On May 9, 2019 Inovio Pharmaceuticals, Inc. (NASDAQ: INO), an innovative biotechnology company focused on the discovery, development and commercialization of its synthetic nucleic technology targeted against cancers and infectious diseases, reported financial results for the first quarter ended March 31, 2019 (Press release, Inovio, MAY 9, 2019, View Source [SID1234536135]). 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/INO-3106; HPV-related Pre-cancers
Inovio’s Phase 3 trials for VGX-3100, REVEAL 1 and REVEAL 2, are both up and running and are executing on track. REVEAL 2 began recruitment in March while REVEAL 1 is anticipated to be fully enrolled with 198 patients by mid-2019. Additionally, Inovio expects interim data from its two Phase 2 trials with VGX-3100 in patients with vulvar and anal dysplasia later this year.
Inovio recently announced that VGX-3100 has been granted an Advanced Therapy Medicinal Product certificate by the European Medicines Agency’s (EMA) Committee for Advanced Therapies following an extensive evaluation of its chemistry, manufacturing and controls (CMC) data and nonclinical results. Since the inception of the program in 2009, only 11 ATMP Certifications have been awarded by the EMA. This certificate is an important developmental milestone for VGX-3100 as it will facilitate the preparation, filing, and review of a future European market application for VGX-3100.
In April, VGX-3100 was selected at the World Vaccine Congress as the 2019 "Best Therapeutic Vaccine."
Extending its portfolio into additional HPV-related diseases, Inovio announced its novel therapy, INO-3106, against the human papilloma virus type 6 (HPV 6) demonstrated clinical efficacy in a pilot clinical study of two patients with recurrent respiratory papillomatosis (RRP), a rare orphan disease. Results presented at the American Association for Cancer Research (AACR) (Free AACR Whitepaper) demonstrated that following both patient’s last dose of INO-3106, the patients have been surgery-free, due to lack of tumor recurrence. One patient has not needed surgery for over two years; the other has been surgery-free for over one year. A complete study report is being prepared for publication in a medical journal, and Inovio plans to further develop INO-3106 as a novel, non-invasive immunotherapy for the treatment of RRP, for both adult and pediatric populations.
MEDI0457 (VGX-3100 + IL-12; licensed to AstraZeneca)
Inovio achieved a third cancer indication milestone under its collaboration with AstraZeneca, triggered by AstraZeneca dosing a patient in a Phase 2 combination trial evaluating MEDI0457 (formerly called INO-3112) in combination with durvalumab, an anti-PD-L1 immune checkpoint inhibitor, targeting cervical, anal, penile, and vulvar cancers associated with human papilloma virus (HPV). AstraZeneca continues to evaluate MEDI0457 in combination with durvalumab in multiple Phase 2 trials in patients with HPV-related cancers.
In January, Inovio announced that two patients with HPV-related head and neck cancer, who were treated with MEDI0457 in a Phase 1 trial, achieved a sustained complete response (full remission) following subsequent treatment with a PD-1 checkpoint inhibitor.
INO-5401 – Cancer Combination Trials
Inovio completed enrollment of its Phase 1/2 immuno-oncology trial in patients with newly diagnosed glioblastoma (GBM). The enrollment of 52 patients was achieved three months ahead of schedule. The trial is designed to evaluate Inovio’s INO-5401 T cell activating immunotherapy encoding multiple antigens expressed by GBM and INO-9012, an immune activator encoding IL-12, in combination with cemiplimab-rwlc (also known as Libtayo or REGN2810), a PD-1 inhibitor developed by Regeneron Pharmaceuticals in collaboration with Sanofi. Interim results evaluating safety, immunological impact, progression-free survival and overall survival from this study are expected before the end of this year.
DNA-Encoded Bi-specific T Cell Engagers (dBTEs)
Inovio presented pre-clinical results at a major cancer conference (AACR) (Free AACR Whitepaper) on the company’s novel DNA-encoded Bi-specific T Cell Engagers (dBTE) technology. Inovio, with its collaborators at The Wistar Institute, developed a novel dBTE targeting the HER2 molecule which was tested in therapeutic models for the treatment of ovarian and breast cancers. Importantly, just a single dose of Inovio’s HER2 dBTE resulted in high levels of corresponding BiTE in mice for four months, far exceeding what is typically displayed with conventional BiTE’s short half-life of only a few hours. The HER2 dBTE effectively killed HER2-expressing tumor cells resulting in a near-complete tumor clearance. Also presented was Inovio’s CD19 dBTE which can kill B cell cancers by targeting B cell specific marker CD19.
These results were subsequently published in a JCI Insight journal article entitled, "DNA-encoded bi-specific T cell engagers and antibodies present long-term antitumor activity."
DNA-Encoded Monoclonal Antibody (dMAb)
In February, the company dosed a subject in the first-ever human study of Inovio’s DNA-encoded monoclonal antibody (dMAb) technology evaluating the ability of our technology to express Zika virus-specific mAbs. This study is being fully funded by The Bill and Melinda Gates Foundation. While the trial’s focus is on evaluating the dMAb for Zika infection, the clinical results are intended to help advance Inovio’s dMAb and dBTE programs in infectious diseases and cancer.
Infectious Diseases
Phase 1 data for INO-4201, the company’s Ebola vaccine, was published in The Journal of Infectious Diseases, further supporting the advancement of the intradermal delivery platform for vaccines. Significantly, the study demonstrated that intradermal (skin) administration with Inovio’s CELLECTRA efficacy enhancing device resulted in 100% of evaluable subjects generating antigen-specific antibody responses that persisted for more than one year in most subjects and generated robust T cell responses. The published data further validates the safety, potency, and product stability advantages of Inovio’s immunotherapy platform.
Geneos Therapeutics, Inc.
In February, Inovio’s personalized cancer vaccine subsidiary Geneos, secured a Series A financing round with potential proceeds of up to $10.5 million. With this funding, Geneos is fully operational as a standalone entity in its efforts to develop the next generation of neoantigen-targeting cancer immunotherapies. Geneos has an exclusive license to Inovio’s immunotherapy platform in the area of personalized cancer immunotherapy; Inovio holds majority equity position in Geneos and continue to develop and commercialize all global population-based (non-personalized) cancer immunotherapies based on its proprietary SynCon design. Geneos is now focused on initiating its first clinical study in 2019.
Management and Board Updates
During the first quarter, Inovio announced the appointment of Jacqueline E. Shea, PhD, as Inovio’s Chief Operating Officer (COO) and Executive Vice President. Dr. Shea will be responsible for Inovio’s manufacturing, commercial, business development, and alliance management operations as well as serving as a key member of the executive team along with the CFO and CSO in formulating and implementing overall corporate strategy.
Also in the first quarter, the Company announced that Mr. Simon X. Benito, former Merck Vaccines executive, was appointed Chairman of Inovio’s Board of Directors. In addition, the Company appointed Ms. Lota Zoth, former CFO of MedImmune, and Dr. Ann C. Miller, former commercial executive with Merck, Amgen, Eisai and Sanofi, to its Board of Directors.
Cash Position
As of March 31, 2019, cash and cash equivalents and short-term investments were $128.0 million compared to $81.2 million as of December 31, 2018. In the first quarter 2019, the Company completed a private placement of $78.5 million aggregate principal amount of 6.50% convertible senior notes due 2024, or the Notes. The Notes were sold in a private offering to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended. Net proceeds from the offering were approximately $75.7 million, after deducting the initial purchasers’ discount and offering expenses payable by the Company.
Dr. J. Joseph Kim, Inovio’s President & CEO said, "The last several months have been extremely productive for Inovio by validating the company’s versatile technology platform. We ended the first quarter by featuring positive data from our Phase 1 Ebola study in a prestigious publication. Inovio further highlighted its capabilities in treating HPV-associated disease after presenting positive data from patients diagnosed with RRP, where we demonstrated a clinical benefit for these patients. Additionally, we initiated the first ever clinical study for our dMAb platform during the first quarter and unveiled an exciting new component within our platform involving our novel dBTE technology, which we’re working towards rapidly advancing the first product into clinical testing. Inovio enters the second quarter well-financed following the February raise, placing us in a prime position to continue to deliver on our game-changing clinical programs."
First Quarter 2019 Financial Results
Total revenue was $2.8 million for the three months ended March 31, 2019, compared to $1.5 million for the same period in 2018. Total operating expenses were $31.4 million compared to $34.3 million for the same period in 2018.
Inovio’s net loss for the quarter ended March 31, 2019 was $29.2 million, or $0.30 per basic and diluted share, compared to $32.4 million, or $0.36 per basic and diluted share, for the quarter ended March 31, 2018.
Revenue
The year over year increase in revenue under collaborative research and development arrangements was primarily due to the milestone payment recognized in the first quarter 2019 from AstraZeneca.
Operating Expenses
Research and development (R&D) expenses for the three months ended March 31, 2019 were $24.4 million compared to $24.6 million for the same period in 2018. The decrease in R&D expenses was primarily related to a sub-license expense of $1.9 million recorded in 2018 related to the ApolloBio collaboration, partially offset by an increase of $1.2 million related to Inovio’s VGX-3100 Phase 3 clinical trials, among other variances.
General and administrative (G&A) expenses were $7.0 million for the three months ended March 31, 2019 versus $9.7 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 March 31, 2019, cash and cash equivalents and short-term investments were $128.0 million compared to $81.2 million as of December 31, 2018. As of March 31, 2019, the Company had 97.9 million common shares outstanding and 125.3 million common shares outstanding on a fully diluted basis, after giving effect to outstanding options, restricted stock units, convertible preferred stock and convertible notes.
In the first quarter 2019, the Company completed a private placement of $78.5 million aggregate principal amount of 6.50% convertible senior notes due 2024. Net proceeds from the offering were approximately $75.7 million.
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 March 31, 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 the Company’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 10131163.