MANNKIND CORP [MNKD] Filings

10-Q 1 mnkd-10q_20220930.htm 10-Q mnkd-10q_20220930.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2022

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to .

Commission file number: 000-50865

MannKind Corporation

(Exact name of registrant as specified in its charter)

Delaware	13-3607736
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

1 Casper Street Danbury, Connecticut	06810
(Address of principal executive offices)	(Zip Code)

(818) 661-5000

(Registrant’s telephone number, including area code)

N/A

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading

Symbol(s)

Name of each exchange on which registered

Common Stock, par value $0.01 per share

MNKD

The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☒	Accelerated filer	☐

Non-accelerated filer	☐	Smaller reporting company	☐

		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of October 28, 2022, there were 263,195,593 shares of the registrant’s common stock, $0.01 par value per share, outstanding.

MANNKIND CORPORATION

Form 10-Q

For the Quarterly Period Ended September 30, 2022

TABLE OF CONTENTS

	Page
PART I: FINANCIAL INFORMATION	2

Item 1. Financial Statements (Unaudited)	2
Condensed Consolidated Balance Sheets: September 30, 2022 and December 31, 2021	2
Condensed Consolidated Statements of Operations: Three and nine months ended September 30, 2022 and 2021	3
Condensed Consolidated Statements of Comprehensive Loss: Three and nine months ended September 30, 2022 and 2021	4
Condensed Consolidated Statements of Stockholders’ Deficit: Three and nine months ended September 30, 2022 and 2021	5
Condensed Consolidated Statements of Cash Flows: Nine months ended September 30, 2022 and 2021	7
Notes to Condensed Consolidated Financial Statements	8
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	36
Item 3. Quantitative and Qualitative Disclosures About Market Risk	43
Item 4. Controls and Procedures	43

PART II: OTHER INFORMATION	45

Item 1. Legal Proceedings	45
Item 1A. Risk Factors	45
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	75
Item 3. Defaults Upon Senior Securities	75
Item 4. Mine Safety Disclosures	75
Item 5. Other Information	75
Item 6. Exhibits	76

SIGNATURES	78

PART 1: FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

MANNKIND CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

(In thousands, except share and per share data)

	September 30, 2022			December 31, 2021
ASSETS
Current assets:
Cash and cash equivalents	$	54,308		$	124,184
Short-term investments		110,738			79,932
Accounts receivable, net		23,493			4,739
Inventory		18,273			7,152
Prepaid expenses and other current assets		11,569			3,482
Total current assets		218,381			219,489
Property and equipment, net		41,182			36,612
Goodwill		3,067			—
Other intangible asset		1,169			—
Long-term investments		12,728			56,619
Other assets		17,310			8,441
Total assets	$	293,837		$	321,161

LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities:
Accounts payable	$	9,871		$	6,956
Accrued expenses and other current liabilities		30,350			27,419
Financing liability — current		9,525			6,977
Deferred revenue — current		1,786			827
Recognized loss on purchase commitments — current		8,065			6,170
Total current liabilities		59,597			48,349
Senior convertible notes		225,034			223,944
Midcap credit facility		39,155			38,833
Mann Group convertible note		8,829			18,425
Accrued interest — promissory note		56			404
Financing liability — long term		94,484			93,525
Recognized loss on purchase commitments — long term		62,173			76,659
Operating lease liability		5,666			1,040
Deferred revenue — long term		31,996			19,543
Milestone liabilities		4,524			4,838
Deposits from customer		—			4,950
Total liabilities		531,514			530,510
Commitments and contingencies (Note 15)
Stockholders' deficit:
Undesignated preferred stock, $0.01 par value — 10,000,000 shares authorized; no shares issued or outstanding as of September 30, 2022 and December 31, 2021		—			—
Common stock, $0.01 par value - 400,000,000 shares authorized, 263,156,165 and 251,477,562 shares issued and outstanding at September 30, 2022 and December 31, 2021, respectively		2,632			2,515
Additional paid-in capital		2,960,419			2,918,205
Accumulated other comprehensive loss		(1,206	)		—
Accumulated deficit		(3,199,522	)		(3,130,069	)
Total stockholders' deficit		(237,677	)		(209,349	)
Total liabilities and stockholders' deficit	$	293,837		$	321,161

See notes to condensed consolidated financial statements.

MANNKIND CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

(In thousands, except per share data)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2022			2021			2022			2021
Revenues:
Net revenue — commercial product sales	$	16,259		$	9,753		$	38,807		$	27,828
Revenue — collaborations and services		10,346			12,458			18,380			35,099
Royalties — collaborations		6,220			—			6,524			—
Total revenues		32,825			22,211			63,711			62,927
Expenses:
Cost of goods sold		5,021			3,812			11,922			12,538
Cost of revenue — collaborations and services		12,439			6,075			29,451			14,885
Research and development		4,136			3,655			12,565			8,426
Selling, general and administrative		22,638			17,221			69,378			54,690
Asset impairment		—			106			—			106
Gain on foreign currency translation		(1,799	)		(2,068	)		(8,285	)		(5,003	)
Loss on purchase commitments		—			—			—			339
Total expenses		42,435			28,801			115,031			85,981
Loss from operations		(9,610	)		(6,590	)		(51,320	)		(23,054	)
Other (expense) income:
Interest income, net		663			36			1,556			64
Interest expense on financing liability		(2,466	)		—			(7,280	)		—
Interest expense on notes		(2,812	)		(2,803	)		(12,202	)		(12,435	)
Gain (loss) on extinguishment of debt, net		—			4,930			—			(17,200	)
Other (expense) income		(207	)		1			(207	)		(240	)
Total other expense		(4,822	)		2,164			(18,133	)		(29,811	)
Loss before provision for income taxes		(14,432	)		(4,426	)		(69,453	)		(52,865	)
Provision for income taxes		—			—			—			—
Net loss	$	(14,432	)	$	(4,426	)	$	(69,453	)	$	(52,865	)
Net loss per share - basic and diluted	$	(0.06	)	$	(0.02	)	$	(0.27	)	$	(0.21	)
Shares used to compute net loss per share - basic and diluted		259,300			249,910			254,974			248,624

See notes to condensed consolidated financial statements.

MANNKIND CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

(Unaudited)

(In thousands)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2022			2021			2022			2021
Net loss	$	(14,432	)	$	(4,426	)	$	(69,453	)	$	(52,865	)
Other comprehensive loss:
Unrealized loss on available-for-sale securities		—			—			(1,206	)		—
Comprehensive loss	$	(14,432	)	$	(4,426	)	$	(70,659	)	$	(52,865	)

See notes to condensed consolidated financial statements.

MANNKIND CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ DEFICIT

(Unaudited)

(In thousands)

	Common Stock				Additional			Accumulated Other		Accumulated
	Shares		Amount		Paid-in Capital			Comprehensive Loss		Deficit			Total
BALANCE, JANUARY 1, 2021		242,118	$	2,421	$	2,866,303		$	—	$	(3,049,143	)	$	(180,419	)
Net issuance of common stock associated with stock options and restricted stock units		390		4		393			—		—			397
Issuance of common stock under Employee Stock Purchase Plan		293		3		387			—		—			390
Stock-based compensation expense		—		—		1,935			—		—			1,935
Issuance of common stock pursuant to conversion of the Mann Group convertible note		3,830		38		9,535			—		—			9,573
Issuance of common stock pursuant to conversion of the Mann Group convertible note interest		170		2		425			—		—			427
Issuance of common stock pursuant to conversion of the 2024 convertible notes		1,667		17		4,983			—		—			5,000
Issuance of common stock pursuant to payoff of the 2024 convertible note interest		27		—		143			—		—			143
Issuance of at-the-market placement		578		6		1,880			—		—			1,886
Issuance costs associated with at-the- market placement		—		—		(38	)		—		—			(38	)
Net loss		—		—		—			—		(12,916	)		(12,916	)
BALANCE, MARCH 31, 2021		249,073	$	2,491	$	2,885,946		$	—	$	(3,062,059	)	$	(173,622	)
Net issuance of common stock associated with stock options and restricted stock units		520		5		(550	)		—		—			(545	)
Stock-based compensation expense		—		—		3,926			—		—			3,926
Premium on Mann Group convertible note		—		—		22,107			—		—			22,107
Issuance of common stock from market price stock purchase		25		—		106			—		—			106
Net loss		—		—		—			—		(35,523	)		(35,523	)
BALANCE, JUNE 30, 2021		249,618	$	2,496	$	2,911,535		$	—	$	(3,097,582	)	$	(183,551	)
Issuance of common stock associated with debt interest payment		394		4		(594	)		—		—			(590	)
Net issuance of common stock associated with stock options and restricted stock units		234		2		698			—		—			700
Stock-based compensation expense		—		—		3,179

MANNKIND CORP [MNKD] Filings
10-Q	[2022-11-08]
10-Q	[2022-08-09]
10-Q	[2022-05-05]
10-K	[2022-02-24]
10-Q	[2021-11-09]
10-Q	[2021-08-11]
10-Q	[2021-05-12]
10-K	[2021-02-25]
10-Q	[2020-11-04]
10-Q	[2020-08-05]
10-Q	[2020-05-06]
10-K	[2020-02-25]
10-Q	[2019-11-08]
10-Q	[2019-08-07]
10-Q	[2019-05-07]
10-K	[2019-02-26]
10-Q	[2018-11-01]
10-Q	[2018-08-02]
10-Q	[2018-05-09]
10-K	[2018-02-27]
10-Q	[2017-11-07]
10-Q	[2017-08-07]
S-1	[2017-07-03]
10-Q	[2017-05-10]
10-K	[2017-03-16]
10-Q	[2016-11-09]
10-Q	[2016-08-09]
10-Q	[2016-05-09]
10-K	[2016-03-15]
10-Q	[2015-11-09]
10-Q	[2015-08-10]
10-Q	[2015-05-11]
10-K	[2015-03-02]
10-Q	[2014-11-10]
10-Q	[2014-08-11]
10-Q	[2014-05-12]
10-K	[2014-03-03]
10-Q	[2013-11-12]
10-Q	[2013-08-09]
10-Q	[2013-05-10]
10-K	[2013-03-18]
10-Q	[2012-11-09]
10-Q	[2012-08-09]
10-Q	[2012-05-10]
10-K	[2012-03-15]