Testing new lows

Testing new lows

It never ceases to amaze Diabetic Investor the lengths people will go to in justifying very bad decisions. We got our first taste of this when we examined the quest to develop a non-invasive glucose monitor, the supposed Holy Grail of diabetes devices. Back in the day you couldn’t swing a dead cat without coming across one company or another that had such a project. Conventional wisdom back then was that such a device would be a for sure hit. That if such a product made its way onto the market why would any patient chose to prick their fingers when they could measure their glucose levels non-invasively.

Well as it turned out this conventional wisdom turned out to be conventional stupidity as investors lost millions chasing this dream. Yet in spite of this the dream never died and has been reincarnated as the quest to develop a non-invasive continuous glucose monitoring system. Never mind that this quest too is a pipe dream as money continues to flow into these projects. While we suppose it’s possible that this can be achieved our experience tells us that millions more will be thrown away chasing this dream.

We mention this as we watch shares of MannKind (NASDAQ:MNKD) test new lows. Like the quest to develop a non-invasive glucose monitor, the dream of inhaled insulin has turned into a nightmare. Like non-invasive glucose monitoring the conventional wisdom surrounding inhaled insulin has turned into conventional stupidity. Yes on the surface it seems like a no-brainer that patients would prefer to inhale rather than inject insulin. That therapy compliance would increase if a patient could inhale rather than inject. It would also seem logical that more physicians would prescribe insulin therapy if patients could inhale rather than inject insulin.

This was the premise that made Pfizer believe in Exubera and Sanofi (NYSE:SNY) believe in Afrezza. Yet as we saw with Exubera and now with Afrezza the devil is in the details. That just because something looks good on paper or in a PowerPoint presentation this does not mean it will work in the real world.

Given the dismal performance of Afrezza would could say that Sanofi was a greater fool than Pfizer. That they should have learned from the Exubera disaster. Yet that would be too easy and actually not accurate. Looked at honestly Afrezza is much better product than Exubera, not only does it have a better delivery device but more importantly it’s a better insulin than Exubera. Sanofi likely reasoned that these two factors would allow Afrezza to succeed.

Yet as we have seen Afrezza is not succeeding which begs the question did it ever really stand a chance. We will not rehash the many mistakes made by Sanofi and say these blunders alone doomed Afrezza. Yes Sanofi majorly screwed up but quite frankly we’re not sure even if they had executed well that Afrezza would have done much better. As we have noted many times there are certain structural issues in the insulin market that stood in the way.

As the doomsday clock ticks down for MannKind and Afrezza one has to wonder whether this will be the end of the dream. Will everyone finally realize that inhaled insulin is nothing more than a niche product and not the mega-blockbuster that everyone thought it would be? Sadly we doubt it. As sure as day follows night another company will come along and say they have built a better mousetrap. That their inhaled insulin will succeed even though Exubera and Afrezza were major failures. Even more likely some major company will come along and buy into this malarkey and invest in the company.

All anyone who doubts this has to do is look at the non-invasive glucose monitoring dream. A dream which has been around much longer than inhaled insulin. A dream which in spite of numerous well documented failures continues to live on. This is the reason we believe that inhaled insulin won’t die, that it will live on.

So don’t be surprised when in the not so distant future we write about another company whose developing inhaled insulin. That they will insist their inhaled insulin will succeed, that they have learned from past mistakes. As Momma Kliff used to; “It’s better to live in fantasyland than actually deal with the harsh realities in the real world.”