MNKD 10-K & 10-Q changes, risk factors and insider trading

Successful commercialization of therapeutic products is subject to many risks, including some that are outside our control. There are numerous examples of failures to fully exploit the market potential of therapeutic products, including by biopharmaceutical and device companies with more experience and resources than us. Products that we commercialize ourselves (including Afrezza, Furoscix and any products that we may develop or acquire in the future) and the product that is commercialized by our current collaboration partner (including future products that may be commercialized by a collaboration partner) may not gain market acceptance among physicians, patients, third-party payers and the healthcare community. The degree of market acceptance of our or a collaboration partner’s products depends on many factors, including the following:

We have built aOur sales forceforces that promotespromote our products to endocrinologistsdifferent andtarget selectedgroups primary careof physicians. In order to successfully commercialize anyour approved products, we must continue to build our sales, marketing, distribution, managerial and other commercial capabilities. The market for skilled commercial personnel is highly competitive, and we may not be able to hire all of the personnel we need on a timely basis or retain them for a sufficient period. Factors that may hinder our ability to successfully market and commercially distribute our products include:

If we are unable to maintain an effective sales forceforces for our products, including potential future products, we may not be able to generate sufficient product revenue in the United States. We are required to expend significant time and resources to train our sales forceforces to educate physicians about our products. In addition, we must continually train our sales forceforces and equip them with effective marketing materials to ensure that a consistent and appropriate message about our products is being delivered to our potential customers. We currently have limited resources compared to some of our competitors, and the continued development of our own commercial organization to market our products and any additional products we may develop or acquire will be expensive and time-consuming. We also cannot be certain that we will be able to continue to successfully develop this capability.

WeAfrezza useand Tyvaso DPI are manufactured by us in our Danbury, Connecticut facilityfacility, towhere we assemble the inhalers from their individual molded parts, formulate both the Afrezza and Tyvaso DPI inhalation powders, fill plastic cartridges with the powders, package the cartridges into secondary packaging and assemble the final kitskits. forIf certainand stock-keepingwhen units.needed, Otherwe semi-finishedalso goodsutilize area assembledcontract intopackager theto assemble final kits for commercial sale by a contract packager.sale.

As demand for our products increases, we may have to invest additional resources to purchase components, hire and train employees, and enhance or expand our manufacturing processes.capabilities. If we fail to increase our production capacity efficiently, our sales may not increase in line with our forecasts and our operating margins could fluctuate or decline. In addition, we may be unable to support commercialization of Tyvaso DPI.

InUnlike addition,Afrezza weand relyTyvaso DPI, which are assembled and formulated domestically, V-Go is wholly manufactured on our behalf by contract manufacturers located in Southern China to manufacture V-Go.China. Our contract manufacturer uses MannKind-ownedMannKind-owned, custom-designed, semi-automated manufacturing equipment and production lines to meet our quality requirements. Separate contract manufacturers in China perform release testing, sterilization, inspection and packaging functions. As a result, our V-Go business is subject to risks associated with doing business in China, including:

These risks may be exacerbated by our limited experience with V-Go and its manufacturing processes. If V-Go does not continue to qualify for duty-free treatment, any tariffs that apply to imported goods from China could materially and adversely affect our margins on V-Go sales.

For the commercial manufacture of inhaled drug products, we need access to sufficient, reliable and affordable supplies of raw materials for formulating powders, such as FDKP, as well as other components, such as the inhaler,inhaler and the related cartridges and packaging materials.cartridges. For Afrezza, we also require a supply of insulin. Currently, the only source of insulin that we have qualified for Afrezza is manufactured by Amphastar. We must rely on all of our suppliers to comply with relevant regulatory and other legal requirements, including the production of insulin and FDKP in accordance with cGMP for drug products, and the molding of the inhaler and cartridges components in accordance with QSRs.QMSRs.

For certain other components, such as packaging materials, we obtain materials from a limited number of suppliers, including some parts and components that are purchased from single-source vendors. For outsourced products such as Furoscix and V-Go, this is also true for some of the components required by our contract manufacturers. Depending on a limited number of suppliers exposes us to risks, including limited control over pricing, availability, quality and delivery schedules. In addition, we do not have long-term supply agreements for such components and, in many cases, purchases are made on a purchase order basis. As a result, our suppliers have no obligation to manufacture for us or sell to us any given quantity of components. Because we do not have long-standing relationships with all of the suppliers in our suppliers,supply chain, we may not be able to convince them to continue to make components available to us unless there is demand for such components from their other customers. If any one or more of our suppliers cease to provide us with sufficient quantities of components in a timely manner or on pricing and quality terms acceptable to us, we would have to seek alternative sources of supply. Because of factors such as the proprietary nature of our products, our quality control standards and regulatory requirements, we cannot quickly engage additional or replacement suppliers for some of our critical components.

In addition, materials sourced from suppliers located outside the United States have or may become subject to tariffs under U.S. trade policies. For example, we expect that future orders of V-Go devices, which are manufactured in China, will be impacted by a 10% tariff on imports from China that the current administration imposed via an executive order in January 2025. Components made domestically from imported materials, such as steel and aluminum,materials that are currentlyor become subject to tariffs arewould alsobe expected to become more expensive in the future. These and any future tariffs will increase our cost of goods and decrease our operating margins.

We may also have difficulty obtaining similar components from other suppliers that meet the requirements of the FDA or other regulatory agencies. Although we conduct our own inspections and review and/or approve investigations of each supplier, there can be no assurance that the FDA, upon inspection, would find that the supplier substantially complies with the QSRQMSR or cGMP requirements, where applicable. If a supplier fails to comply with these requirements or the comparable requirements in foreign countries, regulatory authorities may subject us to regulatory action, including criminal prosecutions, fines and suspension of the manufacture of our products. If we are required to find a new or additional supplier, we will need to evaluate that supplier’s ability to provide material that meets regulatory requirements, including cGMP or QSRQMSR requirements, as well as our specifications and quality requirements, which would require significant time and expense and could delay production.

Our future revenues and ability to generate positive cash flow from operations may be affected by the continuing efforts of government and other third-party payers to contain or reduce the costs of healthcare through various means. In the United States, there have been several congressional inquiries and proposed and enacted federal and state legislation designed to, among other things, bring more transparency to product pricing, review the relationship between pricing and manufacturer patient programs, and reform government program reimbursement methodologies for products. For example, the Inflation Reduction Act of 2022 (“IRA”) limited insulin copays to $35 per month for Medicare Part D beneficiaries starting in 2023. Further, the U.S. Department of Health and Human Services (“HHS”) imposes rebates on many Medicare Part B and Medicare Part D products to penalize price increases that outpace inflation on an annual basis. In addition, HHS has been empowered to negotiate the price of certain single-source drugs that have been on the market for at least seven years covered under Medicare as part of the Medicare Drug Price Negotiation Program. Each year up to 20 products will be selected by HHS for the Medicare Drug Price Negotiation Program. Products subject to the Medicare Drug Price Negotiation Program are expected to experience a significant reduction in reimbursement from the Medicare program on a per unit basis. If coverage and adequate reimbursement are not available, or are available only to limited levels, we may not be able to successfully commercialize our current and any future product candidates that we develop, which could have an adverse effect on our operating results and our overall financial condition. In certain foreign markets, the pricing of prescription pharmaceuticals is subject to direct governmental control. The European Union provides options for its member states to restrict the range of medicinal products for which their national health insurance systems provide reimbursement and to control the prices of medicinal products for human use. A member state may approve a specific price for the medicinal product or it may instead adopt a system of direct or indirect controls on the profitability of the company placing the medicinal product on the market.

the costs of developing Afrezza and of commercializing Afrezza and V-Go on our own in the United Statesproducts;

actions taken by the FDA and other regulatory authorities affecting Afrezza, Furoscix, V-Go, Tyvaso DPI, our product candidates or competitive products;

We have raised capital in the past through borrowings and the sale of equity and debt securities and the sale of certain assets. In the future, we may pursue the sale of additional equity, debt securities and/or assets, or the establishment of other funding facilities including asset-based borrowings. There can be no assurances, however, that we will be able to raise additional capital in the future on acceptable terms, or at all. Volatility and disruptions of the global supply chain and financial markets, if sustained or recurrent, could prevent us or make it more difficult for us to access capital.

Our ability to achieve and sustain positive cash flow from operations and profitability depends heavily upon successfully commercializing our products, and although we had positive cash flows from operations and net income in the year ended December 31, 2024,2025, we may not continue to generate positive cash flow from operations or be profitable in the future. In addition, we cannot assure you that we will maintain a level of cash flows from operating activities sufficient to permit us to make scheduled payments on our insulin purchase commitments and debt obligations. If our cash flows and capital resources are insufficient to fund our obligations, we may be forced to reduce or delay capital expenditures, sell assets or operations, seek additional capital or restructure or refinance our obligations. In the past, we have had losses that have had, and we may in the future have losses that have, an adverse impact on our working capital, total assets and stockholders’ equity.

In addition, we may from time to time seek to retire or purchase our outstanding debt through cash purchases and/or exchanges for equity securities, in open market purchases, privately negotiated transactions or otherwise. Such repurchases or exchanges, if any, will depend on prevailing market conditions, our liquidity requirements, contractual restrictions, and other factors. For example, in December 2024, we exchanged an aggregate principal amount of approximately $193.7 million of our senior convertible notes for 26,749,559 shares of our common stock and a cash payment of approximately $89.2 million, and we may seek to retire or purchase the remaining senior convertible notes. The amounts involved in any such transactions, individually or in the aggregate, may be material. Further, any such purchases or exchanges may result in us acquiring and retiring a substantial amount of such indebtedness, which could impact the trading liquidity of such indebtedness.

Afrezza has been approved in the United States, Brazil and India, but we have not yet obtained approval in any other jurisdiction. Similarly, V-Go has received 510(k) clearance from the FDA, but has not received a comparable approval in any other country. Similarly, Furoscix is approved only in the United States. In order to market our products in a foreign jurisdiction, we must obtain regulatory approval in each such foreign jurisdiction, and we may never be able to obtain such approvals. The research, testing, manufacturing, labeling, sale, import, export, marketing, and distribution of therapeutic products outside the United States are subject to extensive regulation by foreign regulatory authorities, whose regulations differ from country to country. We will be required to comply with the different regulations and policies of the jurisdictions where we seek approval for our products, and we have not yet identified all of the requirements that we will need to satisfy to submit our products for approval for other jurisdictions. This will require additional time, expertise and expense, including the potential need to conduct additional studies or development work for other jurisdictions beyond the work that we have conducted to support the approval of our products in the United States.

Our products andproducts, product candidates and technology may not be able to compete effectively or may be rendered obsolete by rapid technological change.obsolete.

The rapid rate of scientific discoveries and technological changes could result in our approved productsproducts, technologies or one or more of our product candidates becoming obsolete or noncompetitive. OurThird competitorsparties may develop or introduce new products that render our technology or products less competitive, uneconomical or obsolete. For example, on its February 25, 2026 earnings call, United Therapeutics described Tresmi, a treprostinil solution for use in a soft mist inhaler, as a “category killer” in reference to dry-powder inhalers. If any of our Technosphere powders used in Afrezza, Tyvaso DPI, MNKD-201 and MNKD-701, which are based on our proprietary excipient FDKP, are viewed to be inferior to alternative drug delivery technologies, our product portfolio and pipeline could be materially and adversely affected. Our future success may depend not only on our ability to develop our product candidates, but also our ability to improve them in order to keep pace with emerging industry developments. We cannot assure you that we will be able to do so.

The proprietary formulation and inhaler technologies used in Afrezza have also been deployed in our efforts to develop products to treat orphan lung diseases. Our first product to comeaddress out of ouran orphan lung disease pipeline,disease, Tyvaso DPI (treprostinil) inhalation powder, received FDA approval in May 2022 for the treatment of PAH and PH-ILD. Our development and marketing partner, United Therapeutics, began commercializing Tyvaso DPI in June 2022 and is obligated to pay us a royalty on net sales of the product. We also receive arevenue marginfor onthe suppliessupply of Tyvaso DPI that we manufacture for UT. In August 2025, we announced the expansion of our collaboration, pursuant to which we will formulate MNKD-1501, a second investigational molecule using our proprietary technologies, and United Therapeutics will conduct preclinical and clinical development activities. Per the agreement, we received an upfront payment and are eligible to receive milestone payments upon achievement of specified development milestones as well as royalties on net sales of MNKD-1501, if approved.

The other major program in our pipeline that will potentially address an orphan lung disease is MNKD-201, a dry-powder formulation of nintedanib,nintedanib for the treatment of IPF. An oral dosage form of nintedanib washas approvedbeen available for IPFmore bythan thea FDA in 2014.decade. However, a fairly large oral dose is required in order to achieve sufficient drug levels in lung tissue. High systemic levels of nintedanib are often associated with undesirable side effects. Our goal with an inhaled formulation is to deliver a therapeutic amount of nintedanib to the lungs while avoiding high levels of the drug in other tissues, where it is associated with undesirable side effects.tissues. In 2024, we conducted a Phase 1 clinical study of MNKD-201, which met its primary objective of demonstrating positive safety results and good tolerability in healthy volunteers. We planare tocurrently meetconducting witha thePhase FDA1b study of MNKD-201 in the firstUnited halfStates, top line data expected in early 2H 2026, as well as a global Phase 2 study to assess the potential safety and efficacy of 2025this investigational product in patients with IPF, in which we expect the first patient to discussbe theenrolled late-stagein developmentin ofQ2 MNKD-201.2026.

Our business is subject to significant risks, including but not limited to our ability to manufacture sufficient quantities of our products and Tyvaso DPI. Other significant risks also include the risk that our products may only achieve a limited degree of commercial success and the risks inherent in drug development, clinical trials and the regulatory approval process for our product candidates, which in some cases depends upon the efforts of our partners. Ongoing changes in tariff policy by the U.S. government may potentially raise the future cost to source the raw materials and components needed to manufacture our products. We are actively monitoring this situation and exploring strategies to mitigate the risks.

As of December 31, 2024,2025, we had cash, cash equivalents and investments of $202.7$176.4 million, an accumulated deficit of $3.2 billion and a total stockholders’ deficit of $78.8$51.0 million. We had net income of $27.6$5.9 million in the year ended December 31, 2024,2025, net income of $27.6 million and net loss of $11.9 million and $87.4 million in the years ended December 31, 20232024 and 2022,2023, respectively. To date, we have funded our operations primarily through the sale of our equity and convertible debt securities, from the receipt of upfront and milestone payments from collaborations, from borrowings, from sales of AfrezzaAfrezza, Furoscix and V-Go, from royalties and manufacturing revenue from UT, from proceeds of the sale-leaseback of our manufacturing facility in Danbury, CT and from the sale of a portion of future royalties that we receive from UT.

We consider our critical accounting policies to be those related to revenue recognition and gross-to-net adjustments, inventory costing and recoverability, recognized loss on purchase commitments, impairment of long-lived assets, milestone rights liability, clinical trial expenses, stock-based compensation, interest expense related to liability for sale of future royaltiesroyalties, business combinations including valuation of acquired intangible assets and accountingcontingent forconsideration incomeand taxes.stock-based compensation. These critical accounting policies areas alsowell consideredas our significant accounting policies and are more fully described in Note 2 – Summary of Significant Accounting Policies of the Notes to Consolidated Financial Statements included in Part II, Item 8 – Financial Statements and Supplementary Data.

Revenue Recognition – Net Revenue – Commercial Product Sales — We sell products to a limited number of wholesale distributors and specialty and retail pharmacies, and durable medical suppliers (“DME”), specialty distributors and direct purchasers in the U.S. and India (collectively, “Customers”). Wholesale distributors subsequently resell our products to retail pharmacies and certain medical centers or hospitals. Specialty pharmacies sell directly to patients. In addition to distribution agreements with Customers, we enter into arrangements with payers that provide for government mandated and/or privately negotiated rebates, chargebacks, and discounts with respect to the purchase of our products.

We recognize revenue on product sales when the Customer obtains control of our product, which occurs at delivery for wholesale distributors and generally at delivery for specialty pharmacies. We recognize revenue on product sales to a retail pharmacy as the product is dispensed to patients. Product revenues are recorded net of applicable reserves including discounts, allowances, rebates, returns and other incentives. See Reserves for Variable Consideration below.

Significant judgment is required in estimating gross-to-net adjustments, historical experience, payer channel mix unbilled claims, claim submission time lags and inventory levels in the distribution channel. Our reserves for variable consideration related to our commercial products are reflected in our gross-to-net adjustments which were 32% of gross product revenue, or $54.0 million, for the year ended December 31, 2025, compared to 40% of gross product revenue, or $53.8 million, for the year ended December 31, 2024, compared to 43% of gross product revenue, or $56.4 million, for the year ended December 31, 2023. If there is a 10% difference between the estimates for accruals and the actual liability in the reserves for variable consideration, the impact to our revenue for commercial product sales would be $1.7 million or a 1.2% change in the gross-to-net adjustment percentage for the year ended December 31, 2024.

Revenue Recognition – Collaborations and Services — We enter into licensing, research or other agreements under which we license certain rights to our product candidates to third parties, conduct research or provide other services to third parties. The terms of these arrangements may include but are not limited to payment to us of one or more of the following: up-front license fees; development, regulatory, and commercial milestone payments; payments for commercial manufacturing and clinical supply services we provide; and royalties on net sales of licensed products and sublicenses of the rights. As part of the accounting for these arrangements, we must develop assumptions that require significant judgment such as determining the performance obligation in the contract and determining the stand-alone selling price for each performance obligation identified in the contract.

If an arrangement has multiple performance obligations, the allocation of the transaction price is determined from observable market inputs, if available, and we use key assumptions to determine the stand-alone selling price, which may include development timelines, reimbursement rates for personnel costs, discount rates, and probabilities of technical and regulatory success. Revenue is recognized based on the measurement of progress as the performance obligation is satisfied and consideration received that does not meet the requirements to satisfy the revenue recognition criteria is recorded as deferred revenue.

Revenue Recognition – Royalties — We recognize royalty revenue for a sales-based or usage-based royalty if it is promised in exchange for an intellectual property license. The royalty revenue is recognized as the latter of the subsequent sale of the product occurs or, if later and applicable, the satisfaction or ifpartial satisfaction of the performance obligation to which the royalty has been allocated has been satisfied or partially satisfied.allocated. Our collaboration agreement with UT entitles us to receive a royalty on net sales of Tyvaso DPI for the license of our intellectual property that was considered to be interdependent with the development activities that supported the approval of Tyvaso DPI.

Our collaboration agreement with UT entitles us to receive a 10% royalty on net sales of Tyvaso DPI, subject to our sale of a 1% royalty on future net sales to a royalty purchaser (leaving us with a 9% royalty). Our royalty revenue reflects the trend in Decembernet 2023.sales of Tyvaso DPI in the marketplace. See Note 16 – Commitments and Contingencies ofin the Notes to Consolidated Financial Statements included in Part II, Item 8 – Financial Statements and Supplementary Data. Our royalty revenue reflects the upward trend in demand for Tyvaso DPI in the marketplace.

Afrezza — Gross revenue from sales of Afrezza increased by $11.0$10.6 million, or 13%,11%, for the year ended December 31, 20242025 compared to the prior year.year, The increase wasprimarily driven primarilyby byincreased price and higher demand and price.demand. The gross-to-net adjustment was 35%32% of gross revenue, or $34.9 million, for the year ended December 31, 20242025 compared to 38%35% of gross revenue, or $33.0$34.9 million, for the prior year. The improveddecreased gross-to-net percentage was primarily attributable to a decrease in anticipatedrebates productin returnsaccordance (aswith acontractual percentage of gross sales).arrangements. As a result, net revenue from sales of Afrezza increased by $9.1$10.5 million, or 17%,16%, for the year ended December 31, 20242025 compared to the prior year.

V-Go — Gross revenue from sales of V-Go decreased by $5.3$11.0 million, or 13%,30%, for the year ended December 31, 20242025 compared to the prior year and was primarily a result of lower demand partially offset by increasedlower price.gross to net deductions. The gross-to-net adjustment was 51%38% of gross revenue, or $18.9$9.8 million, for the year ended December 31, 20242025 compared to 55%51% of gross revenue, or $23.4$18.9 million, for the prior year. The improved gross-to-net percentage was mainlyprimarily attributable to a decrease in rebates.rebates related to a reduction in active contracts. As a result, net revenue from sales of V-Go decreased by $0.8$1.9 million, or 4%,10%, for the year ended December 31, 20242025 compared to the prior year.

Collaborations and Services and Royalties — Net revenue from collaborations and services increased by $47.9$5.9 million, or 90%,6%, for the year ended December 31, 20242025 compared to the prior year. The increase in revenue was primarily attributable to increased manufacturing volume for product sold to UT. Royalty revenue from UT increased by $30.4$25.8 million, or 42%,25%, for the year ended December 31, 20242025 compared to the prior year due to UT's increase in net revenue from sales of Tyvaso DPI due to higher patient demand.DPI.

See Note 11 – Collaborations, Licensing and Other Arrangements into the consolidatedNotes financialto statementsConsolidated Financial Statements included in Part II, Item 8 – Financial Statements and Supplementary Data.

Commercial product gross profit increased by $11.7$18.5 million, or 22%,28%, for the year ended December 31, 20242025 compared to the prior year. The increase in gross profit and gross margin was primarily attributable to the recognition of sales of Furoscix beginning in the fourth quarter of 2025, as well as an increase in Afrezza net revenue,revenue due to increased sales and improved gross-to-net adjustmentsadjustments. relatedOf the 6% decrease in gross margin, 4% is attributable to V-Gothe rebates and decreased costamortization of goodsthe soldacquired asintangible a result of reduced sales of V-Go and efficiencies gained from increased production volumes of all products manufactured at our Danbury facility.assets.

Cost of revenue — collaborations and services increased by $17.3$2.0 million, or 41%,3%, for the year ended December 31, 20242025 compared to the prior yearyear. The increases were primarily asattributable ato resultan increase in production related inventory write-offs for the period in addition to increase in costs of sales associated with an increase in the number of blisters sold, which was partially offset by decreases in cost per blister due to increased efficiencies in manufacturing volumeactivities ofin Tyvasoour DPI.Danbury, CT facility.

GainLoss on foreign currency transaction was $3.9$7.7 million for the year ended December 31, 20242025 compared to a lossgain of $1.9$3.9 million for the prior year. These non-cash changes were due to fluctuations in U.S. dollar to Euro exchange rates. Under the Insulin Supply Agreement with Amphastar, payment obligations for future purchases are denominated in Euros. We are required to record thea gain or loss on foreign currency transaction impact of the U.S.US dollar to Euro exchange rate associated with thethese recognized loss onfuture purchase commitments. The year-over-year change was due to fluctuations in the Euro to U.S. dollar exchange rates.

Interest income, net, consisting of interest and accretion on investments net of amortization, increaseddecreased by $6.5$4.6 million compared to the prior year primarily due to anlower increaseaverage in the underlying investments from the proceeds of the sale of 1% of our Tyvaso DPI royalties in December 2023 and higher yieldsbalances on our securities portfolio.portfolio as well as lower yields.

Interest expense on liability for sale of future royalties was $16.2$14.4 million and $0.2$16.2 million for the years ended December 31, 20242025 and 2023,2024, respectively, and was attributable to imputed interest and amortization of debt issuance costs on the liability recorded in connection with the sale of 1% of our Tyvaso DPI royalties in December 2023. See Note 16 – Commitments and Contingencies.Contingencies in the Notes to Consolidated Financial Statements included in Part II, Item 8 – Financial Statements and Supplementary Data.

Interest expense on financing liability was $9.8 million for each of the years ended December 31, 20242025 and 2023,2024, and represented imputed interest incurred on the sale lease-back transaction for our manufacturing facility in Danbury, CT.

Gain on bargain purchase of $5.3 million for the year ended December 31, 2024 was the result of the excess of net assets acquired overcompared to consideration paid in the Pulmatrix Transaction. See Note 3 – PulmatrixBusiness Transaction.Combinations in the Notes to Consolidated Financial Statements included in Part II, Item 8 – Financial Statements and Supplementary Data.

Loss on settlement of debt for the year ended December 31, 2024 includes repayment of a portion of the senior convertible notes pursuant to private exchange agreements with certain note holders in December 2024, resulting in an inducement expense of $13.4 million. Additionally, in April 2024, a loss on early extinguishment of debt of $7.0 million was incurred for the year ended December 31, 2024 in connection with the repayment of the MidCap credit facility and Mann Group convertible note.note in April 2024. See Note 10 – Borrowings.Borrowings in the Notes to Consolidated Financial Statements included in Part II, Item 8 – Financial Statements and Supplementary Data.

To supplement our consolidated financial statements presented under GAAP, we are presenting non-GAAP net income (loss) and non-GAAP net income (loss) per share - basic, which are non-GAAP financial measures. We are providing these non-GAAP financial measures to disclose additional information to facilitate the comparison of past and present operations, and they are among the indicators management uses as a basis for evaluating our financial performance. We believe that these non-GAAP financial measures, when considered together with our GAAP financial results, provide management and investors with an additional understanding of our business operating results, including underlying trends.

Represents the non-cash portion of the 1% royalty on net sales of Tyvaso DPI earned during the yearyears ended December 31, 20242025 and fourth quarter of 20232024 which is remitted to the royalty purchaser and recognized as royalties from collaborations in our consolidated statements of operations. Our revenues from royalties from collaborations during the yearyears ended December 31, 2025 and 2024 and fourth quarter of 2023 totaled $128.1 million, $102.3 million and $21.0 million, respectively, of which $12.8 million, $10.2 millionmillion, and $2.1 million, respectively, is remitted to the royalty purchaser.

Our principal sources of liquidity are our cash, cash equivalents, and investments. Our primary uses of cash include the development of our product pipeline, the manufacturing and marketing of AfrezzaAfrezza, Furoscix and V-Go, manufacturing Tyvaso DPI, the funding of selling, general and administrative expenses, and principal and interest payments on our financing liability and debt.

We fund our operations primarily through sales of Afrezza, Furoscix and V-Go, and royalties and manufacturing revenue from UT. Historically, we have funded our operations primarily through the sale of equity and convertible debt securities, from the receipt of upfront and milestone payments from collaborations, from borrowings, from proceeds from the sale of certain assets and the sale of a portion of our future royalties that we receive from UT. More recently, sales of Afrezza and V-Go, and royalties and manufacturing revenue from UT, have become a more significant source of funding for our operations. In combination with our cash, cash equivalents and investments on hand, we believe that these sources of revenue, as well as the potential financing sources currently available to us, will allow us to meet our liquidity needs over the next 12 months and in the longer term.

We believe we will be able to meet our liquidity needs over the next 12 months, as well as longer-term needs, based on the balance of cash, cash equivalents and investments on hand, projected sales of Afrezza and V-Go, and projected royalties and manufacturing revenue from the production and sale of Tyvaso DPI. The following table presents our material cash requirements as of December 31, 20242025 associated with contractual commitments for future periods (in thousands, except footnotes):

$106.4$103.4 million principal amount of indebtedness under the Sale-Leaseback Transaction, plus $113.7$104.2 million of imputed interest.interest and $2.3 million in unamortized debt issuance costs. On November 8, 2021, we sold a portion of our manufacturing facility located in Danbury, CT to an affiliate of Creative Manufacturing Properties (the “Purchaser”) for a sales price of $102.3 million. We leased the property from the Purchaser for an initial term of 20 years, with four renewal options of five years each. The total annual rent under the lease started at approximately $9.5 million per year, subject to a 50% rent abatement during the first year of the lease, and increases annually by (i) 2.5% in the second through fifth year of the lease and (ii) 3% in the sixth and each subsequent year of the lease, including any renewal term. We are responsible for payment of operating expenses, property taxes and insurance for the leased property. Pursuant to the terms of the lease, we have four options to repurchase the property, in 2026, 2031, 2036 and 2041, for the greater of (i) $102.3 million or (ii) the fair market value of the leased property. Interest expense is calculated using an incremental borrowing rate of approximately 9.0% $36.3 million aggregate principal amount of senior convertible notes bearing interest at 2.50% payable semi-annually in arrears on March 1 and September 1 of each year, beginning on September 1, 2021 and maturing on March 1, 2026, unless earlier converted, redeemed or repurchased by us. The senior convertible notes are convertible at an initial conversion price of approximately $5.21 per share of common stock. The conversion rate is subject to adjustment under certain circumstances in accordance with the terms of the Indenture.9.0%.

One such potential pipeline product is ralinepag,ralinepag DPI, a novel, highly selective prostacyclin receptor agonist for which United Therapeutics intends to submit an NDA in the second half of 2026. Although we are also collaborating with United Therapeutics on the development of a dry powder formulation of ralinepag DPI (MNKD-1501), a significant portion of our current revenue is derived from royalties and collaboration and services revenue associated with United Therapeutics’ commercialization of Tyvaso DPI. Because United Therapeutics is solely responsible for the development, marketing, promotion, and sale of Tyvaso DPI, our ability to maintain and grow this revenue is highly dependent on the commercial performance of Tyvaso DPI and on United Therapeutics’ strategic priorities, resource allocation decisions, and overall commitment to undertake development activities that could potentially expand the therapeutic indications for Tyvaso DPI. Moreover, we have limited control over United Therapeutics’ commercialization activities, including decisions related to marketing strategy, salesforce deployment, pricing, market access, physician outreach, patient support programs, and the prioritization of Tyvaso DPI relative to other products in its portfolio.

the occurrence of the milestone(s) that triggertriggers onethe or moreremaining CVR paymentspayment;

As of MarchJune 31,30, 2026, we had an accumulated deficit of $3.2 billion. The accumulated deficit has resulted principally from costs incurred in our R&D programs, the write-off of assets (including goodwill, inventory and property, plant and equipment) and general operating expenses. We expect to make substantial expenditures and may incur operating losses in the future in order to continue commercializing our products and to advance development of product candidates in our pipeline.

We are subject to stringent, ongoing government regulation.*

As part of the approval of Afrezza, the FDA required us to conduct certain additional clinical studies of Afrezza, including a long-term safety study that was originally intended to compare the incidence of pulmonary malignancy observed with Afrezza to that observed in a standard of care control group. We have an ongoing dialogue withAlthough the FDA regardinginformed theus agency’sthat currentwe interestwere released from this postmarketing requirement in theMay long-term2026, safetywe may be required to conduct additional clinical studies of Afrezzaour andfuture anproduct appropriatecandidates, studywhich design or registry to address any concerns. To date, we have not commenced a long-term safety study or budgeted any amount for it, but such a study in its original design would be anticipated tocould require substantial capital resources that we may not be able to obtain.

Afrezza is an ultra rapid-acting inhaled insulin indicated to improve glycemic control in adultspatients with diabetes.diabetes aged six and older. Afrezza was developed by us and consists of a dry powder formulation of human insulin delivered from a small portable inhaler. Administered at the beginning of a meal, Afrezza dissolves rapidly upon inhalation to the lung and delivers insulin quickly to the bloodstream. The expansion of the label to include children and adolescents aged 6 and older living with diabetes was approved by the U.S. Food and Drug Administration (FDA) on May 29, 2026.

Furoscix is a novel formulation of furosemide that delivers an 80 mg dose via an on-body infusor over a five-hour period. Furoscix is approved by the U.S. Food and Drug Administration (or FDA) for the treatment of edema in pediatric patients who weigh at least 43 kg and adult patients with chronic heart failure or chronic kidney disease. Furoscix is the first FDA-approved subcutaneous loop diuretic that delivers intravenous-equivalent diuresis at home as opposed to a hospital setting. Furoscix ReadyFlow, a high concentration formulation of furosemide that is delivered via an autoinjector, was developedapproved by scPharma,the whichFDA weon acquiredJuly 23, 2026 for the treatment of edema (fluid overload) in Octoberadults 2025.with Seeheart Notefailure 2or –chronic Businesskidney Combinations in the Consolidated Financial Statements included in Part II, Item 8 – Financial Statements and Supplementary Data.disease.

The proprietary formulation and inhaler technologies used in Afrezza have also been deployed in our efforts to develop products to treat orphan lung diseases. Our first product to address an orphan lung disease, Tyvaso DPI (treprostinil) inhalation powder, received FDA approval in May 2022 for the treatment of pulmonary arterial hypertension (or PAH) and pulmonary hypertension associated with interstitial lung disease (or PH-ILD). Our development and marketing partner, United Therapeutics, began commercializing Tyvaso DPI in June 2022 and is obligated to pay us a royalty on net sales of the product. We also receive revenue for the supply of Tyvaso DPI that we manufacture for UT. In August 2025, we announced the expansion of our collaboration, pursuant to which we willare formulateformulating ralinepag DPI (MNKD-1501) as a dry powder using our proprietary technologies. United Therapeutics will conduct preclinical and clinical development activities of MNKD-1501. Per the agreement, we received an upfront payment and subsequent development payment and are eligible to receive milestone payments upon achievement of specified development milestones as well as royalties on net sales of MNKD-1501, if approved.

The other major program in our pipeline that will potentially address an orphan lung disease is MNKD-201, a dry-powder formulation of nintedanib for the treatment of idiopathic pulmonary fibrosis (or IPF). An oral dosage form of nintedanib has been available for more than a decade. However, a fairly large oral dose is required in order to achieve sufficient drug levels in lung tissue. High systemic levels of nintedanib are often associated with undesirable side effects. Our goal with an inhaled formulation is to deliver a therapeutic amount of nintedanib to the lungs while avoiding high levels of the drug in other tissues. In 2024, we conducted a Phase 1 clinical study of MNKD-201, which met its primary objective of demonstrating positive safety results and good tolerability in healthy volunteers. We arerecently currentlyreported conductingtop-line data from a Phase 1b study of MNKD-201 conducted in the United States, with topadditional lineresults datato expectedbe inpresented theat thirda quarterfuture ofscientific 2026,conference. asWe wellare ascurrently conducting a global Phase 2 study to assess the potential safety and efficacy of this investigational product in patients with IPF, in which we expect the first patient to be enrolled in the second quarter of 2026.IPF.

Our critical accounting policies and estimates can be found in Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report.Report on Form 10-K for the year ended December 31, 2025. See Note 1 – Description of Business and Significant Accounting Policies in the condensed consolidated financial statements included in Part I – Financial Statements (Unaudited) for descriptions of the new accounting policies and impact of adoption.

Our future success is dependent on our, and our current and future collaboration partners’,partners’ ability to effectively commercialize approved products. Our future success is also dependent on our pipeline of new products and expansion opportunities for existing products, such as new formulations or expanded indications. There is a high rate of failure inherent in the R&D process for new drugs. As a result, there is a high risk that the funds we invest in research programs will not generate sufficient financial returns. Products may appear promising in development but fail to reach market within the expected or optimal timeframe, or at all.

Three and six months ended MarchJune 31,30, 2026 and 2025

The following table provides a comparison of the revenue categories for the three and six months ended MarchJune 31,30, 2026 and 2025 (dollars in thousands):

V-GoAfrezza — Gross revenue from sales of V-GoAfrezza decreased by $1.5$1.7 million, or 23%,6%, for the three months ended MarchJune 31,30, 2026 compared to the same period in the prior yearyear. andThe decrease was driven primarily a result ofby lower demand. The gross-to-net adjustment was 36%33% of gross revenue, or $1.8$8.4 million, for the three months ended MarchJune 31,30, 2026 compared to 36%32% of gross revenue, or $2.3$8.8 million, for the same period in the prior year. As a result, net revenue from sales of V-GoAfrezza decreased by $0.9$1.3 million, or 23%,7%, for the three months ended MarchJune 31,30, 2026 compared to the same period in the prior year.

Collaborations and Services and Royalties — Net revenue from collaborations and services decreasedincreased by $5.9$12.2 million, or 20%,53%, for the three months ended MarchJune 31,30, 2026 compared to the same period in the prior year. The decreaseincrease in revenue in the current quarter was primarily attributable to decreasedincreased product sold to UT due to timing of manufacturing activities and recognition of the related deferred revenue.revenue as well as revenue earned related to the development of ralinepag DPI. Royalty revenue from UT increased by $2.7$1.1 million, or 9%,4%, for the three months ended MarchJune 31,30, 2026 due to UT's increase in net revenue from sales of Tyvaso DPI.

The following table provides a comparison of the commercial product gross profit categories for the three and six months ended MarchJune 31,30, 2026 and 2025 (dollars in thousands):

Commercial product gross profit increased by $11.2$9.7 million, or 74%,54%, for the three months ended MarchJune 31,30, 2026 compared to the same period in the prior year. Commercial product gross profit increased by $20.9 million, or 63%, for the six months ended June 30, 2026 compared to the same period in the prior year. The increase in both periods was primarily attributable to the increase in total product revenues after adding Furoscix to our product portfolio following the acquisition of scPharma in October 2025. Gross margin as a percentage of revenue decreased by 13% for the three months ended June 30, 2026 compared to the same period in the prior year and 9% for the six months ended June 30, 2026 compared to the same period in the prior year. The decrease in both periods was primarily attributable to the inclusion of Furoscix in our product portfolio which has a lower gross margin percentage than Afrezza.

The following table provides a comparison of the expense categories for the three and six months ended MarchJune 31,30, 2026 and 2025 (dollars in thousands):

Cost of revenue – collaborations and services decreased by $3.8$0.8 million, or 28%,5%, for the three months ended MarchJune 31,30, 2026 compared to the same period in the prior year. Cost of revenue – collaborations and services decreased by $4.6 million, or 16% for the six months ended June 30, 2026 compared to the same period in the prior year. The decrease in both periods was primarilydue to a resultdecrease ofin decreasedcost productper soldblister due to UT.increased efficiencies in manufacturing activities in our Danbury, CT facility.

Research and development expenses increased by $6.2$4.3 million, or 56%,32%, for the three months ended MarchJune 31,30, 2026 compared to the same period in the prior year. Research and development expenses increased by $10.5 million, or 43%, for the six months ended June 30, 2026 compared to the same period in the prior year. The increaseincreases wasin both periods were primarily attributable to the development of the Furoscix ReadyFlow Formulation as well as higher personnel costs following the acquisition of scPharma and higherincreased development costs fromfor MNKD-201, which has begun enrolling subjects. These increases were partially offset by lower clinical development expenses resulting from the discontinuation of MNKD-201the asICoN-1 studiesclinical advanced.study for MNKD-101 and the completion of the Afrezza pediatric study (INHALE-1).

Selling, general and administrative expenses increased by $29.1$26.7 million, or 116%,84%, for the three months ended MarchJune 31,30, 2026 compared to the same period in the prior year. Selling, general and administrative expenses increased by $55.8 million, or 98%, for the six months ended June 30, 2026 compared to the same period in the prior year. The increaseincreases wasin both periods were primarily related to costs associated with the promotion and support of Furoscix, as well as higher Afrezza-related expenses including expanding theour field basedfield-based teams and preparingactivities to support the launches associated with the recent approvals of the pediatric indication for a potential pediatric launch of Afrezza inand 2026.the Furoscix ReadyFlow Autoinjector.

Amortization of acquired intangible assets was $4.4 million for the three months ended MarchJune 31,30, 2026 and $8.7 million for the six months ended June 30, 2026 and was related to the amortization of the developed technology related to the Furoscix on-body infuserinfusor acquired from scPharma.

Gain on foreign currency transaction was $1.3$0.5 million for the three months ended MarchJune 31,30, 2026 compared to a loss of $2.5$5.4 million for the same period in the prior yearyear. Gain on foreign currency transaction was $1.8 million for the six months ended June 30, 2026 compared to a loss of $7.9 million for the same period in the prior year. These non-cash changes were due to fluctuations in EuroU.S. dollar to U.S. dollarEuro exchange rates. Under theour Insulin Supply Agreement with Amphastar, payment obligations for future purchases are denominated in Euros. We are required to record the foreign currency transaction impact of the U.S. dollar to Euro exchange rate associated with the recognized gain or loss onfuture purchase commitments.

The following table provides a comparison of the other income (expense) categories for the three and six months ended MarchJune 31,30, 2026 and 2025 (dollars in thousands):

Interest income, net, consisting of interest and accretion on investments net of amortization, decreased by $0.5$0.8 million for the three months ended MarchJune 31,30, 2026 compared to the same period in the prior year and decreased by $1.3 million for the six months ended June 30, 2026 compared to the same period in the prior year. This was primarily due to a lower average balance on our securities portfolio and lower yields.

Interest expense increased by $2.8$11.6 million for the three months ended MarchJune 31,30, 2026 compared to the same period in the prior year and increased by $14.4 million for the six months ended June 30, 2026 compared to the same period in the prior year. The increase was primarily due to new term loans with an aggregate principal amount of $325.0 million, which were drawn in August and October 2025.2025 as well as the achievement of an Afrezza net sales milestone in the second quarter of 2026, which resulted in the recognition of $4.5 million of interest expense. See Note 15 – Commitments and Contingencies - Milestone Rights for additional information on the Afrezza net sales milestone.

Interest expense on liability for sale of future royalties decreased by $1.0$3.0 million and $4.0 million for the three and six months ended MarchJune 31,30, 20262026, respectively, compared to the same periodperiods in the prior year. Interest consists of imputed interest and the amortization of debt issuance costs on the liability recorded in connection with the sale of 1% of our Tyvaso DPI royalties in December 2023. Imputed interest is based on third-party estimates of future royalties to be generated from Tyvaso DPI. See Note 15 – Commitments and Contingencies.

Interest expense on financing liability was $2.4 million for both the three months ended MarchJune 31,30, 2026 and 2025, and $4.8 million for both the six months ended June 30, 2026 and 2025. Interest expense on financing liability represents interest incurred on the sale lease-back transaction for our manufacturing facility in Danbury, Connecticut.

Loss on settlement of debt of $0.9 million for the threesix months ended MarchJune 31,30, 2026 was incurred in connection with the settlement of the senior convertible notes in March 2026.

Other expense of $2.8$5.0 million for the three months ended MarchJune 31,30, 2026 and $7.8 million for the six months ended June 30, 2026 was the result of the remeasurement of the fair value of the contingent consideration liability obtained from the acquisition of scPharma. The contingent consideration will be remeasured each subsequent reporting period until the related contingencies have been resolved.

The following table reconciles our financial measures for net (loss) income and net (loss) income per share ("EPS") for basic weighted average shares as reported in our condensed consolidated statements of operations to a non-GAAP presentation as adjusted by certain non-cash items identified below.

Represents the non-cash portion of the 1% royalty on net sales of Tyvaso DPI earned during the three and six months ended MarchJune 31,30, 2026 and 2025, which is remitted to the royalty purchaser and recognized as royalties from collaborations in our condensed consolidated statements of operations. Our royalties from collaborations during the three and six months ended MarchJune 31,30, 2026 and 2025 totaled $32.7$32.4 million and $30.0$65.1 million, respectively, of which $3.3$3.2 million and $3.0$6.5 million, respectively were remitted to the royalty purchaser.

As of MarchJune 31,30, 2026, we had $64.6$64.1 million in insulin purchase commitments and $325.0 million aggregate principal amount under the Blackstone Credit Facility. The Blackstone Credit Facility will mature on August 6, 2030. As of MarchJune 31,30, 2026, the effective interest rate is 9.09%9.12% per annum. The SOFR Loans borrowed under the Blackstone Credit Facility are subject to the Adjusted Term SOFR plus margin of 5.00%. We have the option to prepay the loans under the Blackstone Credit Facility in whole or in part, subject to early prepayment fees on or prior to the third anniversary of the Closing Date. See Note 9 – Borrowings for further information related to the Blackstone Credit Facility.

In July 2013, we granted Milestone Rights to the original purchasers under the Milestone Rights Agreement. The original purchasers later assigned those rights to new holders. As of MarchJune 31,30, 2026, $45.0 million remains payable upon the occurrence of specified strategic and sales milestones under the Milestone Rights Agreement. During the three and six months ended June 30, 2026, the Company achieved an Afrezza net sales milestone which will result in a $5.0 million payment to the Original Milestone Purchasers in the third quarter of 2026. See Note 15 – Commitments and Contingencies for further information related to the Milestone Rights.

In October 2025, we entered into the CVR Agreement with the rights agent party thereto, which governs the terms of the CVRs issued to the former stockholders of scPharma in the acquisition transaction. TheMilestone 1 under the CVR Agreement was achieved on July 23, 2026, which will necessitate an aggregate payout of approximately $44.8 million in the third quarter of 2026. Following the payout for the achievement of Milestone 1, the maximum aggregate amount payable with respect to the CVRs issued at the closing of the acquisition is $59.7$14.9 million, subject to the achievement of certain regulatory and net sales milestones on or prior to the applicable milestone outside datesdate in accordance with the CVR Agreement. See Note 2 – Business Combinations – Contingent Value Right ("CVR") for further information related to the CVR Agreement.

Pursuant to the CF Sales Agreement with Cantor Fitzgerald, we may offer and sell, from time to time, through Cantor Fitzgerald, shares of our common stock. Under the CF Sales Agreement, Cantor Fitzgerald may sell shares by any method deemed to be an “at-the-market offering” as defined in Rule 415 under the Securities Act of 1933, as amended. On February 26, 2025, we filed a sales agreement prospectus under a registration statement on Form S-3, which became effective upon filing, covering the sale of up to $200.0 million of our common stock through Cantor Fitzgerald under the CF Sales Agreement, of which $200.0 million remained available as of MarchJune 31,30, 2026.

During the threesix months ended MarchJune 31,30, 2026, we used a net $5.4$23.7 million of cash for our operating activities. Cash used in operating activities consisted of net loss of $16.6$35.7 million offset by non-cash adjustments of $16.2$36.7 million and a net decrease in cash flow from operating assets and liabilities of $5.0$24.8 million. Non-cash items primarily included stock-based compensation of $6.5$16.7 million, depreciation and amortization of $6.4$12.8 million and change in fair value of contingent consideration of $2.8$7.8 million. These charges were partially offset by the sold portion of royalty revenue of $3.3 million and gain on foreign currency transactions of $1.3$6.5 million. The net decrease in cash flows from operating assets and liabilities was primarily due to an increase of $14.9$11.6 million in inventory, decreaseincrease of $5.8$4.8 million in accruedaccounts expenses and other current liabilitiesreceivable and decrease of $4.9$7.4 million in deferred revenue. The net decrease in cash flows from operating assets and liabilities was partially offset by aan decreaseincrease of $10.3$2.0 million in accounts receivable.payable.

During the threesix months ended MarchJune 31,30, 2025, we usedgenerated a net $6.4$2.6 million of cash forfrom our operating activities. Cash used in operating activities consisted of net income of $13.2$13.8 million offset by non-cash adjustments of $10.8$30.6 million and a net decrease in cash flows from operating assets and liabilities of $30.3$41.8 million. Non-cash items primarily included stock-based compensation of $5.4$12.9 million, depreciationloss andon amortizationforeign currency transactions of $2.1$7.9 million,million and interest on liability for sale of future royalties of $3.6$7.1 million. These charges were partially offset by the sold portion of royalty revenue of $3.0$6.1 million. The net decrease in cash flows from operating assets and liabilities was primarily due to an increase of $17.1$15.3 million in accounts receivable, decrease of $4.5$9.3 million in deferred revenue and increase of $3.0 million in prepaidaccrued expenses and other current assets.liabilities and decrease of $7.1 million in deferred revenue.

Cash provided by investing activities of $18.7$36.6 million for the threesix months ended MarchJune 31,30, 2026 was primarily due to $30.9$53.9 million of proceeds from maturities of available-for-sale securities. Cash provided was partially offset by the purchase of $10.3 million of available-for-sale securities as well as $1.9$7.0 million of property and equipment.

Cash provided by investing activities of $6.0$12.2 million for the threesix months ended MarchJune 31,30, 2025 was primarily due to the maturity of $50.4$101.8 million of debt securities, partially offset by the purchase of $44.1$88.1 million of debt securities.

Cash used in financing activities of $35.4$34.8 million for the threesix months ended MarchJune 31,30, 2026 was primarily due to payments made to settle our remaining senior convertible notes.

Cash used in financing activities of $1.4$4.1 million for the threesix months ended MarchJune 31,30, 2025 was primarily due to $1.6$4.4 million of payments to taxing authorities from equity withheld upon vesting of RSUs and stock options.options partially offset by $1.3 million in proceeds from our market price stock purchase plan and employee stock purchase plan.

We believe that we will be able to meet our near-term liquidity needs based on our cash, cash equivalents and investments on hand, sales of Afrezza, Furoscix and V-Go, royalties and manufacturing revenue from the production and sale of Tyvaso DPI and, if necessary, borrowings under the Blackstone Credit Facility, as well as through debt or equity financing, for our long-term liquidity needs. We expect to continue to incur expenditures for the foreseeable future in support of our manufacturing operations, sales and marketing costs for our products and development costs for other product candidates in our pipeline. As of MarchJune 31,30, 2026, we had capital resources comprised of cash, cash equivalents and investments totaling $133.9 million, and total principal amount of outstanding borrowings of $325.0$111.1 million.

To date, we have been able to timely make required interest payments under our outstanding indebtedness, including the total principal amount of outstanding borrowings of $325.0 million, but we cannot guarantee that we will be able to do so in the future. If we fail to repay our outstanding indebtedness when required, we will be in default under the applicable instrument for such indebtedness and may also suffer an event of default under the terms of other borrowing arrangements that we may enter into from time to time. Any of these events could have a material adverse effect on our business, results of operations and financial condition, up to and including the noteholders initiating bankruptcy proceedings or causing us to cease operations altogether.