MannKind Corp (MNKD) 2007 Q1 法說會逐字稿

Welcome to the MannKind Corporation's first quarter 2007 conference call. At this time all participants are in a listen-only mode. Later, instructions will be given for the question-and-answer session. (OPERATOR INSTRUCTIONS) As a reminder, this call is being recorded today May 11, 2007. Joining us today from MannKind are Chairman and CEO, Alfred Mann; President and COO, Hakan Edstrom; and the Chief Financial Officer, Dick Anderson.

I would now like to turn the call over to Dick Anderson, Chief Financial Officer of MannKind Corporation. Please go ahead.

Thank you, good morning. We appreciate you participating in today's call. Let me make one correction. Also on the call is our Chief Scientific Officer, Dr. Peter Richardson. I will summarize our financial results for the first quarter of 2007, as reported earlier today. Next, Hakan will provide an update on key accomplishments during the quarter and then Al will provide the outlook going forward. After that we will open up the call to your questions. Before we proceed further, please note that comments made during this call will include forward-looking statements within the meaning of federal Securities' laws. It is possible the actual results could differ from these stated expectations. For factors which could cause actual results to differ from expectations, please refer to the reports filed by the Company with the Securities and Exchange Commission under the Securities and Exchange Act of 1934, including our first quarter 10-Q, which was filed yesterday. This conference call contains time-sensitive information that is accurate only as of the date of this live broadcast, May 11, 2007. MannKind's management undertakes no obligation to revise or update any statements to reflect events and circumstances after the date of this call.

Let's begin with the financials. For the first quarter of 2007, total operating expenses were $77.3 million compared to $45.1 million for the first quarter of 2006. Total operating expenses increased by 8% from the previous quarter, the fourth quarter of 2006. R&D expenses were $63.8 million for the first quarter of 2007 compared to $35.9 million for the first quarter of 2006. This represents an increase of 7% from the fourth quarter of 2006. The increase in R&D expenses was primarily due to increased costs associated with the clinical trials and manufacturing for Technosphere Insulin. General and administrative expenses were $13.6 million compared to $9.1 million for the first quarter of 2006. This increase in G&Q expenses was primarily related to higher head count in employee-related expenses, as well as increased professional fees. G&A expenses increased by 12% from the previous quarter. At the end of March, we had approximately 590 employees, which represents an increase of 8% from the end of 2006.

The net loss applicable to common shareholders for the first quarter of 2007 was $73.1 million or $1 per share, based on 73.4 million shares outstanding. Compared with a net loss applicable to common shareholders of $43.6 million or $0.87 a share, based on 49.8 million shares outstanding for the first quarter of 2006. The increase in shares outstanding during the quarter reflects the impact of the successful completion of our public offering of 23 million shares of common stock in the fourth quarter of 2006. Our cash, cash equivalents, and marketable securities at the end of the first quarter totalled $365.6 million. That compares to $436.5 million for December 31, 2006, and $102.6 million for March 31, 2006. Our cash burn for the first quarter was $23.6 million per month, compared to $20.2 million for the fourth quarter of 2006 or an increase of 17%, primarily due to expenditures associated with the building of our new commercial manufacturing plant in Danbury, Connecticut. We anticipate our cash burn will continue to increase, particularly in the latter half of this year, as our Phase III trials continue and the rate of construction expands at Danbury. I would now like to turn the call over to Hakan Edstrom, our President and COO, who will review our product development and commercial readiness activities for the quarter. Hakan?

Thank you, Dick. Good morning, it's my pleasure to share with you the status of our product development activities, our commercial readiness activities, and the significant progress that we've made in the first quarter of 2007. We continue to increase the attractiveness of TI program, while also reducing development risk. Around the end of this month, we will have completed enrollment of all of our pivotal trials, the 009, the 102, the 103 and the 030. And I will also today share with you the results of our two-year cost initiative study. And the Danbury plant construction project is progressing on schedule, as are the other commercial readiness projects.

All our key Phase III trails for Technosphere Insulin or TI, that is status 102, 103, 009, and 030, are progressing well at centers in the U.S., Europe, and Latin America, and we have now completed the enrollment for the 009 trial and we will complete enrollment for the 102 trial around the end of this month. The 030 trial was fully enrolled last September. The 103 trial, which is a six-month study is expected to be fully enrolled around the end of this month. And for those of you that are not familiar with our nomenclature, study 009 is our 12-month pivotal efficacy study with approximately 600 patients with type I diabetes, evaluating Technosphere Insulin versus prandial rapid-acting insulin analog, both using combination with basil insulin. We began enrollment in study 009 in the first quarter of 2006. Study 102, which is under an SPA is our pivotal efficacy study in type II diabetes comparing TI to premixed insulins over a one-year period. This study is evaluating approximately 650 type II diabetes patients.

Study 103 is evaluating the efficacy of TI alone or in combination with metformin in over 500 type II diabetes, who are not achieving the desired glucose control with the combination of metformin and sulfanerea. This study will be important in establishing TI's therapy earlier in the progression of the disease, thus enabling label expansion. We began enrolling patients in this study in the second quarter of 2006 and, as I stated earlier, we expect to complete enrollments by the end of this month. Study 030, which is also under an SPA is our two-year partner safety study of Technosphere Insulin incorporating two designed strategies. The first compares pulmonary function in two groups of patients, type I and type II patients using either TI in combination with another therapy or treated with existing therapies, be they oral and/or injectable. The other component in the study that compares pulmonary function in patients with diabetes who are not treated with TI to a group of healthy subjects with normal pancreatic function. We considered this trial to be on the critical path for filing and we successfully completed enrollment for this study in September of 2006 with 261 patients.

Based on the progress of all of our pivotal clinical trials, we remain on target to file an NDA for Technosphere Insulin by the end of 2008. In addition, we have now received a completed evaluation of data from our two-year carcinogenicity study with animals injected with Technosphere Insulin, Technosphere alone as compared to air controls. Subject to final orders of the study, I'm delighted to confirm that the results show no carcinogenic potential for either TI or Technosphere and no evidence but normal growth stimulation in the lung. And we will shortly start our final long-term study which is a six-month transgenic mice study. That is to further support the reassuring profile we've seen to date in our tox studies. The pre-clinical toxicology and carcinogenic studies will certainly support the finding of our NDA for Technosphere and also support future products based on the Technosphere platform.

In addition to advancing our Phase III trials, we have also continued our focus on commercial residence. We are on schedule for the completion of the major construction phase of our Danbury manufacturing plant expansion, targeted for the end of 2008. We are also preparing for an FDA preapproval inspection shortly after we file the NDA. And as an example of our manufacturing progress in our Danbury plant, we have to date manufactured over 6.9 million TI cartridges in support of our Phase III clinical trials, tox studies, and manufacturing testing.

Now let me transition for a little while over to our oncology programs. In January of this year, we commenced an open label Phase 1 clinical trial of MKC-1106, the first of our cancer immunotherapy program's product candidates. The primary objective of this Phase I clinical trial is to evaluate the safety, tolerability and pharmacological response in cancer patients with advanced sorted malignancies in a variety of tumor types and measurement of objective tumor response is the secondary end point. Our cancer therapy program utilizes the body's own immune system to help eradicate the tumor cells. Our approach to the therapy is quite different than others and we believe it to be more powerful. For example, our system marshals substantially more killer T cells than prior systems, without relying on microbial vectors. Our approach uses a naked plasma DNA plus peptide-based compounds that correspond to tumor-associated antigens that are expressed in the range of solid tumors. For example, the MKC-1106 consists of three components, a plasmid that encloses the pharmacological active elements from two tumor-associated antigen, known as PRAME and PSMA, and two peptide analogs corresponding to epitopes from these antigens.

We believe that our approach addresses several deficiencies inherent in earlier approaches to cancer immunotherapy, such as the reliance of patients, tissue, or cells to manufacture the pharmaceutical composition or the limited immune response afforded by earlier peptide-based approaches. We anticipate at least 24 patients to be part of this initial study at several clinical sites. The initiation of this study represents and important and exciting milestones for us, as we continue to dedicate ourselves to providing therapeutic products for people suffering from diabetes and cancer. One of our 2007 goals was to initiate clinical trials for a second drug to be delivered with our proprietary Technosphere formulation. I'm pleased to announce that we have initiated the Phase 1 trial with MKC-253, a formulation of GLP-1 delivered on Technosphere particles. This is an example of our commitment to expand our proprietary Technosphere formulation for the delivery of other drugs. Our initial dose escalation study will include approximately 26 healthy individuals and we will evaluate patient tolerability and safety and measure drug and glucose levels over several hours following a meal. So with that overview of our programs to date, I would now like to turn the call over to Al Mann, our Chairman and Chief Executive Officer. Al, please go ahead.

Thank you, Hakan, and good morning, ladies and gentlemen. We've been providing these updates on our progress, since we became a public company in 2004. Today we are in a much stronger position. Our trials are on track and, around the end of this month, we expect all of our key Phase III trials for Technosphere Insulin to be fully enrolled. Our commercial readiness program is also on track. The clinical progress we are making only strengthens our confidence in Technosphere Insulin. To date, we have treated over 2,500 patients with TI, representing a total of approximately 300,000 days of exposure and the trials to date have all met our objectives. We continue to see significant efficacy benefits and no safety shortcomings with TI. As evidenced by our findings, our trials are consistently demonstrating the previously-identified differentiating qualities of TI compared to all other diabetic therapies.

With TI, we have seen essentially no need for complicated meal titration, no abnormal meal excursions, virtually no risk of severe hyperglycemia, no weight gain, and no adverse affect on pulmonary function. Some people have tried to compare TI to several pulmonary insulins. We say to you that this product should not be compared to those products, which simply eliminate the injections of conventional insulin therapy, nothing more. Technosphere Insulin is a unique therapy for diabetes, different from all other diabetes therapies of all kinds. We know of no other therapy, either in commercialization or in development, that comes even close to the kinetics of TI, with a Tmax of 12 to 14 minutes, that is almost as fast as in a person with a healthy pancreas. We believe that Technosphere Insulin will have an important role to play in improving both safety and efficacy of insulin therapies. We also believe that TI has the potential for making insulin therapy desirable very early in the treatment of Type II diabetes.

This has not been current medical practice until now, because the problems with insulin therapy have outweighed for any benefit for early stage type II patients and their prescribers. We are confident that once the market becomes more aware of our product differentiation, TI will emerge into a class of its own. In addition to TI's clinical development, we are also committed to its commercial success. Let me state very clearly that our strategic objective is to partner our TI product and this has not changed. In fact, we believe that our recent successes, the completion of enrollment around the end of this month of all the remaining pivotal trials and the completion of our two-year carcinogenicity study, continue to enhance the value of our program to potential partners. We are continuing discussions and hope to reach a collaboration agreement for TI that will reflect the program's accomplishments.

In the second quarter, we will continue our progress towards extending our product pipeline and demonstrating our commitment to providing therapeutic products for diabetes and cancer. In addition to our Phase 1 cancer immunotherapy trial, we have initiated a trial with the Technosphere GLP product candidate. Why GLP? The mode of action of GLP is quite different from that of insulin. GLP stimulates insulin secretion, suppresses glucagon secretion and slows gastric (inaudible). There are some indications in animal studies that GLP may increase beta cell mass and maintain beta cell function. We are evaluating several forms of GLP and we hope to show that prandial administration can more closely simulate normal physiology.

We also continue to focus on strengthening and building our organization in anticipation of a far larger company in the future. As disclosed in our proxy filing, at this year's annual meeting, we are nominating two new members of our Board of Directors, Barry Cohn and Heather Murren. Barry Cohn was a senior executive with Merck & Co. from 1977 to 1992, in his last role, serving as President of Merck's International Division. Since his retirement in 1992, he has worked with Roche and Chugai and he played a very important role in Roche's acquisition of 51% of Chugai. Heather Murren is presently Co-Founder, Chairman, and Chief Executive Officer of the Nevada Cancer Institute. She retired from Merrill Lynch as Managing Director, Global Securities, Research and Economics in April of 2002. Her role at Merrill was group head for global consumer products equity research.

We have previously said that 2007 was the year dedicated to keeping our TI program on schedule. As we have demonstrated on this call, we continued to meet our program milestones and we remain on track to file our NDA for Technosphere Insulin in December 2008. We are grateful to you all for your ongoing support and your commitment as we reach and exceed our goals. Thank you all for joining us today and thank you for continued support. We'd now like to open up the call for your questions. Operator?

Thank you. (OPERATOR INSTRUCTIONS) Our first question today is coming from Annabel Samimy.

Hi, I'm from UBS. Thanks for taking my call and congratulations on a positive study. That's pretty comforting for a growth factor in the lungs. So, I'm happy to see that. I had a couple questions. We understand and you understand and probably some of the thought leaders understand that Technosphere insulin is a different product from Exubera or any of the rapid-acting insulins, but do you have any plans on -- do you feel the need to conduct any further marketing studies outside of 103 that you're doing right now, to educate a broader primary care physician base on the differences between your product and any other insulin product out there?

Hi, Annabel, it's Peter Richardson here. Yeah, I think you've actually hit on something that's important in terms of we work on the 3b and 4 program leading to commercialization. At the present time, we've really been concentrating on successfully recruiting our registration studies and laying a very firm foundation from which we can approach an NDA. And so for the next year, we'll be working with potential subscribers and patients in understanding how we produce a message that concerns the differentiation of Technosphere and allows them to use this product in a way which will be very different from other inhaled insulins. And I think that getting further insights into that is something that we're actively doing and will be very important as we (indiscernible - accented language).

Is that going to be through an actual formal study, or just the education process?

As we approach commercialization, we'll be doing formal studies in terms of gaining insight. We've already got activities in our commercial group in terms of getting insight into prescriber habits. We've done some limited studies and a normal part of the launch process will be to get some in-depth studies of understanding messaging and what we need to do to launch this.

Great. And then a couple just other quick questions. The data at ADA, you're going to have two posters over there. What's the specific incremental information might that be or is it just the same data from before? And also, I think you've probably addressed this question before, but just remind us, is there any kind of interim analysis of study 030 from an efficacy perspective?

Not at all. At the ADA, we actually have three abstracts, two of which will be presented in poster form. The first one is looking at the weight change or lack of weight change in studies that we've done so far with Technosphere Insulin. The second one is around our pulmonary program and the data that we have there in terms of the very intensive control program we've put around there and looking very carefully at pulmonary function in this very extensive control program that's in place. And in terms of the interim analysis, I think we said the last call, there is a pre-fund interim analysis for vertical 030, but we don't propose that we'll be presenting or showing those results. That will be very closely maintained within the data safety managing board to ensure compliance, of what we need to do for the agency.

Okay, great. Thank you very much.

Our next question comes from Hari Sambasivam. Your line is open.

Yes, thank you. Good morning, just a couple of quick questions. One is, could you give us a sense of where you are with your decision regarding the bulk insulin supply, etc.? The second question is what is the rationale for a super rapid-acting GLP-1, so to speak. Because I was just under the impression that most other development programs are actually going the other way, which is long-acting so that you don't get the nausea and vomiting that is associated with the GLP-1 product? So maybe -- I'll turn it back to you.

Hari, this is Hakan. In regard to supply of critical components, insulin certainly being one of them, we are comfortable where we're sitting right now and we are certainly working with our suppliers and also looking at alternate suppliers on a go-forward basis to make sure that that will not be something that would restrict our ability to enter the market. Peter, could you please --?

I think you're using the terms of "super rapid" in terms of GLP-1, we're not using that. We're using in terms of exploring potential for prandial administration. As you know, in normal physiology, GLP-1 is very closely related to transial food intake in, again, the synchronicity as well as a background. And I think that we are we are looking at in our first study is demonstrating the ability to deliver the GLP peptide by inhalation. We have a program in terms of understanding the time action profile and optimizing that in terms of what benefits can be gained from transial, as opposed to providing more constant background. The data and, I think, the science around this is really interesting in terms of understanding that. I think it's a fascinating opportunity that we have to explore, with Technosphere Insulin having demonstrated the tolerability and safety of the Technosphere particle and being able to, again, use what we believe will be unique pharmacokinetics or the unique ability to modify the pharmacokinetics on the Technosphere particle to optimize and, perhaps, more closely mimic the physiology. But I think diabetes, and in other metabolic conditions, as you know, the importance are in terms of satiety and obesity. And those, I think, are interesting things all around the GLP family of peptides.

Thank you.

Your next question comes from Geoff Meacham. Your line is open. Please state your company name.

Hi. This is [Joe Elsell] calling in for Geoff Meacham, JPMorgan. Thanks for taking my call. I had a couple questions here. The first of which is, I noticed that the R&D spend for this quarter is a little bit above kind of what we expected. I understand the reasons for it, but I want to get a feel and a sense for whether or not you see this kind of being the trend going forward in subsequent quarters?

We have said, for the last few quarters, that our burn rate will continue to increase due primarily to the additional patients on our pivotal trials and the patients on our special population studies. And in addition, we said that the manufacturing activities will continue to increase and we have now the construction over 2007 and 2008 of our commercial manufacturing plant in Danbury. As I said earlier on the call, I expect that the burn rate will increase, particularly in the latter half of this year.

Okay. I mean, just the -- for modeling purposes, is it safe to assume then that the increase in the rate, we can kind of extrapolate more or less linearly from here going forward through the rest of the year?

I can't make that prediction for you.

Okay, thanks. One last question then. Definitely excited about the GLP-1 program for Technosphere and kind of in line with things that you guys said in the past, just wanted to get a feel for whether or not you guys were close to any other compounds being tagged to Technosphere for pulmonary delivery?

Obviously, we've got a major opportunity in terms of delivering products on the Technosphere platform. We've used GLP as an example again of one that may be related to having the benefits of the pharmacokinetics on our ability to deliver by inhalation at mealtimes. We have a program looking at other compounds in very -- in early phase. We have gone to considerable trouble now in developing an ability to screen the peptides and other compounds on the Technosphere platform. When we see opportunity to not just bringing something that is simply more convenient, but something that will offer something to patients in the same way as we have with Technosphere Insulin, that addresses a real area of unmet need and allows us to use the unique Technosphere particle, then that is something that will advance into development. And yes, we do have activities looking at that, but we really have been developing a very careful screening pre-clinical program that we can identify those with potential before coming into the clinic.

Okay, thanks a lot.

And our next question comes from Jon LeCroy. And please state your company name.

Yeah, from Netaxis. Thanks for taking my call. Could you address what you think the limiting factor is for a partner? Is there some data set that partners may be wanting completed before they would offer into a partnership or is it just a financial limit on that end? And then my other question is, if the two-year trial 030 ends in September 2008, how is it you that could file still in 2008, thinking that you would have to analyze that data and then prepare what looks like it will be a relatively large filing packet? Thanks.

Jon, this is Hakan Edstrom. When you talk about the partnership programs -- really, the process is that, what we're doing is we're meeting with the potential partners and asking them to make a capability presentation, in terms of what could they offer in terms of the strategic benefit of this product, particularly on going on a worldwide basis with quick penetration. And then certainly working very careful in making sure we believe it to be a successful partnership. So while the economics are important, I would say they are not really what's driving the whole thing. It's more making sure that we believe, as well as the partners, that this could be something successful and they fully understand and very well appreciate that we have a clearly differentiated product, as mentioned. The only thing we have in common with other pulmonary insulins is that ours happens to be delivered pulmonary, but the mechanism and action is very, very different. So I would say that there is nothing in terms of data points, at this point in time, that is holding us back. However, I would say that the results of the two-year core study certainly have been very, very helpful in regards to, again, assuring that long-term we do not see any problems with the product. Peter, would you please address the trial?

It's a good question in terms of an August/September end for 030 and a filing late in 2008, certainly presents some challenges. It's certainly possible in terms of executing an NDA file with the last visit of a pivotal study coming out that three months before that, would be something that would be really approaching best in class in the industry. And we have been looking at that very carefully. We have maybe been somewhat fortunate, but I'd like to say it was actually our ability to execute on the programs, in terms of the timing of the status of each of the pivotal studies, and carefully planning a sequence of database locks, which will now be occurring at the end of this year through each month of next year. We have a series now where we really know that we will be separating out of the database lots of each of the pivotal studies, as well as the incorporation of the special population studies that are ongoing, so that we have a good plan for the NDA and we understand both the critical rate limiting factor protocol 030 and what we need to do, in terms of collecting the data from the studies locking on an ongoing basis. And again, this is a matter of execution for the organization and we've merely been building and focusing very much on getting the expertise together to allow to us submit an electronic NDA in the time frames which -- those which I'm familiar with working with in the industry, as a whole. But you're right, it is aggressive and we have some challenges. It's a matter of executing on that.

One more follow-up, if I may. Are you seeing the competition to get patients into the trials increasing, with two other companies running big Phase III inhaled insulin trials. And then I'm sure Pfizer is running some sort of post-marketing trials. Is that something that, it's getting harder to find patients?

You're right. In the diabetes area, there's enormous competition for patients. This is a very active area. I would be very impressed by the Company's ability to move with our partners in the same areas that we've worked with to address this in terms of recruitments in the U.S., Europe and Latin America. Still, the majority of our patients are recruited from the United States. But we've had to apply really state-of-the-art recruitment methodologies and to bring these studies in at the time we are doing in terms of 009 completing recruitment on 102, 103, now is knowing that we will have these and have the ability to lock those databases in 2008 as planned. Yes, it's been a significant challenge and I'm very proud of the organization that we've managed to do it.

All right. Thank you.

Thank you. Our next question comes from Thomas Wei and please state your company name.

Thanks, I'm from Piper Jaffray. I just had a couple of questions here. First, on the guidance for the burn rate, can you help us with any sense of how we should be thinking about the monthly cash burn rate exiting this year?

Thomas, what we said become last fall, when we were raising money is that, based upon the cash raised in December, and assuming no partnership and assuming that we do not use the $150 million line of credit from Al, which is our most conservative approach, we would have raise funds by the end of this year.

Okay, thank you, that's helpful. I also just wanted to ask about this six-month transgenic mouse study. What exactly is that for, and perhaps I was mistaken, but I thought all of the toxicology studies had actually been completed and the carcinogenicity one was the final one we were looking for?

This is Peter. The requirements in terms of carcinogenicity are two species and the model has traditionally been to do two two-year carcinos. We've just got the readout, as you know, from our two-year rap carcino. And the transgenic is actually, again, looking at really what's a very robust methodology for investigating this, allowing us to do that in the time frame that we've set. We've actually been in a discussion for quite a period with the agency around the design of this and I'm very pleased to say that they've accepted the design of the transgenic study, we've got an agreement on dosage and we're starting that. I think that that's actually a really good step forward for the organization. And remember, this will be very important in terms of not only laying the platform on the basis of the very reassuring data that we've seen from the carcinogenicity study that we've just completed, but enabling the platform of Technosphere alone to have a robust data package around carcinogenic potential, as well as looking at carcinogen studies that we're doing here, in terms of insulin and the interest in that in terms of insulin in this area, where we've actually taken that decision to go out and do the definitive studies to support a label.

And is it a study -- is it a study of Technosphere Insulin, or just the Technosphere component?

It's TI, Technosphere and air control.

And just so that I'm perfectly clear here, this is -- this was part of the plan for the pre-clinical toxicology, it was not something that has been added as a result of an FDA request or some prior data?

No, it's no result of prior data and it's not been added. It's been something that we've been working on ever since I've been here, Tom.

Okay. Great. And then just lastly, to clarify on the 030 study and the whole NDA submission, are you allowed to submit partial data from the 030 study and supplement the final data as part of the 120-day safety update, or does the whole thing need to go into the initial NDA filing?

I would anticipate that we would need to put the whole thing into the NDA filing and that is what our plan is really carefully constructed to do. I think, yes, there are opportunities in terms of supplementing at the 120-day update, but that's usually not something that we would want to do. Our aim is to have all patients off treatment from 030. There's no follow-up from that and we've got a plan for doing that and really trying to put in the best package that we can at the time of the NDA and not relying on 120-day update. Obviously, we will be looking on opportunities should -- of updating further data in the 120-day update, as is normal.

Thank you.

Thank you. (OPERATOR INSTRUCTIONS) Our next question is coming from Elliot Wilbur. Please state your company name.

Hi, good morning. CIBC World Markets. Just one question for Al. The other day on its conference call, Nektar made some uncharacteristically optimistic comments about its second generation Exubera device, relative to potential competition from both MannKind and Alchemies. And I know that that's been somewhat of a stealth program, not a lot of information out there. But I guess, to the extent you have any competitive intelligence on their second generation device, do you believe that it has any potential advantages other than just perhaps size?

We know of no advantages. They've been very -- it's been very interesting. They've been showing a little device, not saying that this is what they are going to have, but saying that this is like what we are going to do, but as they been showing that to various people at investor conferences, whatever it is, what we have seen in the Exubera product is that it takes a great deal more energy to deagglomerate the powder than ours. Anyway, we have a very tiny little cartridge or capsule compared to their chamber. But at the end of the day, all we can imagine that they would do would be to have a smaller device. And what I've tried to say, in this talk and in other presentations we've made, you can't really compare our products based on the device.

In my opinion the size of the device is -- of our device is an important but not very -- not really the significant differentiating factor of our therapy. It is our kinetics and I cannot see anyway that a different device is going to give them better kinetics. We cannot really be compared to other pulmonary insulins. It doesn't make any sense. They all peak in roughly an hour in the insulin -- in plasma insulin concentration. And in our case, we peak in 12 to 14 minutes. The normal body -- the normal human pancreas is able to create a peak of insulin in a little under 10 minutes. We're not quite as fast, but we're darn close to the same as a normal healthy pancreas and it seems to make an enormous difference and it has to be that fast in order for this difference to really be effective to -- in eliminating things like hyperglycemia and the need for titration and all these other factors that we've seen in our -- consistently in our studies. And you don't see that when you talk about an hour or 40 or 50 minutes or whatever in Tmax. And so you can't just look at our device. We think that's important for convenience, but not really what differentiates us.

All right. Thanks for the insight. That was my only question.

Thank you. Our final question today comes from Annette Larson. Please state your company name.

Yes, hello. It's Annette Rye Larsen from Gudme Raaschou. I think it's very exciting to see you expanding into the GLP-1 area and I have a couple of questions related to that. First of all, of course, I wonder about -- I want some clarification on this prandial issue, because I'm also surprised by that. Do you expect that it needs to be taken at every meal during the day or what are your thesis about that? And then I wonder, is this a compound you have in license or gained any rights to, any kind of royalties attached to that? And then, of course, I also wonder about -- you put a lot of effort into explaining that your inhaled or pulmonary insulin differs in mechanism of action from other inhaled insulin. Is that also how you look at this GLP-1 area that you have now entered into, of course apart from being an inhaled GLP-1? Thank you.

Yes. Hi, It's Peter. I think those are really very good questions. And what we are actually doing at the present time is using the opportunity now to do some early studies in man to better understand the importance of prandial synchronization with GLP-1, which is there in the literature and it's well known, that prandial is associated with digestion and food intake, as we've seen with insulin. I think what we're here, is that the single stage to that which we were with with insulin, so if you remember, for many years, we were looking at trying to deliver at constant background of insulin. And it's only when you have the opportunity to deliver something in a convenient form, its' got synchronization, it's the same with Technosphere Insulin, you begin to understand potentially, the importance of underlying basic normal physiology.

So our goal will be to try and, again, understand how that can be done using a product on Technosphere and our other studies are to better understand that, understand our dose window, and then the sum of the therapeutic effects. I hope that we'll have data on that as we move through, but clearly there's a series of experiments that need to be done in terms of understanding that and also any modification to the basic peptide to after-the-time profile action. I can say that the one that we're using at the moment does not, as far as I know, have any royalty or any other encumbrances in that way.

Annette, did that conclude your question?

Well, yeah, of course. I also wonder about this mechanism. Is it possible for you to give more information about the mechanism of action of this GLP-1, how it compares to other GLP-1s in the market, apart from being pulmonary-delivered?

The present ones on the market are GLP-1 analogs. I think in terms of -- we'll be looking in terms of the basic peptide and looking at exploration of whether modification of the peptide is needed in order to result in effects that we better need. But our initial studies will be done with a basic peptide.

Okay, thank you very much.

Thank you. That does conclude our questions -- actually, I'm sorry, we have one more question from Thomas Wei. Your line is open.

Thanks for taking the follow-up. I might have just missed this last part while I was dialing in for a follow-up, but did you say that it's with a native GLP-1 or is it a GLP-1 analog and do you understand if, how -- whether or not you've lost some potency in the process of analoging the GLP-1?

Thomas, we're actually evaluating more than one analog of GLP, more than one formulation of GLP, so we're not ready to comment on that.

Okay. Then just lastly, would love to get your thoughts on Biodel's Viaject and what you make of their program?

First, let me say that we don't really want to comment about Solomon Steiner or Biodel or their intellectual property. I think you need to judge that for yourselves. That said, let me say that Biodel claims that their Tmax for Viaject is 33 minutes, which would be faster than for current commercially available rapid-actions insulins, however 33 minutes is not nearly as fast as TI's, with 12 to 14 minutes. It's very close to the speed of release that you see in a healthy pancreas. We think that this differentiation is very important and if you look at some of their data on things like hypoglycemic events, for example, they haven't published very much, but what they have shown, suggests that there is a significant difference.

Thank you.

You bet.

Okay. That does conclude our questions for today. I will now turn the call back over to Management for closing comments.

Well, once again, we've had a very successful quarter. We've completed a lot of our milestones, going forward with our various trials and we're very pleased that this month we will have completed enrollment of all our pivotal trials, that we're on course for completion of our manufacturing facility in time, well in advance of where our need for commercial readiness, with the addition of our cancer, and we have several cancer immunotherapy products and the first trial is underway now, and with the first of several of our Technosphere expansion programs. We're quite pleased with the progress for this past quarter and we look forward to continuing progress over this year and the years to come. Thank you very much for joining us and we look forward to seeing and speaking with you next quarter.

And that does conclude today's conference and you may disconnect at this time.