MannKind Corporation (NASDAQ:MNKD) has announced that it has received a total of $1 million, from Receptor Life Sciences Inc. The company stated that the payment has been made upon completion of a milestone. The two companies have been collaborating under a license agreement, which entitles MannKind to payments, upon successful completion of certain milestones. The most recent payment was made for the successful completion of the initial formulation.
The CEO of MNKD, Matthew J. Pfeffer, claimed that the results were a validation of how versatile the company’s formulation technology is. He further expressed his pleasure at the progress being made by the company and stated that he looks forward to achieving the next milestone soon. It should be noted here that this was the first update from MannKind, which has been silent for approximately 2-months. The company last made a press release when it announced that it had entered into an agreement with Sanofi on Afrezza.
Under the terms of the agreement with Sanofi, MNKD agreed to terminate its security agreement and promissory note with Aventisub LLC, an affiliate of Sanofi. Added to this, Aventisub also agreed to forgive a loan of $71.56 million, in full. Furthermore, Sanofi also agreed to purchase a total of $10.2 million worth of insulin from the company, by early December. Moreover, Sanofi is also required to pay MannKind a sum of $30.6 million, by January 9, 2017, as part of a put option exercisable by MNKD.
It should be noted here that MannKind and Sanofi had been previously collaborating under a licensing agreement, which was terminated. The aforementioned agreement was a result of this termination, resulting in the resolution of supply, resolution and licensing agreement and the transition agreement. Given how the agreement with Sanofi came to an abrupt end, investors seem to be very cautious about MNKD. This could be one of the reasons why the encouraging press release from MannKind failed to have a positive impact on the share price, during yesterday’s trading session.
MannKind Corporation (NASDAQ:MNKD) closed at a share price of $0.631, at the end of the January 3 trading session, 0.83% lower than the session before.