MannKind (NASDAQ: MNKD)

MannKind focuses on the discovery, development and commercialization of treatments for diabetes and cancer. The leading candidate of the company is AFREZZA which is an orally administered insulin, in late stage clinical trials. The drug will target patients with type I and type II diabetes. The primary oncology candidate of MannKind is MKC1106-MT which is Phase II clinical trials.

The company is entering a market where other big pharmaceutical players have already failed. The recent multibillion failure of Exubera is still fresh on investors mind. Exubera was Pfizer’s attempt at providing an inhalable insulin product to the market but it failed due to high price and its adverse effects on lungs. AFREZZA tries to rectify these mistakes and has a much better shot at success. It is a ultra-rapid insulin which means that the drug spends a minimum time in the system reducing exposure to the lungs and it also reduces chances of hypoglycemia and obesity. The insulin solution will also be available at lower price points as compared to Exubera, with it being only 10% more expensive as compared to regular insulin products.

Insiders have increased their stake in the company by 31,269,350 shares which comes down to an increase in insider ownership of a staggering 48%. During the same time frame of six months, institutional investors have reduced their holding of MannKind by 2,485,390 shares i.e. 7%. The stock is currently trading at a 65% discount to mean sell side target price of $5.5. The market is discounting MannKind due to previous failures of Exubera but insider trust and cheap valuations make it a good investment option.

http://beta.fool.com/smartequity/2013/02/22/3-bio-pharmaceuticals-insiders-love/25315/