Incorporated : 1991 as Pharmaceutical Discovery Corp.
Employees : 428
Stock Exchanges : NASDAQ
Ticker Symbol : MNKD
NAIC : 325412 Pharmaceutical Preparation Manufacturing; 325414 Biological Product (Except Diagnostic) Manufacturing
MannKind Corporation is a biopharmaceutical company committed to developing therapeutic products to treat diabetes, cancer, inflammatory, and autoimmune diseases. The first product expected to reach the market is the company’s Technosphere Insulin System, which consists of a proprietary dry-powder formulation of insulin that is inhaled deep into the lungs using an inhaler dubbed MedTone. MannKind began clinical trials with diabetes patients in 2006. The Technosphere Insulin System, if approved by the U.S. Food and Drug Administration (FDA), was expected to make its commercial debut in 2010. Longer range plans called for the development of a cancer vaccine for patients with solid tumors. The company received approval from the FDA to begin Phase 1 clinical trials of its cancer vaccine at the end of 2006.
When Alfred E. Mann turned 79 in 2004, there was little time in his schedule to celebrate his birthday. The tireless billionaire, a prolific entrepreneur and munificent philanthropist, was spending 45 hours per week running the riskiest venture in his career, MannKind, which was slated for its public debut midway through the year. Mann also was devoting another 45 hours per week to guiding another of his companies, Advanced Bionics Corp., a maker of cochlear implants for the deaf. When Mann fulfilled his duties at MannKind and Advanced Bionics, his 90-hour workweek stretched into triple digits. He sat on the board of six other companies he had either founded or purchased, which filled another ten hours of his weekly schedule, leaving him hard-pressed to find the time for any extracurricular activities, birthday celebrations included.
Mann was born in 1925 in Portland, Oregon, the son of a Polish mother and English father who had immigrated to the Pacific Northwest. Mann, whose older brother became a founding member of the Juilliard String Quartet and whose younger sister became a concert pianist, lived above a small neighborhood grocery store his father owned, growing up during the Great Depression. Perhaps motivated by the devastating economic conditions surrounding him, Mann began working at an early age, selling magazine subscriptions and operating a lemonade stand, the first entrepreneurial venture in the career of a serial entrepreneur. Selling lemonade on a street corner was a childhood standard, however, offering nothing that distinguished Mann from any other ten-year-old. The first sign that Mann was an exception from the norm appeared in his academic performance. “I was a very avid student in school,” he reflected in a February 24, 2003, interview with the Los Angeles Business Journal. “I studied like hell.” He was selected as class valedictorian when he finished high school, earning the distinction and completing his course work at the age of 15. After high school, Mann worked in a shipyard until the Japanese attack on Pearl Harbor in December 1941 motivated him to join the U.S. Army Air Corps. Mann’s academic career resumed after his service during World War II. He enrolled at the University of California, Los Angeles (UCLA) and earned an undergraduate and graduate degree in physics, completing his studies in 1951.
After leaving UCLA, Mann accepted a job offer from Technicolor, which soon touched off what would be an exceptionally active career as a high-technology entrepreneur, one that met perhaps its greatest challenge with MannKind. Mann’s focus on the intricacies of the light spectrum while at UCLA led to his work on light filters and other related projects at Technicolor, which drew the attention of the U.S. Army, intent on developing the first heads-up fighter-aircraft display. Technicolor and the U.S. Army began working on the project, but Technicolor soon decided against continuing the collaborative effort. Mann, who had worked on the project, was approached by the U.S. Army soon afterward for his expertise in developing a light filter for a guidance system for an antitank missile. The two parties signed a contract for $11,200 that gave birth to Mann’s first company, Spectrolab, in 1956, which distinguished itself as a developer of filters that improved the performance of solar cells used to power U.S. spacecraft. The United States’ efforts to best the Soviet Union in the exploration of outer space provided fertile ground for Mann’s second entrepreneurial venture, Heliotek, which became the leading supplier of solar power systems to the U.S. space program before the end of the 1950s. In 1960, Mann’s first demonstration of founding one company after another was followed by another signature trait of his dealings in the business world: a buyout of his creations that delivered handsome payoffs. Textron, an aggressive conglomerate of the era, bought both of Mann’s companies, paying $11 million for Spectrolab and Heliotek and hiring Mann to lead the companies under the Textron corporate umbrella.
As his career played out, Mann often stayed with his ventures after they were purchased by another company, but his entrepreneurial inclinations always drove him to walk a more solitary path. Such was the case with his next company, Pacesetter, Inc., which manufactured pacemakers. Both Spectrolab and Heliotek made rechargeable batteries while under Mann’s management, which led Mann, encouraged by scientists at Johns Hopkins University, to launch Pacemaker as a producer of a pacemaker that could be recharged through a vest worn by a patient. The business began as a research side venture in 1969, but by 1972 Mann was ready to leave Textron and invest his own money and time into the company. After switching to long-lasting lithium batteries in 1976, Mann had produced another coveted commercial entity, one that was purchased by Siemens AG in 1985 for $150 million, half of which went into Mann’s pockets. As he had with Spectrolab and Heliotek, Mann remained in charge of Pacesetter after it was purchased by its German suitor, staying within the organization for the next seven years. Eventually, Mann was propelled by the drive that later would spur him as an octogenarian to work 100 hours per week. A new idea, his greatest financial success in the years before MannKind’s founding, pulled him away from the Siemens fold, making him one of the wealthiest individuals in the United States.
Mann launched MiniMed Inc. as a side venture in 1979, paralleling the way Pacesetter began a decade earlier. The commonality between the two companies ran deeper: MiniMed was established to develop an implantable insulin pump using the same type of rechargeable technology used by Pacesetter. In terms of its perceived market value, however, MiniMed stood in sharp contrast to Pacesetter. MiniMed became the world’s leading manufacturer of insulin pumps, controlling 80 percent of the insulin pump market.
At MannKind, our focus is the discovery, development and, ultimately, the commercialization of therapeutic products for diseases for which there is a significant unmet medical need, such as diabetes and cancer.
Mann’s success with MiniMed laid the foundation for MannKind, proving to be instrumental to the company’s formation and ability to operate in the costly field of biopharmaceutical development. Mann registered the biggest payday of his career when he sold MiniMed, giving him a massive personal fortune to finance the development of MannKind. In 2001, Medtronic Inc., a Minneapolis, Minnesota-based biomedical device maker, agreed to pay $4.2 billion for MiniMed and a research affiliate, Medical Research Group Inc., a deal that netted Mann more than $1 billion. MiniMed also played a role in the first steps toward forming MannKind. In early 1998, while Mann was presiding over MiniMed’s insulin pump business, a Toronto entrepreneur named John Simard called Mann, looking for help in obtaining pumps for cancer vaccine trials he wanted to begin in Europe. A year earlier, Simard had founded CTL ImmunoTherapies Corp., a one-man operation that had taken on the daunting task of curing cancer. Mann was intrigued by CTL’s prospects and agreed to provide pumps and to invest $500,000 in the company’s development. A little more than a year after his first contact with Simard, Mann increased his commitment, investing several million dollars to take an ownership share in CTL, which relocated to Chatsworth, California, to be closer to its new owner. “I really intended it to be more of a philanthropic effort, although it was a business,” Mann said of his investment in CTL in a March 29, 2004, interview with the Daily Deal. “I wasn’t as concerned with making money as curing cancer.”
Mann’s altruistic motivations would serve him well as he began to redirect his energies from MiniMed toward MannKind. The company was formed by combining CTL with two other companies, Valencia, California-based AlleCure Corp. and Danbury, Connecticut-based Pharmaceutical Discovery Corp. (PDC). AlleCure, an early-stage company like CTL, was developing immunology products to help prevent and treat allergies, basing its efforts on the work of Swiss scientist Rolf Zinkernagel, recipient of the 1996 Nobel Prize for Medicine. PDC, founded in 1991, developed drug delivery technologies, specializing in pulmonary delivery systems. Mann merged CTL and AlleCure into PDC in December 2001, a transaction that coincided with PDC changing its name to MannKind Corporation. “There is a lot of interest and synergy between them,” Mann said in a May 14, 2001, interview with the Los Angeles Business Journal, referring to the three entities composing his new company. “It lets us create a very powerful and diverse pharma company. We will take it public—market willing—some time in the late third or early fourth quarter.”
Mann entered a new realm once he switched from guiding MiniMed to spearheading MannKind’s development. Medical device makers such as MiniMed and Mann’s other ventures faced a far less rigorous, time-consuming, and capital-intensive regulatory approval process than the arduous struggle pharmaceutical concerns faced. Gaining FDA approval meant passing through three phases of trials that took years and hundreds of millions of dollars to complete, a process during which MannKind would generate no revenues and rack up heavy annual losses. The pressures imposed by the approval process had a defining influence on MannKind, forcing Mann to alter his priorities. He had intended to focus on developing cancer vaccines, early trials of which proved promising, but mounting losses convinced him to make cancer treatments a secondary objective. MannKind, instead, would focus on a project closer to receiving FDA approval, pinning its efforts on treating diabetes with an inhaled form of insulin. Plans to develop cancer vaccines and treatments for inflamma-tory and autoimmune diseases remained in place, work that was conducted at the company’s Valencia-based research operations, but most of the company’s attention was focused on operations at PDC’s former headquarters in Danbury, Connecticut, where research, development, and manufacturing of the Technosphere Insulin System took center stage.
Technosphere promised to offer diabetics a way of maintaining proper glucose levels that eliminated the need to inject insulin subcutaneously. The system used a proprietary dry-powder formulation that was inhaled deep into the lungs using a special inhaler developed by MannKind, the MedTone. Aside from eliminating the use of a needle, Technosphere was shown to absorb rapidly into the bloodstream following inhalation, performing most of the glucose-lowering activity of insulin within three hours of administration, roughly the same time glucose became available after ingesting food and much quicker than injected insulin.
- Pharmaceutical Discovery Corp. is founded.
- Alfred Mann acquires majority control of CTL ImmunoTherapies Corp.
- Mann merges AlleCure Corp. and CTL into Pharmaceutical Discovery, giving the new entity the name MannKind Corporation.
- MannKind completes its initial public offering of stock.
- The company begins Phase 3 clinical trials on the Technosphere Insulin System and begins early-stage trials on a cancer vaccine.
As MannKind sought to gain FDA approval for Technosphere, the company chewed through hundreds of million of dollars, substantial chunks of which were supplied by Mann. Against the backdrop of the company’s efforts to enter the market, anticipation of its debut on Wall Street occupied the interest of industry onlookers. Initially, Mann had declared he intended to complete an initial public offering (IPO) of stock in late 2001, but market conditions were not favorable for a conversion to public ownership. Another attempt was scheduled for mid-2002, but Mann canceled plans for an IPO. “We met with bankers and they told me that, because of my track record with companies and my reputation, that we could go public now,” Mann said in an April 8, 2002, interview with the Los Angeles Business Journal. “But I don’t believe the market is ready,” he added. After again canceling plans for an IPO in early 2003, the company finally completed its public offering in July 2004, when it raised net proceeds of $83.2 million.
The money raised from the IPO provided some financial relief, but not nearly enough to end the company’s worries. MannKind was a developmental-stage company, and it would remain so well into Mann’s 80s. The company began the third and most expensive phase of the FDA approval process in late 2006, by which point more than $650 million had been spent trying to bring Technosphere to market. Analysts predicted Technosphere would not reach doctors’ offices until at least 2010. The company also began early-stage clinical trials on its experimental cancer drug, MKC1106-PP, in late 2006, opening up another costly yet potentially lucrative avenue for Mann and his successors to pursue. MannKind’s fate entirely rested on future developments, but as the company progressed toward its goal of becoming a commercially active concern, it stood to benefit from the persistence and enormous wealth of its creator.
Jeffrey L. Covell
MannKind Endocrinology; MannKind Immunology.
Pfizer Inc.; Novo Nordisk A/S; Eli Lilly and Company.
Coates, Chris, “Burning Cash, MannKind Is Raising More Money,” San Fernando Valley Business Journal, December 4, 2006, p. 11.
———, “MannKind Stock Soars on Prospects for New Drug,” San Fernando Valley Business Journal, July 17, 2006, p. 10.
Darmiento, Laurence, “Biotech Mogul Mann Delays One IPO and Gets Set for Another,” Los Angeles Business Journal, January 13, 2003, p. 12.
———, “Mann Still Tireless in Research Quest,” Los Angeles Business Journal, February 24, 2003, p. 1.
Garcia, Shelly, “MannKind Making Another Attempt to Launch IPO,” San Fernando Valley Business Journal, May 10, 2004, p. 1.
Ibold, Hans, “Mann Slates Biotech IPO by Year End,” Los Angeles Business Journal, May 14, 2001, p. 3.
Jaffe, Joshua, “Reaching for the Impossible?” Daily Deal, March 29, 2004.
Martinez, Carlos, “Biotech Billionaire Says Market Not Ready for IPO,” Los Angeles Business Journal, April 8, 2002, p. 11.
Netherby, Jennifer, “Alfred Mann’s Magic Boosts Company’s Cancer Vaccine,” Los Angeles Business Journal, March 27, 2000, p. 10.
Pondel, Evan, “Valencia, Calif.-based AlleCure Developing Vaccine Against Bee Venom,” Daily News, April 2, 2002.
"MannKind Corporation." International Directory of Company Histories. . Encyclopedia.com. (November 21, 2018). https://www.encyclopedia.com/books/politics-and-business-magazines/mannkind-corporation
"MannKind Corporation." International Directory of Company Histories. . Retrieved November 21, 2018 from Encyclopedia.com: https://www.encyclopedia.com/books/politics-and-business-magazines/mannkind-corporation
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