MannKind (NASDAQ:MNKD) stock was flying high on Tuesday following the announcement of a deal with United Therapeutics (NASDAQ:UTHR).
The good news for MNKD stock comes in the form of an agreement to have it manufacture a dry powder formulation of treprostinil. This is a drug that is currently in testing for treating pulmonary arterial hypertension.
The deal will have MannKind acting as the manufacturer for clinical supplies of the drug and its initial commercial run. For its efforts, the company is getting an upfront payment of $45 million. There’s also $50 million in milestone payments available for MNKD as part of the agreement, as well as royalties off of net sales. Long-term supplies of the drug will be made by United Therapeutics.
This new venture between the two companies also includes additional licensing options for active ingredients in treating pulmonary hypertension. These other options would require upfront payments of $40 million each to MNKD. They would also include the milestone and royalty payments.
Topping off the deal between MannKind and United Therapeutics is a research agreement. This research agreement is for products that are not currently a part of the new licensing agreement. It includes a $10 million payment for MNKD.
“We are excited to partner with United Therapeutics, a company that shares our passionate focus on changing patients’ lives,” Michael Castagna, CEO of MannKind, said in a statement. “We are pleased with this new opportunity to demonstrate the value of our drug and device combination platform for delivering therapeutic products.”
MNKD stock was up 59% and UTHR stock was down 2% as of Tuesday morning. MNKD stock is currently down 58% year-to-date and UTHR stock is down 19% since the start of 2018.
As of this writing, William White did not hold a position in any of the aforementioned securities.
