Results & Analyst Call Summary

Inovio Pharmaceuticals

Conference date: Aigist 7, 2018 @ 1:30 PM Pacific Time
for quarter ending: June 30, 2018 (Q2, second quarter)

Forward-looking statements

Overview: Continues to develop vaccines for cancers and infections, led by VGS-3100 for cervical dysplasia, which is in Phase 3.

Basic data (GAAP):

Revenue was $24.4 million, up sequentially from $1.5 million, and up from $20.4 million in the year-earlier quarter.

Net income was negative $6.6 million, up sequentially from negative $32.4 million, and down from negative $9.5 million year-earlier.

EPS (earnings per share, diluted) was negative $0.07, up sequentially from negative $0.36, and down from negative $0.13 year-earlier.


Has over a year of cash runway.

Quarter Highlights:

Dr. J. Joseph Kim, Inovio’s CEO said, "The second quarter included important strategic accomplishments for Inovio, while also providing shareholders with much to look forward to over the next 12 months. From presenting expanded data from our HIV developmental vaccine, Pennvax-GP, to dosing our first patient with INO-5401 in our Glioblastoma [brain cancer] trial, Inovio continues to showcase the versatility of our technology in both immunotherapy and infectious diseases. We continue to work diligently with our newly established partners ApolloBio, CEPI and the Parker Institute, while maintaining focus on opening sites and enrolling patients globally for our lead asset, VGX-3100, for treating patients with cervical dysplasia as well as capturing the overall commercial value potential of VGX-3100 through the expansion of our immunotherapeutic solution capabilities in HPV-related vulvar and anal precancers."

Revenue was up mainly from recognition of the up-front payment of $23.0 million from ApolloBio.

On March 14 the Phase 1 trial for INO-1800 for Hepatitis B reported positive top-line results. Will report full results at a science conference. Could be a crucial component of a combination therapy. In discussions with potential partners.

The Phase 3 study of VGX-3100 in cervical dysplasia caused by HPV continued, with enrollment on track. Data should be available in 2020. Two phases each will enroll 198 patients. Inovio has a collaboration and license agreement providing ApolloBio Corporation with the exclusive right to develop and commercialize VGX-3100 within Greater China. A Phase 2 study of VGX-3100 for HPV related vulvar neoplasia (VIN) continued. An anal dysplasia Phase 2 started and is cosponsored by the AIDS malignancy consortium.

MedImmune MEDI0457 (was INO-3112) combined with durvalumab, a PD-L1 inhibitor, for HPV-associated head and neck squamous cell carcinoma advanced to Phase 2, triggering a milestone payment. Also expanding to test for other HPV-associated cancers in a separate Phase 2 study.

MedImmune has also selected an Inovio product to treat a specific cancer, with a milestone payment expect in 2H 2018.

Inovio has a subsidiary, Geneos Therapeutics, to develop cancer therapies based on personalized neo-antigens. Geneos plans a capital raise in 2018.

Regeneron and Inovio started a Phase 1/2 combination therapy study for newly diagnosed glioblastoma in November 2017. It combines INO-5401, INO-9012, and Regeneron's REGN2810, a PD-1 inhibitor. Inovio is funding the study. Could get 6 month PFS data in 2019.

INO-5401 with Tecentriq (Roche/Genentech) is starting a Phase 1b/2 trial for advanced bladder cancer, or urothelial carcinoma in October. Patients may have failed prior checkpoint inhibitors. Phase 2 interim data should be available in 2019.

INO-5150 interim Phase 1 data showed activity and a dampened rise of PSA in recurrent prostate cancer. Plans to partner to advance. Data presentation will be made at a major cancer conference this fall.

dMAb PSMA construct shrank prostate tumors in a preclinical study. dMAb antibiotic construct protected mice from lethal doses of pseudomonas.

Inovio is developing Ebola vaccines, including a dMAb (DNA-based monoclonal antibody) version.

Inovio Phase 1 trial for its Zika vaccine, GLS-5700, should complete study in Q3 with data in Q4.

Inovio’s phase I trial to evaluate safety and tolerability of PENNVAX®-GP, the company’s "universal" DNA vaccine for HIV had positive results. Retained immune response 12 months after dosing.

Inovio’s partner for its DNA vaccine (GLS-5300) for Middle East Respiratory Syndrome (MERS), GeneOne Life Science Inc., Phase I/2 trial started in Korea. MERS has no current treatment.

CEPI (Coalition for Epidemic Preparedness Innovations) will provide up to $56 million to support development of INO-4500 for Lassa fever and INO-4700 for MERS. Reported positive Phase 1 MERS results. Another Phase 1 MERS study will start in Korea.

Ongoing studies include INO-1400 in HTERT breast, lung and pancreatic cancer has now been extended to more tumor types: head & neck squamous cell, ovarian, colorectal, gastric and esophageal cancers. Enlarging to 5 trial sites with 54 subjects. The final readout will be in 2018, but could start later stage studies based on earlier cohort data. Believes it will be combined with other vaccines and checkpoint inhibitors.

Completed enrollment of 62 subjects in the phase I study of our INO-5150 prostate cancer immunotherapy.

Initiated a Phase 1 trial for INO-8000 for hepatitis C partnered with the NCI and Mayo Clinic. Will measure safety, tolerability, and immune response.

Inovio also has a variety of other vaccines in clinical or preclinical study. See the Inovio Pipeline for an overview.

Cash and equivalents balance (including short-term investments) ended at $95.6 million, down sequentially from $112.8 million.

R&D expense was $22.5 million. General and administrative expense was $7.2 million. Total operating expenses were $29.7 million. Operating profit negative $5.2 million. Interest and other income $0.8 million. Loss on investment in an affiliated entity was $2.1 million.


ApolloBio, sites in China? Not part of our Reveal1 strategy, but could include in Reveal2, which will start after 1 ends, using mostly the same sites. We are not counting on China in the current timeline.

VGX-3100 HIV unmet need>? Anal dysplasia is a huge unmet medical need. Surgery has high morbidity and pain, plus there is a high recurrence rate. The HIV trial readout would be in 2019, but there is no efficacy data yet, but the hope is it will be similar to cervical dysplasia.

Most of the HIV infected volunteers for the anal dysplasia test have their HIV load pretty well under control. But we are also testing non-HIV patients as a check.

FDA endpoint change guidelines in bladder cancer study? Should not change our study. The first cohort was checkpoint refractory. The second cohort are chemo refractory patients.

Zika study timing? Should complete study this year, data could be released in Q4.

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Copyright 2018 William P. Meyers