VALENCIA, Calif., Nov. 5 MannKind Corporation(Nasdaq: MNKD) today reported financial results for the third quarter endedSeptember 30, 2008.
For the third quarter of 2008, total operating expenses were $69.1million, compared to $75.6 million for the third quarter of 2007, primarilyattributable to the $9.2 million reduction in research and development (R&D)expenses which totaled $55.6 million for this quarter compared to $64.8million for the same quarter in 2007. The decrease in R&D expenses for thethree months ended September 30, 2008 as compared to the same period in theprior year was primarily due to decreased costs associated with the clinicaldevelopment of AFRESA(TM) (formerly identified as the Technosphere InsulinSystem) and the related manufacturing costs associated with clinical trialmaterials, partially offset by increased stock-based compensation expense andincreased facilities-related expenses. General and administrative (G&A)expenses increased by $2.7 million to $13.4 million for the third quarter of2008 compared to the third quarter of 2007. G&A expenses for the three monthsended September 30, 2008 increased as compared to the same period in the prioryear primarily due to increased employee-related and consulting expenses andincreased stock-based compensation expense.
For the first nine months of 2008, operating expenses totaled $224.0million, compared to $228.3 million in the first nine months of 2007. R&Dexpenses for the first nine months were $181.7 million, compared to $190.1million in 2007. The decrease in R&D expenses for the nine months endedSeptember 30, 2008, as compared to the same period in the prior year wasprimarily due to decreased costs associated with the clinical development ofAFRESA and the related manufacturing costs associated with clinical trialmaterials, partially offset by increased stock-based compensation expense andincreased facilities-related expenses. G&A expenses increased by $4.2 millionto $42.4 million for the first nine months of 2008 as compared to the sameperiod in 2007. G&A expenses for the nine months ended September 30, 2008increased as compared to the same period in the prior year primarily due toincreased employee-related and consulting expenses and increased stock-basedcompensation expense, offset by decreased professional fees.
We anticipate that our R&D expenses associated with AFRESA will continueto decline as we close out our pivotal clinical studies and completepreparations for the filing of our New Drug Application ("NDA") with the U.S.Food and Drug Administration ("FDA"). We expect G&A expenses, other than non-cash stock-based compensation expense, to remain constant in the future.
The net loss for the third quarter of 2008 was $68.5 million, or $0.67 pershare, based on 101.6 million weighted average shares outstanding. Thiscompares to a net loss of $73.0 million, or $0.99 per share, based on 73.5million weighted average shares outstanding for the third quarter of 2007.The net loss for the first nine months of 2008 was $219.7 million, or $2.17per share based on 101.5 million shares outstanding, compared with a net lossof $218.2 million, or $2.97 per share based on 73.4 million sharesoutstanding, for the first nine months of 2007.
Cash and cash equivalents and marketable securities were $95.2 million atSeptember 30, 2008, $180.5 million at June 30, 2008, and $368.3 million atDecember 31, 2007.
"MannKind has made great progress this quarter," commented Alfred Mann,Chairman and Chief Executive Officer. "Our pivotal trials are completed andwe are well along in preparation of the AFRESA NDA submission to the FDA. Wehave completed and dedicated our new manufacturing facility and equipped itwith the first stage of the modular production systems that will be used tosupply commercial product. The emerging data support our belief that AFRESAwill be a very important prandial insulin for most people with type 1 and type2 diabetes. We will soon be ready to reinitiate discussions with potentialpartners."
MannKind management will host a conference call to discuss these resultstoday at 9:00 a.m. Eastern Time. To participate in the call please dial (888)677-5721 or (210) 839-8507. To listen to the call via the Internet pleasevisit http://www.mannkindcorp.com. The web site replay will be available forfourteen days. A telephone replay will be accessible for approximately 14days following completion of the call by dialing (866) 411-1707 or (203) 369-0654 and entering conference number 4423761.
MannKind Corporation (Nasdaq: MNKD) focuses on the discovery, developmentand commercialization of therapeutic products for patients with diseases suchas diabetes and cancer. Its pipeline includes AFRESA, which has completedPhase 3 clinical trials, and MKC253, which is currently in phase 1 clinicaltrials. Both of these investigational products are being evaluated for theirsafety and efficacy in the treatment of diabetes. MannKind maintains a websiteat http://www.mannkindcorp.com to which MannKind regularly posts copies of itspress release as well as additional information about MannKind. Interestedpersons can subscribe on the MannKind website to email alerts that are sentautomatically when MannKind issues press releases, files its reports with theSEC or posts certain other information to the website.
This press release contains forward-looking statements, includingstatements related to MannKind's expected R&D and G&A expenses, clinicaltrials, product candidates, regulatory submissions, manufacturing facility andpartnership opportunities that involve risks and uncertainties. Words such as"believes", "anticipates", "plans", "expects", "intend", "will", "goal","potential" and similar expressions are intended to identify forward-lookingstatements. These forward-looking statements are based upon the Company'scurrent expectations. Actual results and the timing of events could differmaterially from those anticipated in such forward-looking statements as aresult 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, themanufacture of AFRESA, competition from other pharmaceutical or biotechnologycompanies, MannKind's ability to enter into any collaborations or strategicpartnerships, intellectual property matters, stock price volatility and otherrisks detailed in MannKind's filings with the Securities and ExchangeCommission, including the Annual Report on Form 10-K for the year endedDecember 31, 2007 and periodic reports on Form 10-Q and Form 8-K. You arecautioned not to place undue reliance on these forward-looking statements,which speak only as of the date of this press release. All forward-lookingstatements are qualified in their entirety by this cautionary statement, andMannKind undertakes no obligation to revise or update any forward-lookingstatements to reflect events or circumstances after the date of this pressrelease.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
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