MNKD 2018 Proxy Statement

Compensation Philosophy and Objectives The Compensation Committee oversees our executive compensation within the context of a compensation philosophy. This philosophy is to provide compensation and benefits programs designed to attract, engage, motivate, and retain a high caliber workforce that enables us to compete with companies in the pharmaceutical and biotechnology industries and to reward individual and corporate performance. We believe that a well-designed compensation program for our executive officers should: • align the goals of the executive officer with the goals of our stockholders; • recognize individual initiative and achievement; • provide total compensation that enables us to compete with companies in the pharmaceutical and biotechnology industries; and • align compensation with our short-term and long-term corporate objectives and strategy, focusing executive officer behavior on the fulfillment of those objectives. In keeping with this philosophy, our executive compensation program is designed to achieve the following objectives: • attract talented and experienced executives; • motivate and reward executives whose knowledge, skills and performance are critical to our success; • retain executives and employees who are instrumental in accomplishing our corporate goals; • align the interests of our executives and stockholders by motivating executives to increase stockholder value and rewarding executives when stockholder value increases; • provide a competitive compensation package which is weighted towards pay-for-performance, and in which total compensation is primarily determined by the Company’s and the individual’s achievement of results; • ensure fairness among the executive management team by recognizing the contributions each executive makes to our success; • foster a shared commitment among executives by aligning the Company’s and their individual goals; and • compensate our executives to manage our business to meet our long-term objectives. Competitive Market Assessment The Compensation Committee periodically reviews competitive market data to determine if our compensation levels remain at targeted levels and our pay practices are appropriate. These assessments include a review of base salary, annual incentives, and long-term incentives. These components are evaluated against a group of peer companies. MannKind also considers industry specific and general published survey compensation data where peer group data is not robust. Specifically, we utilized the Radford Global Life Sciences Executive Survey, the SIRS Executive Compensation Survey and the Kenexa CompAnalyst Executive Survey. For the past eight years, the Compensation Committee has engaged Mercer to benchmark the compensation levels of senior executive positions relative to a group of peer companies. Peer Group As part of our annual peer group review process, we have developed a peer group for benchmarking purposes, by considering companies in the same industry with similar company characteristics, such as revenue 48