Sanofi has handed back rights to inhaled insulin drug Afrezza to Mannkind, less than a year after its launch, after the diabetes treatment saw underwhelming sales.
Mannkind has insisted Sanofi's decision does not spell the end for the product and has pledged to find a new marketing partner for Afrezza, a dry powder inhalation formulation which is positioned as a more patient-friendly alternative to insulin injections.
Sanofi recorded sales of just $5m for Afrezza in the first nine months of 2015 following its launch in the US in February, a paltry return after agreeing in 2014 to pay up to $925m for marketing and distribution rights to the product. Around $200m of that has been received by Mannkind to date.
The lacklustre sales suggest patients with type 1 and 2 diabetes are simply not enamoured of taking insulin via the respiratory route - at least not in sufficient numbers.
Shares in Mannkind lost almost half their value yesterday as the news emerged, the latest chapter in the inhaled insulin story which is shaping up to be a tragedy of epic proportions.
MannKind had to wait until its third marketing application before finally receiving approval from the FDA, with the delays forcing the company to slash its workforce by 41% in 2011, and the total bill for development is estimated at around $1.8bn.
The inhaled insulin tale goes back much further, however. In 2006 Pfizer launched a similar product called Exubera - once again after a lengthy development process, only to withdraw it a year later on lacklustre sales and concerns about the risk of dosing errors with the product's inhaler device.
The disappointing performance of the drug also promoted other inhaled insulin developers - including Eli Lilly/Alkermes and Novo Nordisk/Aradigm to discontinue their own programmes.
Afrezza's poor sales performance is thought to arise in part from an FDA requirement that patients undergo lung function tests before it can be prescribed, as well as warnings against its use in people with respiratory diseases such as asthma and smokers.
In a statement, Mannkind said it will "promptly commence transition discussions" with Sanofi and expects the handover to take no more than six months.