MannKind Corp. announced on Monday it has signed a $925 million agreement with French drug company Sanofi to market and sell is Afrezza inhalable insulin worldwide.
Under the long-awaited deal, the Valencia biotech will manufacture Afrezza at its plant in Danbury, Conn., while the Paris-based drug company will take responsibility for marketing and regulatory compliance.
MannKind will receive an upfront payment of $150 million and milestone payments up to $775 million, based on sales. Sanofi and MannKind will share profits and losses on a global basis, with Sanofi retaining 65 percent and MannKind receiving 35 percent. Sanofi will advance to MannKind its share of the collaboration’s expenses, up to a limit of $175 million.
The two companies plan to launch Afrezza in the United States during the first quarter of 2015. There was no timetable set for seeking foreign regulatory approvals.
The agreement follows the June 27 decision by the Food and Drug Administration to approve Afrezza for sale in the United States. The ruling came after a lengthy review process during which the government twice required MannKind to conduct additional clinical tests.
The pact with Sanofi is the second agreement the biotech has reached with a French company. Last week, it announced that Amphastar France Pharmaceuticals S.A.S.. will make recombinant human insulin for use in Afrezza from 2015 to 2019. The minimum order is for $161 million of insulin during the five-year period.
Afrezza has been approved in the United States to treat both Type 1, formerly called juvenile, and Type 2, formerly called adult-onset, diabetes. However, it must be used in combination with long-acting insulin in patients with Type 1 diabetes.
The company has said it expects to being seeking approvals to sell the drug in foreign countries.
“Sanofi is the ideal partner given their complementary product portfolio, their vast insulin market presence and a leading global commercial infrastructure,” said Alfred Mann, founder and chief executive of MannKind, in a statement. “Our profit-sharing agreement aligns the interests of MannKind and Sanofi to optimize development, commercialization and manufacturing costs.”
Shares closed up 40 cents, or nearly 5 percent, to $8.53 on the Nasdaq.