Good day, everyone. And welcome to the MannKind Corporation Third Quarter 2020 Earnings Call. As a reminder, this call is being recorded on November 4, 2020, and will be available for playback on the MannKind Corporation website shortly after the conclusion of this call until November 18, 2020. This call will contain forward-looking statements.

Such forward-looking statements are subject to risks and uncertainty, which could cause actual results to differ materially from these stated expectations.

For further information on the Company’s risk factors, please see their 10-Q report filed with the Securities and Exchange Commission this afternoon, the earnings release and the slides prepared for this presentation. Joining us today from MannKind are Chief Executive Officer, Michael Castagna; and Chief Financial Officer, Steven Binder.

I would now like to turn the conference over to Mr. Castagna. Please go ahead, sir..

Thanks. And thank you and thank you everyone for dialing in on what appears to be a hectic election -- post-election day here. So, as we get into the agenda, we’re going to go through our Q3 highlights, the financial review of Steve and Q4 expectations and then a Q&A.

I just want to remind people about our mission, which is really to give people control of their health and the freedom to live life, and we call it, life more humann.

Our technology really helps provide quick relief of patients’ symptoms, such as high sugar, pulmonary hypertension, and migraine, almost at the onset of action and being able to correct that with the quick inhalation using our platform. We’re very excited to continue to expand our technology into other assets as we continue to move R&D forward.

I’d also like to announce recent new addition to our team, Dr. Kevin Kaiserman, who now will be our Head of Medical Affairs and Safety. And new week, we expect to also announce a new head of regulatory. Kevin has 25 years of pediatric endocrinology experience, which we felt was very valuable, given our direction to move further into pediatrics in 2021.

He is well-respected as a thought leader. He had private practice here in California and was trained at Children’s Hospital of LA. He’ll be leading our medical affairs, expanded field medical team, our safety and our pediatrics program. Let me talk about a few of the Q3 highlights.

Afrezza third quarter net revenue of $7.3 million with 27% ahead of Q3 of 2019. In the U.S., our total prescription grew 8% and sequentially 3% in quarter two. The market was down 3% over -- year-over-year for rapid-acting analogs, and 2% quarter-over-quarter respectively.

So, we’re outpacing the market shrinkage and we’re continuing to grow year-over-year, despite the headwinds that COVID-19 presents. Access is continuing to open up for our field reps reaching customers in the field.

Obviously, certain areas of the country are more difficult than others, but our team has done a very decent job given the difficult circumstances they face. Our U.S. September year-to-date net revenue is $22.1 million or 31% versus 2019 and our trend is starting to pick up nicely in Q4, as we hope to see scripts [ph] up this Friday.

Our United Therapeutics collaboration with TreT remains on track to complete the critical NDA components here in Q4. And we recently received a $1.2 million purchase order for clinical supplies as we get to Q4 in 2021 and beyond. Our cash at the end of the quarter was $52.7 million and we used $13.5 million in operating activities.

We also reduced our debt by $2.6 million in October by prepaying our December promissory note and at schedule. When we look at our Afrezza, the green line here is NRx and our magenta line here is TRx. As you can see, we’re stable throughout Q3, slightly growing.

We believe there might have been some small data issues here at the end of September, but net-net, you can see our Afrezza line is starting to trend back in the right direction at 344 as of last week and 799. We expect to continue to see that trend as we go through Q4.

However, I will highlight some differences we’ll see over the next few weeks and months as we end our free bridge program at the end of the call. Our clinical programs are tracking to a fourth quarter completion. And I tried to outline here for you the four key pivotal things we need to complete by the end of this year.

Number one is the BREEZE trial, which is almost completed enrollment, maybe that’s the wrap up here in Q4, that being led by United [ph]. The second is a pivotal PK trial, which is now complete and the study report is currently being written up.

In the human factors study, MannKind is wrapping up as we speak and we expect that will be done by next week with the study report too here in Q4. And our stability programs, which MannKind is also responsible for, wrap up in the next three to four weeks.

So, as you can see the four critical things that lead to a TreT filing in early 2021 will be completed here in the fourth quarter. We’re also excited to increase the potential that TreT has for the interstitial lung disease indication as UT expects approval for Tyvaso in April 2021.

And we’ll be hearing back in terms of does this get filed in our label proactively or do we have to do additional work, we’ll know that very shortly. I’d like to turn it over to Steve to talk about our financials..

Thanks, Mike, and good afternoon. Very pleased to review our third quarter and September year-to-date 2020 financial results, which show continued U.S. Afrezza net revenue growth, Afrezza gross margin expansion rising above the 50% mark for the first time, and our continued focus on efficiently managing our cash resources.

I’ll be discussing select financial highlights and ask that you supplement this call by reading the condensed consolidated financial statements and MD&A contained in our 10-Quarter, which is filed with the SEC this afternoon. Let’s start out with looking at revenues for the third quarter and September year-to-date.

Starting with the table on the left, which is our third quarter results. U.S. Afrezza net revenue was $7.3 million versus $5.7 million in 2019, a growth rate of 27%.

The increase was driven by volume growth from underlying Afrezza prescription demand, which was up to 8% year-over-year, price including a more favorable gross to net percentage, and the continuation of a favorable mix of higher insulin unit cartridges.

Please note that a reduction of point $0.3 million in wholesale inventory has occurred between June 30th and September 30, 2020, adversely impacting our volume growth. The COVID-19 pandemic continues to impact our sales and marketing efforts in the third quarter.

Physician access, including both face to face and digital interaction was constrained in varying degrees between different geographies, which impacted the effectiveness of our sales and marketing efforts.

We continue to seen an impact on new Afrezza starts as some patients were reluctant to visit their physician to minimize the exposure to COVID, as well as physicians increasing the use of telehealth.

Please note that we did not have an international Afrezza revenue in the third quarter of 2020, but did have revenues of $0.7 million in third quarter of 2019, which was our first sale of Afrezza to Biomm, our Brazilian commercial partner. Looking at the September year-to-date comparisons further in the table to the right, we U.S.

Afrezza net revenue grew 31% versus 2019, driven by volume, mix and price. Gross to net 41% for the third quarter, which was slightly favorable to our expected range of 42% to 44%, and favorable to 2019 by 2%, and demonstrates the impact of our efforts to lower gross to net.

In September, year-to-date gross to net came in at the lower end of the expected range at 42%. Revenue from collaboration and services was $8.1 million for the third quarter of 2020 versus $8.2 million to 2019. While September year-to-date revenue was $24.4 million versus $29.5 million for 2019.

The reduction in the September year-to-date revenue year-over-year was expected and was mainly due to the recognition of the $10 million United Therapeutics research agreement over the period of the fourth quarter 2018 to the second quarter 2019 when our performance obligations were substantially completed.

This slide shows an example of one of our commercial initiatives to lower our gross to net. Using full line wholesalers is very expensive for small biopharmaceutical companies like MannKind. So, we’ve been shifting prescription for fulfillment from retail to specialty pharmacies.

Specialty pharmacies purchase Afrezza directly from MannKind and not through a wholesaler. They have lower fees, and generally they have minimal product returns, which improves our gross to net. As you can see from the graph, we have increased specialty pharmacy shipments each quarter in 2020.

We came into the year with 6% of shipments going through specialty pharmacies, increasing to 8% in the first quarter, 15% in the second quarter, 17% in the third quarter, and in October, we saw 20% of shipments go to specialty pharmacies. We have shown in the next slide an almost every quarterly earnings call over the last two years.

It’s that important factor on our present net revenue growth story. This graph shows how our product mix continues with favorable impact on Afrezza revenue growth in the September year-to-date period.

Our successful messaging to physicians, enhanced patient understanding of our product have resulted in more appropriate starting doses for patients as well as subsequent titration to higher doses, which has driven the 12-unit and 8-unit cartridge growth faster than the 12-unit.

As a reminder, our 12-unit cartridge is priced 3 times the 4-unit cartridge and the 8-unit cartridge is priced at 2 times of 4-unit cartridge. Faster growth of the higher unit cartridges results in a higher growth rate of Afrezza revenue compared to prescription growth. As Afrezza revenues have been increasing, so gross margins.

This table shows gross margins in the first quarter of 2019 to the third quarter of 2020 where our gross margin topped 50% for the first time.

We have had and continue to have excess manufacturing capacity, which results in our cost of goods remaining relatively flat quarter-to-quarter due to production volumes remaining significantly lower than our production capacity. This results in a majority of manufacturing expenses being recognized as cost of goods in the quarter incurred.

As TreT clinical product production is ramped up in 2020, we are now able to drive costs over two products being manufactured at our Danbury facility, resulting in a favorable impact on the further cost of goods sold as we can see from the reduction in the first two third quarters of 2020.

Please note that the first quarter of 2020 included an inventory write-off of $0.5 million to on a non-GAAP basis first quarter of 2020 cost of goods without the inventory write-off would have been $3.7 million. Moving on to operating cash efficiency. On the next slide we are comparing September year-to-date 2020 versus 2019 versus 2018.

The top of each vertical bar is Afrezza net revenue, which has doubled in two years to $22.3 million. And the bottom is non-GAAP net cash used in operating activities, which has decreased by 45% in two years.

The increase in the present net revenue helps drive down the cash burn, but to a larger extent, we’ve been laser focused on managing or operating spend, and it shows in the reduction of $40.9 million for the nine months ended September 30, 2020.

Looking at this information slightly differently, at the bottom of slide we show our average quarterly non-GAAP net cash used in operating activities. We have been running fairly steady in 2020 on a quarter by quarter basis, where the average quarterly amount of $13.6 million or the actual third quarter 2020 amount was $13.5 million.

Before handing the presentation back to Mike, let me summarize the third quarter financial progress. First, we had excellent U.S. Afrezza net revenue growth, even when continuing to experience headwinds from the COVID-19 pandemic.

Second, manufacturing TreT to support United Therapeutics clinical trials has allowed our manufacturing sites to absorb fixed overhead costs, which is favorable impact to the Afrezza gross margin.

And lastly, we remain extremely diligent managing our cash while supporting commercial efforts to grow Afrezza, supply TreT clinical products to United Therapeutics and move our pipeline forward. Thank you. And now, we’ll turn it back over to Mike for some additional comments..

Thank you, Steve. Now let’s talk about growing our future together and where we’re heading as we close out here in Q4 and start to move in 2021. First, we completed our commercial and our medical team expansion by hiring 26 new employees in Q3 and early Q4 alone, with several committed employees we expect to start over the next few weeks.

We are expanding our integrated care model to improve the patient experience for Afrezza as well as the margins on the product.

AfrezzaAssist you heard us talk about recently, which was streamlined the reimbursement support program, which was launched here in Q3 and is being fine tuned in Q4, with a really automated process when it comes to prior authorizations and adjudication of free goods.

Additionally, we’re putting final touches on our telehealth collaboration with UpScript, [ph] which is weeks from launching. We’ve had the opportunity to also talk to another telehealth provider, called Steady Health who is already doing Afrezza prescription via telehealth here in California and Washington DC.

And we’re very excited about what they’re seeing in the early results.

Third, we are transitioning our Bridge program, which is also known as our Free Goods and shows up in our weekly prescription to AfrezzaAssist which will ultimately push these prescriptions into a channel that you no longer see in company and will now show up directly to us, but it will not be counted in terms of weekly prescriptions.

New patients ended yesterday and all patients we expect in the Free Goods program to end by 12/31/2020.

There will be some impact to NRx and TRx over next 12 weeks but we don’t expect any negative impact on revenue, because we believe it would be converted from free goods to paid prescription, as we expect people to do [indiscernible] and we see a good 50% to 80% Company’s [indiscernible] get approved in the free goods program.

And then second, these patients will go and stay on drugs, but they’re already free, so that they’re not impacting our revenues, we’ve got these prescriptions before we report revenue to Wall Street. We also plan to enhance our product distribution model to lower our costs and improve patient access, as Steve talked about.

$0.22 of every dollar is right now dedicated to the wholesale channel and returns. We think that can be dramatically improved by looking at ways such as consignment inventory model, which would minimize returns and the fee would be at COGS as opposed to a prescription that goes to the wholesaler.

There are very exceptional [ph] prescriptions that go through the free goods program, and we hope to minimize that cost and the free goods associated with those prescriptions into the coming quarters.

Next, we achieved our sample program and our sample volume will be reduced by half, which we expect will result in better patient initiation as we get a new 27-count titration sample pack launched which should A, streamline prescribing; and B, put less samples into the marketplace.

We really expect the sample pack to get the patients started for the first seven days, and then from there, our new AfrezzaAssist program will ship products directly to the patient while the prior offer’s being completed in that seven-day time period. We also are ready to launch our BluHale Pro, obviously with COVID, it stayed down.

We’ve already started work on 2.0, which will be dose detection and integration hopefully with the [indiscernible] API for continuous CGM monitoring along with overlay of dosing data with Afrezza.

We have 6 new publication studies that we believe will be accepted and published here in Q4, in addition to the 14 new scientific releases we’ve had in 2020. As we talked about on previous calls, one of the biggest factors we need to do with the Afrezza is education market, and all the safety and efficacy aspects of the product.

And just those two weeks, I’ve had many calls on the VA system and DL and Kaiser [ph] and many other key thought leaders around the country. We’re all really trying to do a much better job of getting our information in front of the right people.

We expect our pediatric Phase 3 study protocol to be submitted to the FDA here in Q4 and late stages of picking the name [ph] for the study as well as CRO. And once we get the FDA feedback, we will decide when to start that trial, amidst the COVID issues that exist in clinical trials in case these days.

What to expect in terms of Treprostinil here in Q4? One we expect the fourth milestone to come in at $12.5 million.

We anticipate shipping an additional $800,000 in clinical inventory in Q4 and will anticipate additional purchases in 2021 as explore ILD and continuation of existing patients in the expansion, as well as the preparation for the approval and building launch inventory.

We expect to complete all clinical and CMC work here to support the NDA submission as I stated here in Q4. You may have heard this, Uni-Ther expects to file TreT by April 2021 with an FDA approval in late ‘21 or early ‘22. The Tyvaso label expansion for ILD is expected in April 2021.

Reason that’s important, there are no currently approved treatments for WHO Group 3, which is 30,000 patients. Today, Tyvaso builds their sales on 3,000 patients. This is 10 times larger than where they are today.

And this is really an important opportunity for TreT and have a planned study -- UT has a planned study for BREEZE-2 if it’s needed pending FDA’s feedback on our filing strategy here very shortly. United Therapeutics expects additional readouts for PH-COPD, as well as CFILD, which are all upside on our current TreT assumptions.

On a bridge over to the pipeline on Technosphere, we just completed formulation work on two new opportunities, which we’ll talk about in early Q1. We’re progressing Sumatriptan forward, it’s just completed large animal testing and preliminary results look very positive to keep going forward.

We will give a further update here in early 2021 on the pipeline as we go through a prioritization exercise, a bit more clarity to the marketplace around which compounds are moving where and some of these new assets we’re starting to develop. The next question we always get is around capital expectations.

As Steve showed you, we continue to be very prudent and reducing our cash burn, managing it very tightly and we have not had any major fundraisers in three years. We ended Q3 with $52.7 million. We expect the Q4 milestone of $12.5 million.

MidCap has a third tranche available to us at $25 million between now and the first half of 2021, subject to milestone conditions. We are exploring a sale leaseback at the Danbury facility. We will retain the facility but sell it to an investor and then we lease it back. The early stages -- this is in early stages, but feedback has been very positive.

We continue to look for operating efficiency opportunities to drive both top and bottom line growth by decreasing our gross to net and managing our cash spend tightly and finding ways to accelerate revenue growth as evidenced by our recent hires in the field.

We don’t take time to get up to speed, but that expansion to 11 new states should start to pay off here in Q4 and Q1 and beyond.

So, as we previously showed, our transformation of our revenue growth drivers are now finally starting to deliver shareholder value as we look at our performance this year and all the readouts that we have coming in terms of the Technosphere platform continues to move other assets forward. Our U.S.

Afrezza for adults is growing year-over-year despite the COVID challenges the industry faces. Our pipeline is moving nicely forward here with TreT. We are looking at additional collaborations with other companies.

Afrezza international expansion obviously has been impacted but the trial in India is about to go under way here in November, if all goes well. Our Afrezza pediatric program is moving forward as planned here to file this with FDA at the end of Q4, and Phase 3 trial in the near future.

Overall, we feel very good about where we are and we thank all of our employees, our shareholders, and our patients for enabling us to be successful and grow despite the challenges we’re all facing. I think we’ll open up to Q&A..

[Operator Instructions] We’ll take our first question from Brandon Folkes with Cantor Fitzgerald. .

Maybe can you just talk a little bit about how you think about your sales force now in terms of [Technical Difficulty] And then, any color if you were to add reps [Technical Difficulty] adding new territories, or just adding additional reps in really kind of territories, are you just increasing any core points there? And then following on from that, as we look out into 2021, can you start to just talk about some of the areas you may see behind next year?.

Brandon, I missed the 2021 part..

Just areas of the business, you’re going to look to invest behind in [Technical Difficulty] behind in 2021..

Great. Thank you. Sure. So, let me give some color on the sales force expansion. So, we made a decision in Q2 to expand our sales force. We hired quite a few people in Q2, we trained them in Q3, and they’re out there now running. We’ve also expanded our medical team. So, we have more medical liaison, medical education providers.

Here, we still have one or two of them. We will be starting very shortly. And that’s another big expansion as we think, one of the key parts of Afrezza is, we’re finding physicians just aren’t aware of our data. But they want to learn more. They want to understand how to prescribe it, and are inviting us out. So, I think that’s exciting.

I talked to a physician today, is getting four grand rounds in the next three weeks, and Afrezza is a big part of it. That’s just an example where having more people in the bus allows us to get in front of the docs who are given grand rounds and other talks, to ensure Afrezza is now being highlighted as one of the new ultra acting things out there.

But that’s exciting. The other part is the expansion of the commercial team.

So, we know, we get a lot of feedback, what are we doing online, so you think about 2021, I think we can scale up online presence even more, because we know that sales force as much as we try under COVID, the impact is going to be bumped a little bit as we sit here in lockdowns and opening closing academic centers.

So, one of the areas we’re really focused on is increasing education amongst the educators, as well as senior education, as well as online engagement with patients.

And so, that’s really what you’re seeing the telehealth launch? How do we find people online, who are struggling, make sure they’re clicking on our ads and show to them telehealth? How does it raise awareness amongst patient advocates that are out there, and all the third party websites that we just haven’t had a strong presence in.

But, we now have more, more patients coming to the product every day, we say we got to get this out to patients, we’ve got to share that news. And so, we’re trying to enable those people to do that more effectively. So, I think that’s a little bit what you’ll see in 2021.

On the medical side, we will probably look at some new analysis of our data to get some new research publications and presentations next year. And we’re also looking at maybe running some small studies, to answer a couple of questions, we have that we have not answered yet in some of our pipeline opportunities with Afrezza as well as the pipeline.

In terms of capital allocation, there’s not a lot of expense to move some of the pipeline assets forward. We think that can be offset just managing our cash balance.

I think, as you see TreT launched and our pipeline move forward, they’ll be coinciding each other as the pipeline is in the -- from Phase 1 to Phase 2, those Phase 2 studies should come into play roughly after TreT is launched and generating cash in the Company.

So we’re trying to manage everything to make them think, so can build it out and create shareholder value..

We’ll move next and take Thomas Smith with SVB Leerink..

Just a couple on my end.

First one TreT, can you talk about some of the work you’re doing on the manufacturing side to prepare for the potential approval and commercialization? Sounds like it could come in 2021 or early 2022? And then, you mentioned United planning the BREEZE-2 through trial, obviously, they’re running the clinical development program.

But can you talk about how you think about their strategy to expand the TreT label beyond the initial PAH indication?.

Sure. On the manufacturing side, we completed build out of the factory really late last year. So, that was a multimillion dollar investment and about six-month project that’s completed. So, we’ve made commercial supplies within that batch. We really got one piece of equipment coming and finalized, the NDA package.

So that’s all here and we’re just wrapping all that up here between now and the end of the year. So, the factory should be in a place to start to make scalable commercial supplies here in the roughly January timeframe. So, we’ll be ready to go on that one.

On the BREEZE and UT leading the filing, what I would say is, we’re aligned on their perspective of how they think about the label, how we’re approaching the FDA with getting ILD in the label. And remember, we’re filing TreT as an NDA, not a 505B.

So that gives us a little more flexibility around reference in terms of UT, the owners of ILD data, as well as the PAH indication. And there’s a small chance that we have to do the BREEZE to get the ILD and there is a chance the FDA will allow us to file with the ILD and the label. We’re waiting for FDAs feedback on that.

And marginally, it makes sense, you should be able to move forward. But I think that will be in lockstep with the FDA and UT to make that decision. But we’ll have that pretty much in early Q1, to be able to get more clarity there. But from my perspective, Tyvaso looks good in ILD, TreT looks good relative to Tyvaso.

There shouldn’t be additional -- or much additional work required in order to get the ILD indication. To give you a little more color on that. We’re including different types of PAH subgroups in our human factors study. So, we will have human factors data, which is probably one of the bigger things with FDA for ILD, right.

And that’s additional indications beyond just people on Tyvaso. So, that’s just other ways we’re preparing to make sure we’re ready to go..

We’ll move on next to Robert Hazlett with BTIG..

Thanks. So, I appreciate all the color here. And just to follow up on that line of discussion.

What would the brief to the design look like? Do you have any sense of a plan for that at this point?.

I think -- I don’t have a black and white answer on this. I think, it’d be a small study, like we saw with our BREEZE-1 study. The question is probably more naïve patients than a switch is my guess. But I think that’s going to be dependent on the FDA feedback.

But, I think, real question right now is do we need BREEZE-2, we’re ready to go in the event we need to and we don’t want to lose any time and getting this in TreT label. So, I think that’s the first question is, do we need to do BREEZE-2? And if we do, we’re ready to go. And if we don’t, we plan to file with ILD in label for hopefully 2021 launch. .

Okay, great. Thanks for that. And then, the United Therapeutics agreement contemplates other research programs and efforts that you haven’t disclosed.

Any chance on any visibility of those other efforts in the not too distant future?.

Yes. What I would say is, we’re all focused on making sure TreT hits it timeline and get the patients as soon as possible. We met with the team many times on other ideas and other assets. I won’t talk much about that. I think let’s get to TreT. I think hopefully, this is a -- the plan here is not to be a one and done partnership with UT.

We expect -- our platform exclusively for PAH and we would expect to find more opportunities, the outpatient in PAH with other products. So, I think let’s get TreT off the ground, and I think the rest. we’ll have further discussions and guide..

And we’ll move next to Steven Lichtman with Oppenheimer and Company. .

Mike, I think, you started -- you talked about the [indiscernible] here.

Can you walk through again through the mechanics of that in terms of the P&L and also the benefits that you see in terms of really opening up access?.

Yes. And Steve I apologize. We’re having some issue with phone. So, to our shareholders and analyst on the phone I apologize if I broke up a little bit. We’ll look into this for next time. I think, what I heard you ask is a mechanics of Afrezza and the benefits that I see of the program in terms of the process.

So, the mechanics are if you’ve heard of something like CoverMyMeds, it’s very similar, but streamlined. So, doctor will e-prescribe to a central pharmacy and that pharmacy then automatically given -- if it goes through, with no PA, it just goes through and gets filled.

If there is a PA required, a PA gets immediately emailed to the doctor, and then from there they filled out, it goes electronically into the payer. And most of the time these are approved within a day or two, so we think max 72 hours.

If it’s not approved within 72 hours after submission, we will provide a free code for free drug to get the patient started quickly, while we await the answer. If the answer is negative, we’ll appeal at the doctor -- obviously will appeal it. We do see maybe 20% of patients that go through an appeal.

But 80% of the people generally, either get it right away with no PA or the PA is approved within a couple of days. So, we believe 8 out of 10 patients will go through automatically through this new process and they’ll be streamlined directly to a pharmacy.

The benefit that on the other side of this is the pharmacy is used to seeing a present prescription. If it’s written wrong, they’ll get it correctly with the doctor immediately. They’ll have an inventory within a day. So, there’s no long-term wait for the patient.

And then, we think as we launched the telehealth model, they’re not going to want to go a Walgreens or CVS, right? They’re going to want to go and have it directly mailed to a third party. So, that’s also streamlining that aspect for the patient with the telehealth model, as well as direct streamlined prescribing.

So, we’re trying to make it easy for patients to get Afrezza easy to get the refills along with -- one of the things we’ll get here is the ability and the consent to follow up with patients to make sure that they on the drugs, we train them in person. And if there’s any other challenges we face that we have the ability to reach out to them.

That’s another big part of our model in the future. And leveraging our new hub that we built to help in difficult cases to make sure patients I want -- I mean we see the access to the drug. And it’s interesting, some of the payers are contacting us trying to think about ways to move Afrezza up in the category, maybe to prefer from non-preferred.

That’ll be exciting if that happens. And we recently got notification that CMS is going to remove the injectable restrictions for Afrezza, when you come to get CGM. Right now CGM was in Medicare, was only dedicated if you’re on injectable insulin.

That will be changed in coming months with a period where inhaled insulin will also be added to the criteria or it will just remove the word injectable, the reality how that will flow. So, we’re having good discussions there. And we’re also looking to try to ensure that Medicare patients have access under the new Medicare plan in 2021 or 2022.

So, a lot on the access side and ultimately, that’s really we’re trying to do is to streamline this perception. Because that’s one of the reasons doctors tell us to hold them back.

And we think if we can fix this, make it easier, take the barrier question -- the access barrier question away, then the rest of it’s really about knowing how to prescribe the drug and titrate to drug, and that’s getting easier by the day within the sample pack. So, long winded answer to an important question.

But, we’ve hired some great people here from other competing companies in terms of the diabetes space. And I feel very good about the team we have in place to run this program. So, I’m looking forward to getting off the ground..

We’ll take [indiscernible]..

I meant to ask a question about gross margin. Congratulations on the progress with that, first and foremost, that’s pretty impressive over the past couple of quarters.

Is there more room, more leverage there, especially as you think about additional capabilities coming on board with TreT and other programs?.

Yes. There certainly is. And when I look at our costs and you look at the where we’re trending for Afrezza, call it in the 4 million [ph] a quarter range and 2 million for collaboration services, that gets adjusted a little bit if we actually add some additional resources for commercial manufacturing.

But generally, that’s not going to change in the short-term. So, you take a model and model out where our revenues are going, you can see where our costs are going to be..

Got it. Thanks. .

So, I think we’ll take this away to get those into the 70%, 80% range, which is going forward, there’s no reason to keep dropping to the bottom line. And that’s as far as getting efficiencies and the fact, it’s second to TreT and we’ll continue to move in the direction..

Thank you..

Yes. I don’t see any more questions here. So I want to thank. I know one [indiscernible] doing something else. So, I appreciate the message here. So, we will wrap up the call, available for any questions for analysts to follow up and any shareholders feel free to email us. We’ll try to get back to you and answer any questions you have.

So, we are looking forward to wrapping up here Q4 and 2020 putting this behind us and getting ready for an exciting 2021 as we anticipate using our TreT program forward, Afrezza and the international market opportunities that exist. So, once again thank you everybody. Be safe out there. And I look forward to talking to you hopefully early New Year. .

Everyone, that concludes our conference call for today. Thank you all for your participation and you may now disconnect..