MannKind Corp. intends to use proceeds from a $50 million Series C round of financing to bankroll ongoing development of Technosphere Insulin, a Phase IIb candidate for the treatment of Type II diabetes.
Located in Valencia, Calif., the privately-held firm raised the money through the private placement of 980,392 shares of a newly created class Series C convertible preferred stock sold to selected institutional and private investors. The stock is convertible into about 9.9 million shares of MannKind common stock at a price of $5.10 per share, subject to certain adjustments and antidilution provisions. No mandatory dividends are payable on the Series C preferred stock. Cash and investment securities at the completion of the private placement totaled about $64 million.
Company officials declined comment.
MannKind is focused on therapeutic products for diabetes, cancer, and inflammatory and autoimmune diseases. Its lead candidate is based on its Technosphere technology, which is designed to provide alternatives for noninvasive pulmonary drug delivery of therapeutic agents that currently require invasive administration. The Technosphere Insulin System includes the Technosphere dry-powder formulation of insulin and the MedTone inhaler.
In a prepared statement, Hakan Edstrom, MannKind's president and chief operating officer, said that if approved, Technosphere Insulin, would be the first pulmonary insulin system to produce a profile of insulin levels in the bloodstream that is similar to what is seen in healthy individuals following the beginning of a meal.
"Approximating this first-phase insulin release spike may allow patients to achieve greater control over their glucose levels, which we expect may reduce exhaustion of the insulin-secreting cells in the pancreas and possibly also reduce the degree of insulin resistance," he said.