MannKind Corporation (MNKD) Earnings Call Transcript & Summary

Good afternoon, and welcome to the MannKind Corporation conference call to discuss the Phase 1b results for its nintedanib DPI. As a reminder, this call is being recorded on July 29, 2026, and will be available for replay on the MannKind Corporation website shortly after this call for approximately 90 days. This call will contain forward-looking statements. Such forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from these expectations. For further information on the company's risk factors, please see the Form 10-Q for the period ended March 31, 2026, this morning's press release and the slides prepared for this presentation. Joining us this morning are Michael Castagna, Chief Executive Officer; and Dr. Wassim Fares, Senior Vice President and Therapeutic Area Head, Respiratory. I'd now like to turn the conference over to Mr. Castagna.

Thanks, operator, and good afternoon, everyone. Thank you for joining us for this focused update on nintedanib DPI. I'll begin with the IPF opportunity and why we believe this program can create meaningful shareholder value over the coming years. Then Dr. Fares will review the clinical data, including our Phase 1b results as well as the history of the program leading into our global Phase 2 now underway. I'll return with a few closing thoughts before we open up the call for questions. Let me start with the broader context. At the beginning of the year, we laid out three major catalysts. We have now delivered on all three through July. The Afrezza pediatric indication is now approved, expanding the population we can serve and creating a growth opportunity. We're excited about the early days of launch, and we'll provide more details on our next week's earnings call. Furoscix ReadyFlow is approved, reducing administration from hours to seconds while supporting broader adoption and operation in health systems as well as a lower cost of goods. Two approvals in a single year is allowed for a company of any size, let alone ours, which brings me to nintedanib DPI. When we call this update, we've completed the third catalyst on this page, and it's the one we spent the last seven years to get to this point. There's an urgent need for new effective therapies in IPF, and we believe lung targeted delivery is the best approach that addresses the tolerability barriers that are holding today's therapies back. For us, our Phase 1b data is the key clinical derisking step for the entire program, and it's the reason we want to walk you through the history and the full picture where we are today. Let's begin with the opportunity. The first is that our Phase 1b study demonstrated safety and tolerability in patients with IPF. That's a data set we haven't had. And I'm proud to say there were no serious adverse events, no GI issues and no patient discontinued. Dr. Fares will take you through the details shortly, but I'd summarize it this way. The tolerability questions we and our investors have cared about, including inhaled antifibrotic therapy in the lungs are precisely the questions the study was built to address, and the results give us the confidence to advance this program forward. Our global Phase 2 is underway, and we are actively progressing site activations, and we expect enrollment to continue to increase as we progress through 2026. I want to spend a minute why we're investing here. It's because IPF is a category that has already been commercially validated. We don't have to establish a disease state. These are approved therapies in the market today, and OPEB has generated more than $4 billion in global revenue just in 2025. And I hear Jascayd is off to a fast start, approaching $2 billion in their first year of launch. You have a blockbuster precedent in a disease with roughly 100,000 IPF patients in the U.S., a population that unfortunately continues to rise, year after year. Beyond IPF itself, there's a larger adjacent segment of patients with pulmonary fibrosis, more broadly interstitial lung diseases that can lead and progress to fibrosis. So, the market does not need to be created. The disease burden is clear. The treatment category is established. The unmet need remains substantial and unchanged, and that combination creates an opportunity for a targeted inhaled delivery. Let me be a little more specific about the challenge we face because it's not a problem of efficacy. Nintedanib works. We don't question that. It's the first drug to really show what it can do to help patients. The problem is, patients can never start therapy because they know the side effect profile or they don't stay on therapy. Three out of four IPF patients are not on an approved antifibrotic therapy despite the fact that 80% face the risk of death within five years of diagnosis. Among those who do start, published discontinuation rates run as high as 50% and current therapies carry major tolerability challenges. Our aspiration was to take a proven molecule, change in route administration to solve this unmet need created by the standard of care. Nintedanib DPI is designed to deliver drug directly to the deep lung where fibrosis occurs while bypassing the GI tract and reducing systemic exposure. The GI adverse effects associated with oral nintedanib are the reason so many patients stop or never want to start. So reducing systemic exposure is the mechanism by which we hope to change the treatment experience. We believe this approach has the potential to improve efficacy and tolerability, which may support long-term adherence. This thesis has recently been proven out by the data release on inhaled pirfenidone as well as Tyvaso's TETON-1 and 2 trial, all of which show that targeted lung delivery therapy does drive efficacy in IPF. With these Phase 1b results, we have more confidence in our program and why this target approach will have an impact on patient outcomes. The reason we believe we can execute on this thesis is the platform underneath it. Technosphere technology provides highly efficient delivery of a dry powder through a small portable device that we call Dreamboat. The SDK microparticles at the core of our technology drive rapid uniform distribution deep into the lung with extensive throughout the lung tissue. Often, I get asked, can they inhale a dry powder? Will they receive the product? And the answer is yes. If air is flowing, our powders are going into that area of the lung. It's already been validated on two FDA-approved products, Afrezza and Tyvaso DPI. For us, that changes the CMC and drug device risk profile of a program like this considerably. We're not simultaneously trying to prove a new delivery technology and a new molecule and a therapeutic hypothesis. We know how to formulate this on our platform. We know how to manufacture at scale. We have real-world data experience in how patients use our inhalers day in and day out. For a chronic disease where patients may be on therapy for years, the practical characteristics of the device, the portability, the fast inhalation are not a footnote. They are part of whether a therapy gets used at all. One technical point worth understanding is the versatility of the platform. A Technosphere particle and the products that we make are mostly FDKP-based carrier with a small percentage of active drug, as you can see here. Technosphere powder has now been used in more than 50,000 patients, a substantial base of experience with the carrier itself before we ever put nintedanib on it. This gives us ability to really understand where our particles go, how they are formed and how patients can tolerate them across multiple diseases. I also want to address a question we get regularly, which is whether patients and prescribers will adopt a dry powder inhaler. We have a case study from our own experience in the inhaled treprostinil market, where DPI today has grown to 80% of the market since launch. Patients have demanded this, patients have enjoyed it. In this pulmonary population, many of them elderly, many of them compromised lung function, the DPI format has become the dominant way the therapy is delivered. I'm not going to claim that history will repeat itself automatically in IPF, but it does tell us something important about behavior. When a dry powder option offers a genuine better experience than the alternative, clinicians prescribe it and patients demand it. Those dynamics give us confidence in the commercial logic behind nintedanib DPI, assuming we deliver the clinical profile we're working towards. With that said, let me turn it over to our clinical data. I'm pleased to introduce you to Dr. Wassim Fares, who joined us a little over three years ago to lead our respiratory therapeutic area. Dr. Fares is a Board-certified pulmonologist with more than 18 years of running respiratory clinical development programs in PAH, IPF from early-stage studies all the way through Phase 3 and post approval. He has spent a career on serious rare lung diseases across both academic medicine and biopharma. So he understands the challenges patients face, how to develop drugs and how to get these to patients in the quickest way possible. Thank you, Dr. Wassim, for joining us today, and I will turn it over to you.

Thank you, Mike. Good afternoon, everyone. Before starting the clinical program in humans, we conducted multiple animal studies to characterize the pharmacokinetics, pharmacodynamics and safety of an interactive dry powder inhalation. In these preclinical studies, which included five non-GLP, GLP stands for Good Laboratory Practice and three GLP studies, lung concentrations were at least 100-fold higher than plasma with minimal systemic exposure. We did 28-day tox studies in two different species and a six-month repeat dose study. These studies showed no clinical toxicity, and they established a wide safety margin, which was a pharmacokinetic and safety foundation we needed to move into humans. Since then, our clinical program has advanced from first-in-human healthy adult volunteers to patients living with IPF. We published the results of the healthy volunteer study, along with the preclinical studies earlier this year, and we are reporting today the results of INFLO-1, the Phase 1b study that showed safety and tolerability of nintedanib DPI in patients living with IPF. We are now enrolling in INFLO-2, our global Phase 2 study for patients with IPF. In less than two years, the program has moved from first-in-human dosing to a global Phase 2 study, which we are very proud of. The team has done an exceptional job with this progress. In the next few slides, I will go into more detail into each of these studies in humans. Starting with the first-in-human study. It used a standard stepwise design. Part A evaluated single ascending doses from two to eight milligrams. After formal safety reviews, Part B evaluated twice daily repeat dosing over seven days. The objectives were safety, tolerability and pharmacokinetics, not efficacy. We wanted to know whether we can deliver enough exposure in the deep lungs where IPF pathology is, whether exposure increased predictively with dose and whether repeated delivery into the airways produced any signal of concern. Nintedanib DPI was safe and well tolerated over seven days in healthy adults with no safety signals, no serious adverse events and no study drug discontinuations. We observed mild reversible cough typically after the first dose without worsening on repeat dosing. We did not observe the systemic adverse events commonly associated with oral nintedanib, including diarrhea, nausea, vomiting or headache. This was a short study in healthy volunteers, so it cannot establish chronic tolerability. But it provided the first human evidence that the formulation behaved as intended and supported advancement into patients with IPF. Before I remind you of our PK data that we published earlier this year, I want to highlight the importance of nintedanib Cmax, which supports a lung targeted approach. Published preclinical work shows that peak lung concentration, that is Cmax is more important to nintedanib antifibrotic activity than total exposure over time, that is AUC. In those models, brief high concentrations were sufficient to inhibit fibrotic pathways, while additional ongoing exposure beyond the peak did not add much. That creates a rational fit for inhaled delivery, achieve a high brief concentration in the lungs while limiting prolonged systemic exposure. Our human pharmacokinetic data are consistent with efficient drug lung delivery. For inhaled nintedanib to reach the blood, it must go through the deep lungs first, including LDLI, pass through the lung interstitium where IPF pathology is, and then cross to the blood. So plasma levels are an excellent surrogate of how much the drug is delivered to the deep lungs. To orient you to this figure, our PK data are on the left. The ones on the right are published data from a nebulized nintedanib formulation. At comparable doses, nintedanib DPI produced plasma Cmax values approximately 6x to 8x higher than published values for nebulized nintedanib. This is a cross-study comparison, not a head-to-head trial, and it should be interpreted accordingly. What it shows is that the Technosphere formulation is delivering drug efficiently to the deep lungs with an immediate plasma peak. Now let's turn to the study most relevant to today's update. INFLO-1 was a randomized, double-blind, placebo-controlled Phase 1b study in 27 patients living with IPF across 10 sites in the United States. Patients received 1 of 2 active regimens or placebo over seven days with formal safety review by the sponsor, us, and an external data safety monitoring board before dose escalation. The study was designed to assess short-term safety, tolerability and pharmacokinetics. The gating question was simple. Can a fibrotic lung tolerate repeated administration of nintedanib DPI? The answer from this study was a clear yes. The safety profile was clean. There was no drug-related diarrhea, nausea or vomiting. As you know, these are the major adverse events that limit the use of oral nintedanib. There were no bronchospasms, no changes in oxygen levels or respiratory rate and no study drug discontinuations or dose reductions. This is a meaningful derisking step as we move into Phase 2. Let me address cough directly because it is the most common question about delivering a powder into fibrotic lungs. Approximately 60% of patients living with IPF who received active drug in this study had no cough. Roughly 90% had either no cough or only a mild that is Grade 1 cough adverse event and none had a severe cough. When cough occurred, whether in this study or in our other studies using Technosphere technology, it generally followed the first dose and did not worsen with continued dosing. There were no discontinuations, no dose reductions, and there was no correlation between cough and powder mass. The observed pattern is consistent with prior experience across our Technosphere platform, where clinical data from approved products show less than 3% discontinuation due to cough. The extent of patient exposure also matters. Let me orient you to this figure. Magenta color reflects exposure in our trials with nintedanib DPI. Gray color reflects reported exposure by a nebulized nintedanib formulation. On the left, it shows exposure in healthy volunteers. On the right, it shows exposure in patients living with IPF. Across INFLO-1, we administered around 448 inhalations of nintedanib DPI to patients with IPF. I'm not talking about exposure in healthy volunteers. I'm talking about patients with the target disease idiopathic pulmonary fibrosis. Contrast this with what has been reported with the nebulized nintedanib formulation, we could find that only six doses were given to patients living with IPF, one dose per patient for six patients with IPF. As you know, exposure and clinical experience in patients with the target disease are very important. With that exposure to nintedanib DPI, we saw no difference in spirometry between active drug and placebo, which use an empty cartridge. For clinicians evaluating an inhaled therapy in a compromised lung, that is an important pulmonary safety observation. This provides an impressive early safety database in the target population using a carrier already experienced by thousands of patients living with ILD through Tyvaso DPI in PH-ILD. With that strong foundation, let me turn to Phase 2. INFLO-2 is a randomized, double-blind, placebo-controlled global study that will enroll 210 patients with IPF. The 12-week controlled period evaluates two active regimens against matched placebo, followed by a 24-week open-label extension. So at the end of the trial, we will have safety and efficacy data in patients with IPF over a nine-month period. The primary objective is safety and tolerability with Forced Vital Capacity or FVC as the key efficacy endpoint. Importantly, the study includes patients who are untreated, that is they are not on background IPF therapies as well as patients who are on stable background therapy of pirfenidone and/or Jascayd. That design reflects the evolving IPF treatment landscape and preserves our ability to understand nintedanib DPI, both as an alternative first-line antifibrotic and as a potential backbone for combination therapy. With that, I'll turn the call back to Mike.

Thanks, Wassim. Let me close how we think about the value here. First, on patent protection, we built a layered patent estate specific to nintedanib DPI in combination use with the longest dated protection extending to 2046. Underneath the product estate sits the platform itself with more than 1,400 patents enforce worldwide. And I'd like to add one point beyond patents. Manufacturing this powder at scale is genuinely complex, and that complexity has a practical barrier to entry. We spent 35 years building the capability to make it at scale, and it isn't something a competitor can quickly stand up. Nintedanib DPI is designed to be delivered in seconds and give patients lung targeted delivery without the nebulizer burden or the systemic adverse events associated with oral therapy. Our Technosphere particles are already validated in two FDA-approved products used in the adult population, including elderly individuals with compromised lung function, and this overlap is within our target population is really relevant to where we're going. We also have experience in this clinical setting and our platform has demonstrated safety and tolerability in patients with underlying lung diseases. Tyvaso DPI is approved in PH and PH-ILD, which includes patients who also live with IPF in some cases. Nintedanib is a gold standard in this disease, but the GI burden of the oral caps how much it can be used. I've never believed the ceiling of this molecule was scientific. It's always been tolerability, and that's been going on for over a decade. At the same time, IPF is moving towards combination treatment as more options become available. We've seen the same progression across other chronic conditions, including respiratory disease, where monotherapy comes out and established as a category, new mechanisms enter and combination therapies follow. This is further evidenced as we look at the data just recently presented in TETON 1 and 2 that showed using combination use in IPF got additional effect size for patients. Our thesis is that a well-tolerated second-lung inhalation nintedanib can become the backbone of future regimens. If patients are going to receive multiple therapies, the foundation needs to be effective, practical and something they can remain on. That is our strategic thesis, not a demonstrated outcome, but it explains why we've designed our Phase 2 the way Dr. Fares described it, preserving the ability for combination approaches as well as monotherapy. Finally, I want to zoom out because nintedanib DPI isn't our only exposure to this market. We have three shots on goal when we look at the IPF landscape, all of them running on our proven platform in that large underserved market. Nintedanib DPI is the asset we fully own. Tyvaso DPI through our partner, United Therapeutics is approved today with potential future expansion in IPF. And we recently announced in partnership with United Therapeutics, the nintedanib DPI that is progressing towards IND. Each of these programs draws on the same formulation science, the same manufacturing base and the same clinical experience delivering dry powder into compromised lungs. The scientific and operational learnings from any one of these carries into the others. We're applying a large single capability across the same market, multiple angles from our lead asset as well as our partner programs. None of this guarantees clinical or commercial success, but it means we have a shot to make this very successful to help patients. And with that said, operator, I'm going to turn it over and open it up for Q&A.

[Operator Instructions] Our first question comes from Ben Burnett with Wells Fargo.

This is Xinyi calling in for Ben. Congrats on the data team. So I really appreciate the color that you provided on PK comparison versus the nebulized nintedanib. So just curious, have you guys conducted an analysis or comparison versus the oral one? How does it look like?

I think back to our animal tox, our animal program is probably where we would compare to oral. But in humans, we've not done that because we're not trying to match plasma PK per se. And the data on plasma is out there publicly on oral. So there was no need to redo that work.

Got it. Got it. Another follow-up is, so now that you have this new data set, how does that change your thinking around, like expectation for the Phase 2 data, whether it's safety or efficacy? Any updated thoughts over there?

I don't think it changes how we started the Phase 2 in parallel at risk, knowing that this result will come out somewhere in the middle or before we started the trial. It doesn't fundamentally change anything. If anything, it gets us more excited to go faster. And that's really what we're evaluating is now that we have 100% confidence on lung. The #1 question we get is cough tolerability, can patients of IPF do this? I think we can clearly say this after over about 50 patients and hundreds of doses, we feel very comfortable going forward, and we're trying to see how we can accelerate this as quickly as possible.

Our next question comes from Olivia Brayer with Cantor.

I want to drill down a little bit more on the adverse event data. I don't know how much more granular you can get or if you're planning to provide an event table at some point. But maybe just on the cough, can you characterize whether that 10% cough rate, was it all deemed treatment related? And then for those 60% with no cough, is that just no cough whatsoever or just no worsening cough from baseline? And then I also wanted to ask, it sounds like you saw cough almost immediately after the first inhalation in those patients that did have it. But was any of it transient? Or did it resolve over time? Just trying to understand the comments made around it mostly not worsening. And then I've got a couple of follow-ups, if you don't mind.

Great, Olivia. I'll give some comment, and I'm going to turn it over to Wassim to give further dialogue. The first I want to say is that the cartridges are 10 to 20 milligrams in powder per episode. So we're talking about every time you gave an administration, you might have got one cartridge and two cartridges. And so think about the powder load and the incidence of the number of cartridges. I'll let Wassim talk about the data behind the cough as he's closer to it. So Wassim?

Olivia, good to hear from you. As you mentioned, 60% did not have cough reported as an adverse event. So what that means, if they had cough as a baseline, it did not get worse was cough related to IPF. or if you did not have cough, it did not cause cough. So that's one of the questions. I think the first question was we will report more details about this study in upcoming scientific conference. And then the others, the 40% the remaining 40% who had reported cough were deemed related to the study drug, yes. The 3/4 of those were mild. Most of them were also transient. So it was like an irritation after the first inhalation for most of these patients. Did I miss any of the questions, Olivia?

Olivia, did we get all your questions?

Okay. Perfect. Yes. Just to clarify on that. So that final 10%, that is cough, right, is how you guys are characterizing that, 30% mild, 10% moderate?

Yes. Yes. 30% had grade 1 mild, 10% were moderate.

And, this is very subjective on cough, right, versus the continued cough could make a difference. But they're all mostly transient. I think that's what's most important. These are not adding a huge burden to the patient. They're mostly reaction after inhalation.

Okay. And then I wanted to ask on your PK data. If you're achieving 6x to 8x higher plasma exposure than nebulized nintedanib, how are you thinking about the balance between maximizing lung exposure and then obviously minimizing systemic exposure, just given that I know one of the major goals of the inhalation approach is to avoid some of those dose-limiting toxicities that we've seen with the oral therapy.