Many investors were this past Friday, June 27th when the FDA decided to approve Mannkind's (MNKD) Afrezza for patients with both type 1 and type 2 diabetes. The news of this approval would be considered excellent except for the fact that the stock tanked by at least 10% on concerns of the FDA label. The label puts several limitations on the use of Afrezza, and so there are skeptics who think that Mannkind won't achieve great sales, or will have face an uphill battle finding a partner to market the inhaled-insulin drug. So far today, the stock has gained 10% after investors had time to digest the news that this could be a revolutionary treatment for patients with diabetes.

Current therapy for patients with diabetes deals with regular insulin injections; injections which can be very uncomfortable for patients. Mannkind's Afrezza which is currently approved is a form of insulin which can be inhaled; a far less painful method of administration. This is a major quality of life enhancement for those whom suffer from diabetes. Another added benefit is that patients that inject their insulin will have to wait an hour or more for the drug to take effect. Afrezza, however, can help a patient with diabetes achieve their proper insulin level around 13 minutes after treatment.

There are approximately 29.1 million people in the United states that either have type 1 or type 2 diabetes according to the American Diabetes Association. There is quite a bit of differences between patients with type 1 and type 2 diabetes but they both deal with some problem the body has with insulin. For instance with type 1 diabetes patients are unable to produce insulin that the body needs - so lack of insulin production is a big problem for the body. Patients with type 2 diabetes generate insulin in the body but their bodies lack the ability to efficiently use the insulin that is produced. There are many symptoms associated with diabetes but some of the main ones deal with frequent urination, feeling very thirsty all the time, and feeling hungry even after eating. Some people may even have diabetes and not know it because patients with type 2 diabetes have mild symptoms that people pass off as nothing worth exploring.

Mannkind has a great victory with this approval, especially considering its stock price has already gone up many times while seeking FDA approval for Afrezza. The problem was that the FDA continually wanted more tests to be done to further prove that inhaling insulin could help patients control their diabetes. As with any drug compound there are some downsides that may or may not affect the future of Afrezza on the market. One problem is that Afrezza will not completely replace long acting insulin, but on the plus side, it could be used throughout the day before meals as a less invasive alternative. Another problem is that the FDA put a label stating that Afrezza can't be used in patients with lung diseases, such as asthma, so this will limit some of the market potential for Afrezza.

We believe that despite these label additions, there is a huge market for Afrezza. The stock currently trades at around $11 per share but there is still plenty of room for share appreciation. This could be likely due to possible partnerships or future revenue. There will have to be some kind of partner out there for Mannkind, one that wants to reap the benefit of generating billions of dollars from the plethora of diabetes patients, Afrezza's potential customers. More about Mannkind's press release for FDA approval of Afrezza can be found here. We think that long term investors should do just fine holding onto a position that will rise in the years to come, and we think Mannkind is a long term buy.