Calif., Feb 17, 2009 /PRNewswire via COMTEX/ -- - Conference Call to Begin Today at 4:00 PM ET - MannKind Corporation (Nasdaq: MNKD) today reported financial results for the fourth quarter and year ended December 31, 2008.

For the fourth quarter of 2008, total operating expenses were $81.8 million, compared to $79.1 million for the fourth quarter of 2007. Research and development (R&D) expenses increased by $2.0 million to $68.8 million for the fourth quarter of 2008 compared to the fourth quarter of 2007. This increase is primarily due to higher manufacturing costs (including clinical supplies) for AFRESA®, offset in part by lower purchased services in the associated clinical development program, and lower technology agreement costs in our oncology research programs. General and administrative (G&A) expenses increased by $0.7 million to $13.0 million for the fourth quarter of 2008 compared to the fourth quarter of 2007.

The net loss applicable to common stockholders for the fourth quarter of 2008 was $83.3 million, or $0.82 per share based on 101.8 million weighted average shares outstanding, compared with a net loss applicable to common stockholders of $75.0 million, or $0.75 per share based on 99.6 million weighted average shares outstanding, for the fourth quarter of 2007.

For the year ended December 31, 2008, total operating expenses were $305.8 million, compared with $307.4 million for 2007. R&D expenses were $250.4 million in 2008, down $6.4 million from 2007, primarily related to lower technology agreement costs in our oncology research programs and decreased clinical development program expenses, which were offset by increases in manufacturing costs (including clinical supplies) for AFRESA and associated clinical development program expenses. G&A expenses increased by $4.8 million to $55.3 million for 2008 as compared to 2007 primarily due to salaries and stock compensation expenses. The total number of employees decreased from 609 at the end of 2007 to 580 at the end of 2008.

The net loss applicable to common stockholders for 2008 was $303.0 million, or $2.98 per share based on 101.6 million weighted average shares outstanding, compared with a net loss applicable to common stockholders of $293.2 million, or $3.66 per share based on 80.0 million weighted averages shares outstanding for 2007. The number of common shares outstanding at December 31, 2008 was 102,008,096.

Cash, cash equivalents and marketable securities were $46.5 million at December 31, 2008, $95.2 million at September 30, 2008, and $368.3 million at December 31, 2007. Currently, the Company has additional financial resources of $320.0 million available under the loan arrangement with our principal stockholder.

"Our NDA for AFRESA is now almost finished," stated Alfred Mann, Chairman and Chief Executive Officer. "Little more than the hyperlinking of the electronic submission remains to be completed. Our clinical, regulatory and CMC teams have done an extraordinary job assembling a comprehensive document that describes the robust safety and efficacy data that we have collected for AFRESA. The extensive clinical program that we conducted has provided evidence that AFRESA consistently decreases A1C levels and additionally offers marked benefits for patients in terms of post-prandial glucose control, fasting glucose control, weight loss and hypoglycemia. Moreover, the studies indicate that AFRESA achieves these clinical benefits without any adverse effects on pulmonary function. We look forward to the year ahead as we transition from the development of AFRESA into commercial readiness."

Conference Call

MannKind management will host a conference call to discuss these results today at 4:00 PM ET. To participate in the call, please dial (888) 677-5721 or (210) 839-8507. To listen to the call via the internet, please visit http://www.mannkindcorp.com. The web site replay will be available for 14 days. A telephone replay will be accessible for approximately 14 days following completion of the call by dialing (800) 756-2759 or (402) 998-0791.

Presenting from the Company will be:

  • Chairman and Chief Executive Officer Alfred Mann
  • President and Chief Operating Officer Hakan Edstrom
  • Corporate Vice President and Chief Financial Officer Matthew Pfeffer
  • Corporate Vice President and Chief Scientific Officer Peter Richardson

About MannKind Corporation

MannKind Corporation (Nasdaq: MNKD) focuses on the discovery, development and commercialization of therapeutic products for patients with diseases such as diabetes and cancer. Its pipeline includes AFRESA, which has completed Phase 3 clinical trials, and MKC253, which is currently in Phase 1 clinical trials. Both of these investigational products are being evaluated for their safety and efficacy in the treatment of diabetes. MannKind maintains a website at http://www.mannkindcorp.com to which MannKind regularly posts copies of its press release as well as additional information about MannKind. Interested persons can subscribe on the MannKind website to email alerts that are sent automatically when MannKind issues press releases, files its reports with the SEC or posts certain other information to the website.

Forward-Looking Statements

This press release contains forward-looking statements, including statements related to differentiating AFRESA from other insulins. Words such as "believes," "anticipates," "plans," "expects," "intend," "will," "goal," "potential" and similar expressions are intended to identify forward-looking statements. These forward-looking statements are based upon MannKind's current expectations and involve risks and uncertainties. Actual results and the timing of events could differ materially from those anticipated in such forward-looking statements as a result of these risks and uncertainties, which include, without limitation, risks related to the progress, timing and results of clinical trials, difficulties or delays in seeking or obtaining regulatory approval, and other risks detailed in MannKind's filings with the Securities and Exchange Commission, including the Annual Report on Form 10-K for the year ended December 31, 2007 and periodic reports on Form 10-Q and Form 8-K. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. All forward-looking statements are qualified in their entirety by this cautionary statement, and MannKind undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date of this press release.

                                (Tables to follow)



                                MannKind Corporation
                           (A Development Stage Company)
                         Condensed Statements of Operations
                                    (Unaudited)
                       (In thousands, except per share amounts)

                                                                  Cumulative
                                                                 period from
                                                                 February 14,
                              Three months       Twelve months   1991 (date of
                                  ended              ended       inception) to
                               December 31,       December 31,    December 31,
                             2008      2007      2008      2007       2008

    Revenue                    $-        $-       $20       $10      $2,988
    Operating
     expenses:
      Research and
       development         68,777    66,751   250,442   256,844     997,482
      General and
       administrative      12,978    12,316    55,343    50,523     245,842
      In-process
       research and
       development costs        -         -         -         -      19,726
      Goodwill
       impairment               -         -         -         -     151,428
        Total operating
         expenses          81,755    79,067   305,785   307,367   1,414,478
    Loss from
     operations           (81,755)  (79,067) (305,765) (307,357) (1,411,490)
    Other expense             (55)     (355)      (62)     (197)     (1,943)
    Interest expense
     on note payable
     to principal
     stockholder              (12)        -       (12)        -      (1,523)
    Interest expense
     on senior
     convertible notes     (1,742)     (584)   (2,327)   (3,408)     (5,957)
    Interest income           271     4,996     5,129    17,775      36,861
    Loss before
     provision for
     income taxes         (83,293)  (75,010) (303,037) (293,187) (1,384,052)
    Income taxes               (2)       (3)       (2)       (3)        (26)
    Net loss              (83,295)  (75,013) (303,039) (293,190) (1,384,078)
    Deemed dividend
     related to
     beneficial
     conversion
     feature of
     convertible
     preferred stock            -         -         -         -     (22,260)
    Accretion on
     redeemable
     preferred stock            -         -         -         -        (952)
    Net loss
     applicable to
     common
     stockholders        $(83,295) $(75,013)$(303,039)$(293,190)$(1,407,290)
    Net loss per
     share applicable
     to common
     stockholders -
     basic and diluted     $(0.82)   $(0.75)   $(2.98)   $(3.66)
    Shares used to
     compute basic and
     diluted net loss
     per share
     applicable
     to common
     stockholders         101,758    99,605   101,561    80,038



                               MannKind Corporation
                           (A Development Stage Company)
                              Condensed Balance Sheet
                                    (Unaudited)
                                  (in thousands)

                                              December 31,     December  31,
                                                 2008              2007
    Assets
    Current assets:
      Cash and cash equivalents                 $27,648          $368,285
      Marketable securities                      18,844                 -
      State research and development
       credit exchange receivable - current       1,500               831
      Prepaid expenses and other
       current assets                             5,983             9,596
    Total current assets                         53,975           378,712
    Property and equipment - net                226,436           162,683
    State research and development
     credit exchange receivable - net
     of current portion                           1,500             1,500
    Other assets                                    548               548
    Total                                      $282,459          $543,443

    Liabilities and Stockholders' Equity

    Current liabilities                         $53,472           $67,558
    Senior convertible notes                    112,253           111,761
    Note payable to principal stockholder        30,000                 -
    Other liabilities                                 -                24
    Stockholders' equity                         86,734           364,100
    Total                                      $282,459          $543,443

SOURCE MannKind Corporation

http://www.mannkindcorp.com

MNKD

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