On August 8, 2019 Inovio Pharmaceuticals, Inc. (NASDAQ: INO), an innovative biotechnology company focused on the discovery, development and commercialization of synthetic DNA technology targeted against cancers and infectious diseases, reported financial results for the second quarter ended June 30, 2019 (Press release, Inovio, AUG 8, 2019, View Source [SID1234538470]). Inovio’s management will host a live conference call and webcast at 4:30 p.m. Eastern Time today to discuss financial results and provide a general business update.
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Inovio Highlights
VGX-3100/HPV-Related Diseases
Inovio completed enrollment of 198 participants for its primary Phase 3 registration trial (REVEAL 1) of VGX-3100 for the treatment of high-grade cervical dysplasia (cervical HSIL) caused by human papillomavirus (HPV). Inovio is currently enrolling its confirmatory Phase 3 trial (REVEAL 2).
VGX-3100 was granted an Advanced Therapy Medicinal Product Certificate for quality and non-clinical data by the European Medicines Agency (EMA), which confirms that Inovio’s chemistry, manufacturing and controls (CMC) data and nonclinical results available to date overall comply with the scientific and technical standards for evaluating an EU Marketing Authorization.
Inovio and QIAGEN announced a collaboration to co-develop a liquid biopsy-based companion diagnostic to identify patients who could benefit from VGX-3100.
Inovio completed enrollment for its Phase 2 trial of VGX-3100 for the treatment of high-grade vulvar dysplasia (vulvar HSIL) in July. Inovio intends to report interim clinical data from this study, along with interim results from the Phase 2 study for high-grade anal dysplasia (anal HSIL), before the year end.
In July, Inovio executed a strategic refinement to focus on the commercial development of its late-stage HPV assets, which includes VGX-3100, and reallocate capital to develop fast-to-market product candidates, such as INO-3107 (previously called INO-3106) to treat RRP (recurrent respiratory papillomatosis). RRP is a rare, orphan disease caused by HPV 6 and 11 infections, for which clinical benefit was recently demonstrated in a pilot study. Inovio plans to initiate the next clinical trial of INO-3107 within the next 12 months.
Cancer Combination Trials
Inovio received a third Phase 2 milestone payment from AstraZeneca for MEDI0457 in combination with durvalumab for dosing patients in the third HPV-related cancer indication; two previous milestone payments resulted from initiating Phase 2 combination trials targeting head and neck and cervical cancers. AstraZeneca continues to expand and evaluate MEDI0457 in three different Phase 2 trials that target HPV caused cancers. Subsequent to the quarter, AstraZeneca completed planned enrollment of its Phase 2 study in head and neck cancer (ClinicalTrials.gov Identifier: NCT03162224).
Inovio completed enrollment of its Phase 1/2 immuno-oncology trial in 52 patients with newly diagnosed glioblastoma three months ahead of schedule. Interim results evaluating safety, immunological impact, progression-free survival and overall survival from this study are expected by the end of 2019.
As part of the strategic organizational restructuring announcement in July, Inovio discontinued its Phase 1/2 clinical trial of INO-5401 in patients with advanced bladder cancer. The decision to discontinue the trial was made because of the recognition that several new therapeutic alternatives have been approved, or are likely to be approved, for study patients since the trial’s design and inception, and because of the high expense of the trial.
INO-5151, Inovio’s prostate cancer immunotherapy, will be combined with an immune modulator (CDX-301, FLT3 ligand, a dendritic cell mobilizer) and a PD-1 checkpoint inhibitor (nivolumab) targeting metastatic castration-resistant prostate cancer in a Parker Institute for Cancer Immunotherapy (PICI) sponsored platform study. As part of Inovio’s clinical collaboration agreement with PICI and in collaboration with the Cancer Research Institute, INO-5151 is one arm (Cohort C) of this broad PICI-supported study which is a multi-arm, multi-stage platform design (PORTER Study: ClinicalTrials.gov Identifier: NCT03835533).
DNA-encoded Bi-specific T Cell Engagers (dBTEs)
Preclinical data results for Inovio’s transformative dBTE technology were published in JCI Insight. The current bi-specific T cell engager product has only a few hours of half-life and requires several weeks of continuous intravenous infusion. Inovio developed a novel dBTE targeting the HER2 molecule which was tested successfully in therapeutic models for the treatment of ovarian and breast cancers. A single injection of the HER2 dBTE candidate produced bi-specific antibodies that lasted for several weeks and effectively killed HER2-expressing tumor cells resulting in a near-complete tumor clearance. Inovio plans to rapidly advance its dBTE technology.
Infectious Diseases
Inovio dosed its first patients in its Phase 1 clinical study evaluating safety, tolerability and immune responses to INO-4500 in patients with Lassa fever. INO-4500 is the world’s first Lassa fever virus vaccine candidate. The INO-4500 program is fully funded through a global partnership with the Coalition for Epidemic Preparedness Innovations (CEPI).
In July, positive clinical trial results from the world’s first clinical testing of a vaccine against the Middle East Respiratory Syndrome Coronavirus (MERS) were published in The Lancet Infectious Diseases. Inovio’s MERS DNA vaccine INO-4700 was well-tolerated and 94% of patients demonstrated overall high levels of antibody responses, while 88% of study participants demonstrated broad-based T cell responses. A Phase 2 field trial is being planned in the Middle East through the partnership with CEPI.
Cash Position
As of June 30, 2019, cash and cash equivalents and short-term investments were $106.0 million compared to $81.2 million as of December 31, 2018.
In August, Inovio closed a private placement of 1.0% convertible bonds due 2024 with an aggregate principal amount of 18 billion Korean Won (KRW) (approximately USD $15.0 million based on the exchange rate on the date of issuance) issued to a group of institutional investors led by Korea Investment Partners (KIP), a global venture capital and private equity firm. These bonds are convertible into Inovio’s Korean Depositary Receipts (KDRs) assuming Inovio has completed a secondary listing of its securities on the KOSDAQ Market of the Korea Exchange in the form of KDRs, or otherwise shares of common stock if KDRs are not listed at the time of conversion.
Dr. J. Joseph Kim, Inovio’s President & CEO said, "Inovio is well-positioned to advance its later-stage HPV programs while devoting more resources to develop fast-to-market product candidates. Through its recent strategic organizational restructuring the company has sharpened its focus to create a more efficient organization with greater financial flexibility and a longer runway. We continue to make excellent progress on expanding our treatment capabilities within the areas of HPV related diseases and we’re excited that before year-end we plan to have interim data from our Phase 2 studies involving VGX-3100 targeting vulvar HSIL and anal HSIL, and plan to initiate the next clinical trial of INO-3107 targeting RRP within 12 months."
Second Quarter 2019 Financial Results
Total revenue was $136,000 for the three months ended June 30, 2019, compared to $24.4 million for the same period in 2018. Total operating expenses were $28.3 million for the three months ended June 30, 2019, compared to $29.7 million for the same period in 2018.
Inovio’s net loss for the quarter ended June 30, 2019 was $29.4 million, or $0.30 per basic and diluted share, compared to $6.6 million, or $0.07 per basic and $0.08 per diluted share, for the quarter ended June 30, 2018.
Revenue
The year over year decrease in revenue under collaborative research and development arrangements was primarily due to the recognition of the gross up-front payment from ApolloBio of $23.0 million during the second quarter of 2018 (approximately $19.4 million was received after payment of required taxes).
Operating Expenses
Research and development (R&D) expenses were $22.5 million for the three months ended June 30, 2019 and June 30, 2018.
Contributions received from current grant agreements and recorded as contra-research and development expense were $2.6 million for the three months ended June 30, 2019 compared to $1.9 million for the same period in 2018.
General and administrative (G&A) expenses were $5.9 million for the three months ended June 30, 2019 versus $7.2 million for the same period in 2018. The decrease in G&A expenses was primarily related to the foreign non-income taxes and advisory fees incurred in connection with the ApolloBio upfront payment Inovio received in 2018.
Capital Resources
As of June 30, 2019, cash and cash equivalents and short-term investments were $106.0 million compared to $81.2 million as of December 31, 2018. As of June 30, 2019, Inovio had 98.6 million common shares outstanding and 125.5 million common shares outstanding on a fully diluted basis, after giving effect to the exercise, vesting and conversion, as applicable, of its outstanding options, restricted stock units, convertible preferred stock and convertible notes.
Inovio’s condensed consolidated balance sheet and statement of operations are provided below. Additional information is included in Inovio’s quarterly report on Form 10-Q for the quarter ended June 30, 2019, which can be accessed at: View Source
Conference Call / Webcast Information
Inovio’s management will host a live conference call and webcast at 4:30 p.m. Eastern Time today to discuss Inovio’s financial results and provide a general business update.
The live webcast and a replay may be accessed by visiting Inovio’s website at View Source Telephone replay will be available approximately one hour after the call at 877-344-7529 (US toll free) or 412-317-0088 (international toll) using replay access code 10133668.