Results & Analyst Call Summary

Conference date: March 12, 2019 @ 1:30 PM Pacific Time
for quarter ending: December 31, 2018 (Q4, fourth 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 $2.5 million, up sequentially from $2.0 million, and down from $8.8 million in the year-earlier quarter.

Net income was negative $33.0 million, down sequentially from negative $25.0 million, and down from negative $21.5 million year-earlier.

EPS (earnings per share, diluted) was negative $0.34, down sequentially from negative $0.27, and down from negative $0.24 year-earlier.

Guidance:

Net cash burn approximately $70 million for 2019.

Quarter Highlights:

Dr. J. Joseph Kim, Inovio's CEO said, "Our Phase 3 program for VGX-3100 is advancing with REVEAL 1 nearing complete enrollment and the opening of sites for REVEAL 2. Moreover, Inovio continues to generate impressive efficacy data for HPV-related head and neck cancers, further validating our objective to be the global leader in treating HPV-related diseases. The announcement of the second patient achieving full cancer remission in January provides additional corroboration for Inovio's overall cancer combination strategy using a T cell activator combined with a checkpoint inhibitor against an array of cancers with big pharma partners providing various checkpoint inhibitors. With interim efficacy data expected later this year from our INO-5401 programs, we believe Inovio is well-positioned to continue to build upon its synthetic DNA immunotherapy approach, while continuing to leverage our current partnerships and seeking to form new ones."

The Phase 3 study of VGX-3100 in cervical dysplasia caused by HPV continued, with enrollment on track. Full enrollment of Reveal 1 nearing completion, with Reveal 2 enrolling as of March 2019. Data should be available in 2020 with a BLA submission in 2021. 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 continued and is cosponsored by the AIDS malignancy consortium with both HIV positive and negative patients.

MedImmune MEDI0457 (was INO-3112) combined with durvalumab, a PD-L1 inhibitor, for HPV-associated head and neck squamous cell carcinoma is in Phase 2. Also expanding to test for other HPV-associated cancers in a separate Phase 2 study. One head and neck patient achieved full remission. In December announced a second Phase 2 study of MEDI0457 with with durvalumab targeting a broad array of cancers associated with HPV. The treatment of the first patient with cervical cancer in this trial resulted in a milestone payment from AstraZeneca to Inovio. Study results showed MEDI0457 turned "cold" cancers hot, allowing durvalumab to work.

MedImmune has also selected MEDI0457 combined with durvalumab to treat a HPV cancer other than head and neck, with a milestone payment expected in 2018.

HPV related cancers have spiked 44% since 1999. There were 570,000 HPV associated cervical cancer cases worldwide in 2018. Treatment unmet need is high.

Inovio has a subsidiary, Geneos Therapeutics, to develop cancer therapies based on personalized neo-antigens. Geneos raised $10.5 million in capital in February 2019.

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) continued a Phase 1b/2 trial for advanced bladder cancer, or urothelial carcinoma. Patients may have failed prior checkpoint inhibitors. Phase 2 interim data should be available in 2019.

INO-5401 with INO-9012 is in a Phase 1/2 trial combined with Regeneron's cemiplimab for newly diagnosed glioblastoma. 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. Data presentation was made at ESMO showed 86% of patients progression free at week 72. Plans to partner remain on track.

In February 2019, the company dosed the first subject in the first-ever human study of Inovio's DNA-encoded monoclonal antibody (dMAb) technology evaluating the dMAb's (INO-A002) ability to prevent or treat Zika virus infection. This study is being fully funded by The Bill and Melinda Gates Foundation.

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

Inovio Phase 1 trial for its Zika vaccine, GLS-5700, should report data in 2019.

Inovio’s randomized trial to evaluate safety and tolerability of PENNVAX®-GP, the company’s "universal" DNA vaccine for HIV continued enrollment. Interim results expected in 2019.

Inovio plans to initiate a Phase 2 MERS vaccine field trial in the Middle East with full CEPI funding in 2H 2019. Reported positive Phase 1 MERS results. A Phase 1/2 MERS study in Korea should report results in 2019.

Inovio received IND approval for another CEPI funded vaccine for combatting Lassa fever, which will advance into the first human trial in the second quarter.

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 INO-5150 prostate cancer immunotherapy.

A Phase 1 trial for INO-8000 for Hepatitis C continued, 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 $81.2 million, down sequentially from $85.5 million. In February and March 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.

R&D expense was $26.4 million. General and administrative expense was $5.6 million. Total operating expenses were $32.0 million. Operating profit negative $29.5 million. Interest and other income $na million. gain on investment in an affiliated entity was $na million. Change in value of warrants $na million.

Q&A summary:

Reveal trial timelines? 198 patients each. Believe efficacy and safety data should be achieved in late 2020, assuming full enrollment. Reveal 2 was launched a couple of weeks ago, with the first dosing expected in April.

GBM combo trial timeline? 5401 study endpoint is improvement in overall survival at 12 and 18 months. PFS at 6 months is being used as an early indicator. Should have PFS 12 for most patients before year-end 2019. OS numbers are more definitive than PFS.

MEDI0457 next data set? We are very excited about this program. We are growing a body of evidence. Timing is up to AstraZeneca. Phase 2 trial data is next to come out, probably in coming quarters. A third indication should be dosed this quarter, triggering a third Phase 2 milestone from AZ to Inovio. This all supports the thesis that combining our HPV vaccine with an IO therapy will get better results than IO monotherapies.

Reveal 1 has a one year follow up safety period, Reveal 2 has just 1 month.

Gave a general description of the advantages of dMab plaform over conventional monoclonal antibodies.

GBM issue with steroids interfering with the therapy? Our trial is on newly diagnosed patients. GBM has been a challenge for checkpoint monotherapy, but it has been a challenge for all therapies. We think our strategy of combining the checkpoint inhibitor with hTert should work.

GLS5700 Zika trial in Puerto Rico vs. new dMab candidate? All the samples have been collected, we are doing the analysis now. Will report as soon as we have the full set of data. Whether either or both programs go forward depends on results and funders.

Evidence that head and neck successes were do to the Inovio vaccine? Yes, we showed the biomarkers that indicate that. Further patient responses could confirm that.

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