Sanofi has linked up with MannKind Corp to sell the latter’s inhaled insulin Afrezza, which was finally approved by the US Food and Drug Administration at the end of June.

The deal, which provoked a jump in MannKind shares, will see Sanofi pay up to $925 million - $150 million upfront and a possible $775 million in milestones. The French giant will retain 65% of profits (or losses), while MannKind will get 35%.

Sanofi has agreed to advance MannKind its share of the collaboration's expenses up to a limit of $175 million. Under a separate agreement, MannKind will manufacture Afrezza at its facility in Danbury, Connecticut and the companies are planning to expand capacity to meet global demand as necessary.

The FDA gave the thumbs-up to Afrezza, a dry formulation of human insulin delivered through a small, discreet inhaler, at the third time of asking, although the green light came with a boxed warning and a requirement for more studies. MannKind’s founder and chief executive, Alfred Mann, who is estimated to have put nearly $1 billion of his own money into the company, said Sanofi is “the ideal partner given their complementary product portfolio, their vast insulin market presence and a leading global commercial infrastructure”.

A US launch is scheduled for the first quarter of 2015 and Sanofi diabetes chief Pierre Chancel said Afrezza is “uniquely positioned to provide patients with another insulin therapy option to manage their diabetes but does not require multiple daily injections”. However, a number of observers have yet to be convinced about the impact an inhaled insulin product will have, referencing Pfizer’s Exubera which was pulled from the market nearly seven years ago after failing to make any impact on the market.