Indy 500 Puts Face on Afrezza

When the Indianapolis 500 takes place on May 26, an unlikely competitor will take part in the race: MannKind Corp. In an attempt to jumpstart sales for its inhalable insulin Afrezza, the Westlake Village-based biomedical company has signed a marketing agreement with racecar driver Conor Daly, who has Type 1 diabetes. The driver will make his debut with the Andretti Autosport team at the Indy 500. MannKind announced March 14 that it will be an associate sponsor of Andretti Autosport for this race, partnering with Daly on his No. 25 United States Air Force Honda. For the company, the race already appears a win-win. The biomedical company plans to use its associate sponsorship of Daly to raise awareness regarding diabetes treatment options. The campaign also links Daly’s human-interest story about living with diabetes to the Afrezza brand. “You’ll see MannKind Diabetes on the car, pre-events, post-events,” MannKind chief executive Michael Castagna told the Business Journal. “We’re going to bring people to the track and hopefully do some different races throughout the season,” Daly added. “We will take what they’ve got available out to the races and hopefully help people (and) share my story on a higher level.” Motorsport marketing Castagna said the Daly promotional effort will not be a one-and-done, noting other high-profile influencers with diabetes, such as Miami Dolphins quarterback Jay Cutler and “Empire” star Paul Sparks, who testified before Congress about how Afrezza changed his life. “You’ll start to see MannKind evolve in this world. We’re going to be a consumer-driven company,” Castagna said. Dan Kahn, chief executive of Kahn Media Inc., a Moorpark-based advertising and marketing firm with substantial automotive-world experience, is not involved in the MannKind effort. However, he considers the pharmaceutical firm’s Indy 500 sponsorship “an interesting move.” “The fact that Daly has Type 1 diabetes makes this a great fit and creates an interesting narrative,” Kahn told the Business Journal. While celebrity marketing deals don’t always go smoothly, Kahn believes this may turn out differently. “Motorsports sponsorship, particularly open-wheel racing, has been challenging over the past few years for some companies because the audience has been skewing older than it used to be in the ’80s and ’90s,” Kahn said. “But Indy has been having a bit of a comeback lately, and because this isn’t simply a ‘slap the logo on and hope for TV exposure,’ but a more integrated marketing program where the driver has this medical condition and uses the product – that feels like a good fit to me, and one that will garner both positive branding and hopefully some well-executed PR opportunities for both the driver and MannKind.” Castagna said Daly, who has gotten involved with Juvenile Diabetes Society, is poised to race the best run of his life come May. “As a racecar driver, he’s never had the best team around him but now he’s got a team hopefully to run a really good race,” Castagna said. Race to profitability The story of MannKind sounds like a long-distance race. The company was founded in 1991 by late billionaire Alfred Mann. Since then, the company has faced repeated near-death experiences, including a rejection of its application by the U.S. Food and Drug Administration, a reverse stock split and accumulated debt issues. Last year, for example, it reported a quarterly loss of $22.7 million for the second quarter, and the company had cash and cash equivalents of $26.7 million, leading some to question whether bankruptcy was imminent. But the situation turned around with a license agreement for MannKind’s inhalable drug technology with United Therapeutics Corp. that gave MannKind a $45 million upfront payment. After the FDA approved Afrezza in 2014, MannKind signed a marketing agreement with French biotech giant Sanofi. Its approach to the market targeted doctors, explaining the benefits of inhalable insulin. But sales failed to materialize, leading MannKind to take over the marketing and sales operations for the drug. “The diabetes market is a tough market,” said Southern California Biomedical Council leader Ahmed Enany. “It’s a conservative market – endocrinologists aren’t going to shift from one modality of providing treatment to others so easily.” MannKind observer Brian Marckx, an analyst at Zacks, told the Business Journal that he believes that MannKind was unfarily lumped into drama related to a previous attempt to commercialize inhalable insulin. Pfizer Inc. introduced Exubera in 2006, and it turned into a multi-billion-dollar failure for the company. “(MannKind) has had their hands full in trying to educate both doctors and diabetics about the benefits of inhaled insulin, which I think got a very unfair rap in Exubera’s day,” Marckx said. “We did quite a bit of background work on Exubera in order to understand whether the criticisms of inhaled insulin were valid. We found that Exubera failed largely due to lack of education, overstated side-effect risks and because it used an unwieldy inhaler.” “A lot of MannKind’s recent efforts have been focused on educating doctors about the clinical benefits of inhaled insulin and also debunking the idea that inhaled insulin is associated with pulmonary and cardiovascular risks – which contributed to Exubera’s failure,” Marckx continued. “In fact, when FDA approved Exubera, they had no evidence of pulmonary/cardio risks but required Pfizer to include a black box warning for exactly that – just to be overly cautious. So Afrezza is also ‘guilty’ by association.” Marckx said this dark cloud is lifting as MannKind cuts through the clutter with new research. “They recently announced new clinical data that further supports the claims of better A1C control with inhaled vs injected insulin,” the analyst said. “They’ve also been running (direct to consumer) campaigns in order to educate patients on the lifestyle and quality of life benefits of inhaled versus injected insulin.” Daly the driver The son of Irish former Formula One and Champ Car driver and commentator Derek Daly as well as the stepson of Indianapolis Motor Speedway President Doug Boles, Daly became the youngest driver in the country to win a senior Pro kart race at age 14. It was also the age that he learned that he had diabetes. “I got diagnosed and for a long time I was told not to say anything about it,” Daly told the Business Journal, for fear of losing such deals as a lucrative European contract he had signed. In 2008, Daly segued into racing automobiles, scoring five wins in the Skip Barber National Championship and five wins to become the Ontario Formula Ford 1600 Rookie of the Year. Two years later, Daly experienced a record-setting year as he swept the Formula Star Mazda championship with seven wins. He has won Firestone Indy Lights in Long Beach and the Indian MRF Challenge championship. Eli Lilly & Co. sponsored Daly in the 2016 Indianapolis 500. Last year, Daly, who was paired with fellow IndyCar driver Alexander Rossi, appeared on “The Amazing Race,” placing fourth. For Daly, now 27, spreading awareness of Afrezza and diabetes management in general seems natural to him. “I can’t wear a pump because in the race car, it’s too hot,” Daly said. Praising Afrezza, he added, “To have something fast acting is really cool.” Afrezza, according to Castagna at MannKind, makes “the high and lows of diabetes go away,” and he sees the product becoming a ubiquitous anti-diabetes product. Ultimately, MannKind wants to mainstream its product and make sure diabetics are aware of their options via this Daly Indy 500 campaign. “Our big focus is we remove the stigma,” Castagna said. Kahn commends MannKind for thinking outside its lane, as it were. “This is a tougher sell and aimed at a really specific audience,” he said. “So if they can execute a PR program making Daly a ‘poster boy’ for diabetics and how they can literally do anything with a little help from an inhaler, it could work well.”