In a surprising development, the FDA delayed review of Mannkind’s insulin inhaler, because an inspection of a manufacturing plant hasn’t been completed. In a statement, Mannkind ceo Alfred Mann says the company believes all other such sites have been inspected, clinical trials are complete and there are no other outstanding FDA questions unanswered.

FDA approval had been expected by Jan. 16 and as recently as a week ago, Mannkind execs indicated the regulatory okay was on its way. Now, though, it’s not clear when approval will be made and a source close to the company tells TheStreet that the “FDA messed up,” because Mannkind execs were supposedly led to believe inspections were completed.

Mann, an elderly Los Angeles billionaire and philanthropist, has reportedly bet nearly half of his estimated $2 billion fortune that he can develop an inhaled version of insulin for the nation’s 5 million diabetics (see here). His tenacity has drawn intense interest, particularly in the wake of Pfizer’s fabulous flop marketing Exubera (background here). Analysts are divided over the prospects for Mannkind’s product, which has been renamed Afrezza.

In an investor note, Hapoalim Securities analyst Jon LeCroy writes that Mannkind has “repeatedly hyped Afrezza’s product profile, opportunities with potential partners, an expected easy passage through the FDA, and potential market opportunity, but as of yet, has not delivered…We view the fact that there is now no definite time-line for approval as a major negative, as drugs that have a missed PDUFA often take months to years to receive a final decision.”

However, Simos Simeonidis at Rodman & Renshaw believes there is a 75 percent likelihood the drug will be approved this year and, in fact, the delay may only last a few weeks. In his own investor note, he writes the delay could help the FDA complete labeling discussions and a REMS program, which “leaves the door open” to an advisory panel meeting. In his view, this would push approval out by a few months, although would likely result in an FDA endorsement, anyway. He cautions that if the FDA issues a complete response letter, it would be “catastrophic,” but ballparks this at 25 percent.