MannKind Corp. Enters Royalty Agreement with Sagard Healthcare

MannKind Corp. announced on Tuesday a new royalty agreement with Sagard Healthcare. Under this agreement, Sagard Healthcare will receive a 1% royalty on sales of Tyvaso DPI inhalation powder, up to a maximum of $200 million.

In 2018, United Therapeutics Corp. obtained a license for Tyvaso DPI from MannKind and began marketing it in June 2022 after receiving approval from the U.S. FDA. Tyvaso DPI is used as a treatment for pulmonary arterial hypertension and pulmonary hypertension associated with interstitial lung disease.

As part of the original licensing deal, MannKind is entitled to a 10% royalty on sales of the treatment. However, under this new agreement, Sagard Healthcare will now receive a 1% royalty on net sales of Tyvaso DPI between October 1, 2023, and December 31, 2042.

To initiate the agreement, MannKind will receive an upfront payment of $150 million, with an additional $50 million if sales reach or exceed $1.9 billion by the end of December 2026. In case the milestone is not achieved, MannKind will receive $45 million if the sales reach or exceed $2.3 billion by September 30, 2027.

If neither milestone is met, MannKind will not receive the milestone payment and Sagard will not be entitled to any royalties for sales exceeding $3.5 billion in a calendar year.

MannKind's stock experienced a 1% premarket decrease and has decreased by 31% in the past 12 months, while the S&P 500 has seen a 24% gain.

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