MannKind gained 26 cents, or 3.3 percent, to $8.23, at 4 p.m. New York time in Nasdaq Stock Market composite trading, the biggest gain since Dec. 14. The FDA isn’t able to meet tomorrow’s scheduled deadline for action on the diabetes drug, Afrezza, and will need about four more weeks to complete its evaluation, MannKind said today in a statement.
Today’s delay burned some investors betting against the stock, and they may be covering short sales by buying shares, said Les Funtleyder, a manager at Miller Tabak & Co. in New York. MannKind, based in Valencia, California, failed to win approval March 15 when the FDA asked for updated safety data.
“There was a lot of anticipation going into this outcome,” Funtleyder said today in a telephone interview. “There may be a few investors who think that a delay, as opposed to an outright denial, can be taken as a positive. But the FDA has been taking more time with things, and perhaps they just needed more time.”
MannKind aims to have the only inhaled insulin on the market for more than 20 million Americans and 170 million people worldwide with diabetes. Jon LeCroy, an analyst for Hapoalim Securities in New York, said he is skeptical of the company’s prospects for gaining approval.
“The FDA remains extremely risk averse,” LeCroy said in a note to investors on Dec. 17. “We think this is a major problem for Afrezza.”
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