MannKind Corporation is to cut 41% of its workforce as it struggles to get its foot in the approval door at the US Food and Drug Administration.
A throwaway sentence at the bottom of the company’s fourth quarter and full year financial results statement heralded the news, which will see some 179 jobs axed at the California-based company.
The news follows the FDA’s second rejection of the company’s inhaled insulin product Afrezza in January. The drug had previously been rejected in March last year.
The FDA has requested that MannKind conduct two clinical trials with its next generation Dreamboat inhaler – one in patients with type 1 diabetes and the other in type 2 diabetes – with at least one trial including a treatment group using the first-generation MedTone inhaler “in order to obtain a head-to-head comparison of the data for the two devices”. The Agency also requested more information about the performance characteristics, usage, handling, shipment and storage of the next- generation device as well as an update of safety information.
According to the statement released by the company on Thursday, 2011 “will be focused on the activities that are necessary to secure the approval of Afrezza”.
Part of those activities, said Alfred Mann, MannKind’s chairman and chief executive, would be the reduction in workforce. “We are restructuring our organisation to be focussed on securing the approval of Afrezza, which today resulted in the elimination of approximately 41% of our workforce.”
The job cuts are expected to be completed by mid-April.
Shares in the company dropped more than 9% in after-hours trading on the back of the news.