Business in Brief: Mannkind Files Shelf Prospectus to Raise Up to $500 Million

Chiasma shares plunge after FDA rejects drug application | Algo-trader wins court backing to continue | Tel Aviv shares end higher in dull trading

The managers of Mannkind.
Kobi Cantor

Mannkind files shelf prospectus to raise up to $500 million

Mannkind, the U.S. biotech company traded on the Tel Aviv Stock Exchange, yesterday filed a shelf prospectus to raise up to $500 million. That will be an ambitious undertaking for a company whose market capitalization is just over $700 million, but Mannkind is badly in need of capital to relaunch its insulin-inhaling powder Afrezza after the French drug maker Sanofi ended a marketing agreement with it in January. Earlier this month Mannkind said it would begin marketing Afrezzi itself starting in the third quarter. The Sanofi announcement sending Mannkind shares into a tailspin, but they have staged something of a recovery since bottoming out in early January, giving the company an opening to raise more capital. Mannkind said it would raise the capital in stages and through different types of securities. Shares of the company were up 3.9% at $1.70 early afternoon local time in New York. (Uri Tomer) 

Chiasma shares plunge after FDA rejects drug application

Shares of Chiasma, the U.S.-Israeli biotech company, plunged in New York trading yesterday after the U.S. Food and Drug Administration said the new drug application for Mycapssa, a treatment the company is developing for a rare ailment related to the pituitary gland, was not ready for approval in its present form. The FDA said Chiasma would need to conduct another clinical trial, as its NDA failed to provide enough evidence of efficacy to warrant approval.. “We are surprised, disappointed and respectfully disagree with the FDA’s decision,” said Chiasma CEO Mark Leuchtenberger. “The FDA has encouraged us to request an end of review meeting with the agency to discuss the path forward, and we will do so.” Shares of Chiasma were down 62% to $3.84 at midafternoon local time in New York. (Yoram Gabison)

Algo-trader wins court backing to continue

The Israel Securities Authority lost the first round in its legal battle to bar retail investors from algorithmic trading. In a provisional ruling on Sunday, Tel Aviv District Court Judge Ruth Ronen said algo-trader USG Capital could continue offering its services with a license as the ISA had demanded. But the court imposed conditions on USG, most importantly barring it from providing training for clients in algo-trading except for the basics of how to use the firm’s software. The ISA had sought to shut USG on the grounds that it was costing clients millions of shekels in losses and gave them misleading information in what it said was a “systematic” manner. The ISA, which has been cracking down on unlicensed broker dealers, said it was satisfied with the court’s decision. “The company is no longer authorized to continue its operations in the same way it did before the authority intervened,” it said in a statement. (Shelly Appelberg)

Tel Aviv shares end higher in dull trading

Tel Aviv shares traded mostly sideways yesterday before edging higher in the final hour of trading, leaving the benchmark TA-25 index up 0.25% for the day at 1,492.85 points and TA-100 up 0.2% to 1,287.84. Turnover reached 1.1 billion shekels ($290 million), boosted by Osem’s delisting, which caused exchange-traded notes managers to stock up on the other shares comprising the TA-25 to meet their portfolio commitments. Most shares traded in a narrow range, but El Al Airlines gained 2.3% to 3.05 shekels as a slump in oil prices promised to cut costs. Rami Levy rose 3.65% to 153.20 and biotech company Navidea soared 13% to 5.50, extending a 23% gain from the day before in anticipation of an announcement from its Microphage unit. Redhill, another biotech company, closed up 3.2% for 5.06 after it said that U.S. regulators had tentatively given its go-ahead for a Phase III study of the company’s RHB-105 treatment for H. pylori infection. (Omri Zerachovitz)