Inovio Pharmaceuticals, Inc. (NASDAQ:INO) today reported financial
results for the quarter ended September 30, 2017.
Total revenue was $2.6 million for the three
months ended September 30, 2017, compared to $12.5 million for the
same period in 2016. Total operating expenses were $31.8 million
for the current year quarter compared to $32.7 million for the
prior year quarter.
The net loss attributable to common stockholders
for the quarter ended September 30, 2017 was $34.1 million, or
$0.39 per basic share, compared to $20.8 million, or $0.28 per
share, for the quarter ended September 30, 2016. The increase in
net loss for the quarter resulted primarily from lower revenue
recognized from our DARPA Ebola grant and a higher non-cash
accounting expense related to the change in fair value of our
investment in an affiliated entity.
Revenue
The decrease in revenue was primarily due to
lower revenues recognized due to the nearing of successful
completion of our DARPA Ebola grant.
Operating Expenses
Research and development expenses for the third
quarter of 2017 were $25.5 million compared to $27.0 million for
the third quarter of 2016. The decrease in R&D expenses was
primarily the result of lower expenses incurred related to our
DARPA Ebola grant. General and administrative expenses were $6.3
million for the third quarter of 2017 versus $5.8 million for the
third quarter of 2016. The increase in G&A expenses was
primarily related to an increase in employee headcount.
Capital Resources
As of September 30, 2017, cash and cash
equivalents and short-term investments were $141.9 million compared
with $104.8 million as of December 31, 2016. At quarter end
the company had 90.3 million shares of common stock outstanding and
99.7 million shares of common stock outstanding on a fully diluted
basis.
Inovio’s balance sheet and statement of
operations are provided below. The Form 10-Q providing the complete
2017 third quarter financial report can be found at:
http://ir.inovio.com/investors/financial-reports/default.aspx.
Corporate Update
Cancer Immunotherapies
VGX-3100: Cervical Pre-Cancer (Phase 3)
In June, Inovio commenced its phase 3 clinical
program to evaluate the efficacy of Inovio’s DNA-based
immunotherapy, VGX-3100, to treat cervical dysplasia caused by
human papillomavirus (HPV). In a little over three months since
trial initiation, Inovio has opened nearly 35 sites, recruiting and
dosing patients. The company is on track to open at least 50 sites
by the end of the year.
VGX-3100: Vulvar Pre-Cancer (Phase 2)
In April, Inovio commenced a randomized,
open-label phase 2 trial to evaluate the efficacy of VGX-3100 in
women with high-grade HPV-related vulvar high-grade intraepithelial
lesions (HSIL), a disease with a high unmet medical need. The
primary endpoint of the study is histologic clearance of high-grade
lesions and virologic clearance of the HPV virus in vulvar tissue
samples. The study will also evaluate safety and tolerability.
There are 10 sites in the U.S. open and recruiting patients.
MEDI0457: HPV-Related Head & Neck Cancer
(Phase 1/2)
In May, Inovio announced that MedImmune,
AstraZeneca’s global biologics research and development arm,
commenced a new clinical trial investigating the combination of
MEDI0457 (formerly INO-3112, in-licensed from Inovio), an
immunotherapy designed to generate antigen-specific killer T cell
responses targeting HPV-associated tumors, and durvalumab
(IMFINZI™), MedImmune’s PD-L1 checkpoint inhibitor. The combination
trial will enroll patients with metastatic HPV-associated squamous
cell carcinoma of the head and neck (SCCHN) with persistent or
recurrent disease after chemotherapy treatment. This study marks a
significant moment for Inovio as it transitions into a late-stage
biotechnology company. MedImmune is investigating elevating the
response rate of checkpoint inhibitors by using durvalumab in
combination with a DNA plasmid vaccine originally licensed from
Inovio, which has shown the ability to generate killer T cells.
INO-5401: Metastatic bladder cancer phase 1/2
trial initiated in combination with Genentech’s TECENTRIQ®
In October, Inovio initiated a phase 1b/2
immuno-oncology trial to evaluate Genentech/Roche’s atezolizumab
(TECENTRIQ®) in combination with Inovio’s INO-5401, a T cell
activating immunotherapy encoding multiple antigens, and INO-9012,
an immune activator encoding IL-12. The multi-center, open-label
efficacy trial will be managed by Inovio, and Genentech will supply
atezolizumab. The trial is evaluating the safety, immune response
and clinical efficacy of the combination therapy in approximately
80 patients with advanced bladder cancer, specifically advanced
unresectable or metastatic urothelial carcinoma (UC), the most
common type of bladder cancer. The majority of the patients to be
enrolled in the trial will have previously received and failed to
demonstrate meaningful response to an anti-PD-1 or PD-L1 checkpoint
inhibitor alone. Thus, the study will evaluate the potential
benefit of a checkpoint inhibitor combined with a DNA-based
immunotherapeutic and T cell activator within a bladder cancer
patient population with very limited treatment options and poor
outcomes.
INO-5401: Glioblastoma phase 1/2 trial initiated
in combination with Regeneron’s PD-1 inhibitor
In November, Inovio initiated a phase 1b/2a
immuno-oncology trial in patients with newly diagnosed glioblastoma
(GBM) designed to evaluate Regeneron’s PD-1 inhibitor, REGN2810, in
combination with Inovio’s INO-5401 and INO-9012. The open-label
trial of 50 patients will be conducted at approximately 30 U.S.
sites, and will evaluate safety, tolerability, immune responses as
well as progression-free survival and overall survival. GBM is the
most aggressive brain cancer and its prognosis is extremely poor,
despite a limited number of new therapies approved over the last 10
years. The median overall survival for patients receiving standard
of care therapy is approximately 15 months, and the average
five-year survival rate is less than three percent.
INO-5150: Prostate cancer immunotherapy slowed
PSA rise in patients with recurrent prostate cancer
An interim data analysis from an ongoing
open-label phase 1b study showed that Inovio’s INO-5150 cancer
immunotherapy product generated antigen-specific CD8+ killer T cell
responses measured in peripheral blood from subjects with
biochemically recurrent prostate cancer. In the study, INO-5150
treatment as a monotherapy generated prostate specific antigen
(PSA) and prostate specific membrane antigen (PSMA) specific T cell
responses in peripheral blood in 60% of the subjects. Moreover,
patients with specific CD8+ T cell responses experienced dampening
in the rise of PSA and significant increases in PSA Doubling Times
(PSADT). PSA is a prostate cancer-associated biomarker, and
positive changes in PSA levels could signal INO-5150’s potential
positive impact on the treatment of prostate cancer.
dMAb™ shrunk prostate tumors and protected
against antibiotic-resistant bacterial infection in published
preclinical studies
Two peer-reviewed scientific papers highlighted
the potential impact of dMAb constructs on prostate tumors and in
preventing infection from a pneumonia-causing bacteria in
preclinical studies. A journal article detailed how Inovio’s dMAb
construct against PSMA produced monoclonal antibodies that shrank
prostate tumors in a preclinical animal model. This research
publication is significant because it is the first to report on the
use of Inovio dMAb technology to develop novel monoclonal
antibody-based therapies against cancer targets. In another first,
Inovio also published results of studies in which its dMAb
constructs targeting antibiotic-resistant bacteria protected mice
when challenged with a lethal dose of drug-resistant pseudomonas, a
pneumonia-causing bacteria.
Infectious Disease Vaccines
Positive Zika vaccine clinical data published in
New England Journal of Medicine
In October, Inovio reported positive safety and
immune response results from a first-in-man, multi-center phase 1
trial of a vaccine against the Zika virus. The phase 1 trial of
Inovio’s DNA-based Zika vaccine (GLS-5700) induced high levels of
binding antibodies in 100% of participants. Robust neutralizing
antibody and T cell immune response were also observed in
vaccinated subjects. These positive results were published in the
New England Journal of Medicine in the article, titled “Safety and
Immunogenicity of an Anti-Zika Virus DNA Vaccine,” authored by
Inovio researchers and collaborators. A second phase 1 study, now
fully enrolled with 160 participants in Puerto Rico, is designed
with a placebo control to explore a potential trend towards
clinical efficacy. Inovio is the first company to generate positive
human data that clearly supports advancement of DNA technology and
its Zika vaccine candidate.
Fully-funded phase 1/2 MERS trial initiated in
South Korea
Following approval by the Korean Ministry of
Food and Drug Safety, in September, Inovio and its development
partner, GeneOne Life Science, initiated a study to evaluate
GLS-5300, Inovio’s vaccine against the MERS virus (Middle East
Respiratory Syndrome), in a phase 1/2a trial. The International
Vaccine Institute (IVI) is fully funding this trial utilizing a $34
million grant from the Samsung Foundation provided to IVI in 2015
to support the development of a MERS vaccine. This phase 1/2a trial
represents the second clinical trial of GLS-5300, which remains the
first and only MERS vaccine being tested in humans. In the
first phase 1 MERS study conducted in the United States, high
levels of binding antibodies were measured in 92% of evaluated
subjects. Significant antigen-specific cytotoxic T-lymphocyte (CTL)
responses were also observed.
Lassa fever vaccine advances
Demonstrating its commitment to global public
health, in October, Inovio announced positive results of a
preclinical study in which a DNA vaccine provided protection
against the Lassa fever virus, which infects about 300,000 people
annually. In the study, partnered with U.S. Army scientists and
fully funded by a grant from the NIH, Inovio’s DNA vaccine provided
100% protection for non-human primates challenged with a lethal
dose of the Lassa fever virus. Inovio’s DNA-based platform is
especially well-suited to rapidly respond to viral outbreaks and
newly emerging pathogens due to its safety profile, ease and speed
of development and manufacturing, as well as the ability to be
shipped and stored without a cold-chain environment.
About Inovio Pharmaceuticals,
Inc.
Inovio is taking immunotherapy to the next level
in the fight against cancer and infectious diseases. We are the
only immunotherapy company that has reported generating T cells in
vivo in high quantity that are fully functional and whose killing
capacity correlates with relevant clinical outcomes with a
favorable safety profile. With an expanding portfolio of
immunotherapies, the company is advancing a growing preclinical and
clinical stage product pipeline. Partners and collaborators include
or have included MedImmune, Regeneron, Genentech, The Wistar
Institute, University of Pennsylvania, DARPA, GeneOne Life Science,
Plumbline Life Sciences, ApolloBio Corporation, Drexel University,
National Microbiology Laboratory of the Public Health Agency of
Canada, NIH, HIV Vaccines Trial Network, NIAID, U.S. Army Medical
Research Institute of Infectious Diseases and U.S. Military HIV
Research Program. For more information, visit www.inovio.com.
This press release contains certain
forward-looking statements relating to our business, including our
plans to develop electroporation-based drug and gene delivery
technologies and DNA vaccines, our expectations regarding our
research and development programs, including the planned initiation
and conduct of clinical trials and the availability and timing of
data from those trials, and the sufficiency of our capital
resources. Actual events or results may differ from the
expectations set forth herein as a result of a number of factors,
including uncertainties inherent in pre-clinical studies, clinical
trials and product development programs, the availability of
funding to support continuing research and studies in an effort to
prove safety and efficacy of electroporation technology as a
delivery mechanism or develop viable DNA vaccines, our ability to
support our pipeline of SynCon® active immunotherapy and vaccine
products, the ability of our collaborators to attain development
and commercial milestones for products we license and product sales
that will enable us to receive future payments and royalties, the
adequacy of our capital resources, the availability or potential
availability of alternative therapies or treatments for the
conditions targeted by the company or its collaborators, including
alternatives that may be more efficacious or cost effective than
any therapy or treatment that the company and its collaborators
hope to develop, issues involving product liability, issues
involving patents and whether they or licenses to them will provide
the company with meaningful protection from others using the
covered technologies, whether such proprietary rights are
enforceable or defensible or infringe or allegedly infringe on
rights of others or can withstand claims of invalidity and whether
the company can finance or devote other significant resources that
may be necessary to prosecute, protect or defend them, the level of
corporate expenditures, assessments of the company's technology by
potential corporate or other partners or collaborators, capital
market conditions, the impact of government healthcare proposals
and other factors set forth in our Annual Report on Form 10-K for
the year ended December 31, 2016, our Form 10-Q for the
quarterly period ended September 30, 2017, and other regulatory
filings we make from time to time. There can be no assurance that
any product candidate in Inovio's pipeline will be successfully
developed, manufactured or commercialized, that final results of
clinical trials will be supportive of regulatory approvals required
to market licensed products, or that any of the forward-looking
information provided herein will be proven accurate.
Forward-looking statements speak only as of the date of this
release, and Inovio undertakes no obligation to update or revise
these statements, except as may be required by law.
Inovio Pharmaceuticals, Inc.
CONSOLIDATED BALANCE SHEETS
|
|
|
|
|
September 30, 2017 |
|
December 31, 2016 |
|
(Unaudited) |
|
|
ASSETS |
|
|
|
Current
assets: |
|
|
|
Cash and cash
equivalents |
$ |
23,278,392 |
|
|
$ |
19,136,472 |
|
Short-term
investments |
118,611,601 |
|
|
85,629,412 |
|
Accounts
receivable |
6,237,078 |
|
|
15,821,511 |
|
Accounts receivable
from affiliated entities |
924,677 |
|
|
748,355 |
|
Prepaid expenses and
other current assets |
4,538,843 |
|
|
1,749,059 |
|
Prepaid expenses and
other current assets from affiliated entities |
997,213 |
|
|
1,512,424 |
|
Total current
assets |
154,587,804 |
|
|
124,597,233 |
|
Fixed assets, net |
18,471,231 |
|
|
9,025,446 |
|
Investment in
affiliated entity - GeneOne |
8,776,603 |
|
|
16,052,065 |
|
Investment in
affiliated entity - PLS |
2,720,045 |
|
|
3,777,510 |
|
Intangible assets,
net |
6,413,792 |
|
|
7,628,394 |
|
Goodwill |
10,513,371 |
|
|
10,513,371 |
|
Other assets |
2,197,182 |
|
|
2,113,147 |
|
Total
assets |
$ |
203,680,028 |
|
|
$ |
173,707,166 |
|
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
Current
liabilities: |
|
|
|
Accounts payable and
accrued expenses |
$ |
22,527,486 |
|
|
$ |
19,597,787 |
|
Accounts payable and
accrued expenses due to affiliated entities |
782,878 |
|
|
1,072,579 |
|
Accrued clinical trial
expenses |
7,920,045 |
|
|
6,368,389 |
|
Common stock
warrants |
940,341 |
|
|
1,167,614 |
|
Deferred revenue |
179,523 |
|
|
14,762,720 |
|
Deferred revenue from
affiliated entities |
243,986 |
|
|
407,292 |
|
Deferred rent |
769,313 |
|
|
446,646 |
|
Total current
liabilities |
33,363,572 |
|
|
43,823,027 |
|
Deferred revenue, net
of current portion |
164,604 |
|
|
317,808 |
|
Deferred revenue from
affiliated entities, net of current portion |
— |
|
|
86,694 |
|
Deferred rent, net of
current portion |
7,857,879 |
|
|
5,926,424 |
|
Deferred tax
liabilities |
174,793 |
|
|
174,793 |
|
Total
liabilities |
41,560,848 |
|
|
50,328,746 |
|
Inovio
Pharmaceuticals, Inc. stockholders’ equity: |
|
|
|
Preferred stock |
— |
|
|
— |
|
Common stock |
90,295 |
|
|
74,062 |
|
Additional paid-in
capital |
663,223,094 |
|
|
556,718,356 |
|
Accumulated
deficit |
(501,850,138 |
) |
|
(434,838,235 |
) |
Accumulated other
comprehensive income |
559,660 |
|
|
1,327,968 |
|
Total Inovio
Pharmaceuticals, Inc. stockholders’ equity |
162,022,911 |
|
|
123,282,151 |
|
Non-controlling
interest |
96,269 |
|
|
96,269 |
|
Total stockholders’
equity |
162,119,180 |
|
|
123,378,420 |
|
Total
liabilities and stockholders’ equity |
$ |
203,680,028 |
|
|
$ |
173,707,166 |
|
|
|
|
|
|
|
|
|
Inovio Pharmaceuticals, Inc.
CONSOLIDATED STATEMENTS OF
OPERATIONS
(Unaudited)
|
|
|
|
|
Three Months Ended September
30, |
|
Nine Months Ended September
30, |
|
2017 |
|
2016 |
|
2017 |
|
2016 |
Revenues: |
|
|
|
|
|
|
|
Revenue under
collaborative research and development arrangements |
$ |
351,272 |
|
|
$ |
2,327,316 |
|
|
$ |
20,998,174 |
|
|
$ |
6,014,161 |
|
Revenue under
collaborative research and development arrangements with affiliated
entities |
129,133 |
|
|
574,596 |
|
|
539,342 |
|
|
1,211,316 |
|
Grants and
miscellaneous revenue |
1,456,216 |
|
|
9,410,648 |
|
|
9,494,096 |
|
|
19,401,029 |
|
Grants and
miscellaneous revenue from affiliated entity |
707,922 |
|
|
227,903 |
|
|
2,401,240 |
|
|
227,903 |
|
Total
revenues |
2,644,543 |
|
|
12,540,463 |
|
|
33,432,852 |
|
|
26,854,409 |
|
Operating
expenses: |
|
|
|
|
|
|
|
Research and
development |
25,510,239 |
|
|
26,980,343 |
|
|
73,931,494 |
|
|
64,800,304 |
|
General and
administrative |
6,319,775 |
|
|
5,755,603 |
|
|
20,256,470 |
|
|
16,926,746 |
|
Gain on sale of
assets |
— |
|
|
— |
|
|
— |
|
|
(1,000,000 |
) |
Total operating
expenses |
31,830,014 |
|
|
32,735,946 |
|
|
94,187,964 |
|
|
80,727,050 |
|
Loss from
operations |
(29,185,471 |
) |
|
(20,195,483 |
) |
|
(60,755,112 |
) |
|
(53,872,641 |
) |
Other income
(expense): |
|
|
|
|
|
|
|
Interest and other
income, net |
463,346 |
|
|
391,596 |
|
|
1,103,708 |
|
|
1,065,797 |
|
Change in fair value of
common stock warrants, net |
423,296 |
|
|
2,690 |
|
|
227,273 |
|
|
(517,334 |
) |
Gain (loss) on
investment in affiliated entity |
(5,835,741 |
) |
|
(958,141 |
) |
|
(7,275,462 |
) |
|
5,817,309 |
|
Net loss
attributable to Inovio Pharmaceuticals, Inc. |
$ |
(34,134,570 |
) |
|
$ |
(20,759,338 |
) |
|
$ |
(66,699,593 |
) |
|
$ |
(47,506,869 |
) |
Net loss per
share attributable to Inovio Pharmaceuticals, Inc.
stockholders |
|
|
|
|
|
|
|
Basic |
$ |
(0.39 |
) |
|
$ |
(0.28 |
) |
|
$ |
(0.85 |
) |
|
$ |
(0.65 |
) |
Diluted |
$ |
(0.40 |
) |
|
$ |
(0.28 |
) |
|
$ |
(0.85 |
) |
|
$ |
(0.65 |
) |
Weighted
average number of common shares outstanding |
|
|
|
|
|
|
|
Basic |
86,952,024 |
|
|
73,602,834 |
|
|
78,894,881 |
|
|
72,932,199 |
|
Diluted |
87,090,683 |
|
|
73,789,008 |
|
|
79,043,480 |
|
|
72,932,199 |
|
|
|
|
|
|
|
|
|
|
|
|
|
CONTACTS:Investors/Media: Jeff Richardson,
Inovio Pharmaceuticals, 267-440-4211, jrichardson@inovio.com
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