What's Afrezza's Ultimate Potential For MannKind?

In a report published Thursday, RBC Capital Markets analyst Adnan Butt commented that

has seen its Afrezza slow to take off and first quarter sales are likely to miss consensus estimates. Butt noted that the consensus estimate for MannKind is approximately $3.9 million, which is based on IMS estimates of approximately $0.2 million. The analyst said that this could be too high unless there is inventory build. In addition, 2015 full year sales expectations of $49 million also appear high based on trajectories implied by third-party data. Butt said that he had expected a "tough slog" but nevertheless he lowered his Afrezza sales forecasts for 2015 to $5 million (from $46 million), for 2016 to $118 million (from $150 million), and for 2019 to $539 million (from $845 million), while peak sales are now forecasted in the $2 billion to $3 billion range versus $4 billion previously forecasted. Nevertheless, the analyst suggested that the concept underlying Afrezza "remains elegant" and as long as the post-approval studies read clean, it will be a "big drug." Looking forward, the analyst identified three potential catalysts for the stock: 1. European Union filing plans in 2015 in which MannKind will count on

for an MAA filing where visibility on approval would be a positive. 2. Afrezza post-approval study details as timelines have implications for label expansion. 3. Launch trajectory over the next 12-18 months. Shares remain Outperform rated with a price target lowered to $10 from a previous $13.