PLYMOUTH MEETING, Penn.,
Aug. 11, 2014 /PRNewswire/ -- Inovio
Pharmaceuticals, Inc. (NYSE MKT: INO) today reported financial
results for the quarter ended June 30,
2014.
Total revenue was $3.8 million and
$6.2 million for the three and six
months ended June 30, 2014, compared
to $786,000 and $2.2 million for the same periods in 2013.
Total operating expenses were $14.0
million and $26.3 million for
the three and six months ended June 30,
2014, compared to $6.5 million
and $14.5 million for the same
periods in 2013.
The loss from operations prior to other income (expenses) for
the three and six months ended June 30,
2014, was $10.2 million, or
$0.17 per share, and $20.2 million, or $0.35 per share, compared to $5.7 million, or $0.13 per share, and $12.3
million, or $0.29 per share,
for the same periods in 2013.
The net loss attributable to common stockholders for the three
and six months ended June 30, 2014,
was $10.7 million, or $0.18 per share, and $21.5
million, or $0.37 per share,
compared to $10.9 million, or
$0.24 per share, and $19.7 million, or $0.47 per share, for the same periods in
2013.
The $0.2 million and $1.8 million increase in net loss attributable to
common stockholders for the three and six months ended June 30, 2014, compared with the same periods in
2013 resulted primarily from an increase in R&D and clinical
development expenses as well as non-cash stock-based
compensation.
Dr. J. Joseph Kim, President and
CEO, said, "Our second quarter marked a historical step for Inovio
with the reporting of positive efficacy data from our HPV
immunotherapeutic phase II study. We are extremely pleased with the
comprehensive data outcomes of this study, including an impressive
level of complete CIN 2/3 clearance, and their implications for
VGX-3100 to potentially fulfill a significant unmet need as a
non-surgical first-line treatment alternative for these cervical
precancers. We are now in a position every biotechnology company
hopes to reach, which is to have a product candidate with the merit
to advance into a phase III registration study on the path toward
commercialization. We are now making that commitment with
VGX-3100.
"Apart from the positive outcome for our HPV franchise, this
exciting data opens many new doors for the advancement and
expansion of our broad cancer and infectious disease immune therapy
developments. We are on the right path toward creating important
and valuable therapies to help mankind."
Revenue
The increase in revenue for the comparable periods primarily
consisted of development fees paid by Roche for work conducted
towards our partnership with Roche.
Operating Expenses
Research and development expenses for the three and six months
ended June 30, 2014, were
$9.6 million and $17.8 million, compared to $4.4 million and $9.5
million for the same periods in 2013. The increase for the
three and six-month periods was primarily related to work conducted
under our Roche partnership, an increase in non-cash stock-based
compensation, and expenses relating to preparations for future
clinical trials. General and administrative expenses for the three
and six months ended June 30, 2014,
were $4.3 million and $8.5 million versus $3.0
million and $6.0 million for
the same periods in 2013.
Capital Resources
As of June 30, 2014, cash and cash
equivalents, short-term investments and restricted cash were
$109.0 million compared with
$52.7 million as of December 31,
2013. This increase was primarily due to the net proceeds from our
March 2014 financing and warrants and
options exercised during the period.
As of June 30, 2014, the company
had 60.3 million shares outstanding and 66.7 million fully
diluted.
Based on management's projections and analysis, the Company
believes that cash, cash equivalents and short-term investments are
sufficient to meet its planned working capital requirements through
the end of 2017. The Company plans to raise additional cash
as necessary to fund the phase III development of VGX-3100.
Inovio's balance sheet and statement of operations is provided
below. Form 10-Q providing the complete 2014 second quarter
financial report can be found at:
http://ir.inovio.com/secfilings.
Corporate Update
Clinical Development
Subsequent to the quarter, Inovio released top line efficacy
data from its randomized, placebo-controlled, double-blind phase II
clinical trial (HPV-003) for VGX-3100, its SynCon®
immunotherapy against HPV-caused precancers and cancers delivered
with its CELLECTRA® electroporation device. Treatment
was randomized 3:1 between the VGX-3100 and placebo groups, and was
stratified by age and severity of CIN. The primary endpoint,
histologic regression, was evaluated 36 weeks after the first
treatment. In the per protocol analysis of this three-immunization
regimen, CIN 2/3 resolved to CIN 1 or no disease in 53 of 107
(49.5%) women treated with VGX-3100 compared to 11 of 36 (30.6%)
who received placebo. This difference was statistically significant
(p<0.025). The intent to treat result was also statistically
significant. There was also a high level of complete CIN 2/3
clearance.
This trial also demonstrated virological clearance of HPV 16 or
18 from the cervix in conjunction with histopathological regression
of cervical dysplasia to CIN 1 or no disease, a secondary endpoint
of the trial, in 43 of 107 (40.2%) VGX-3100 recipients compared to
5 of 35 (14.3%) placebo recipients (p<0.025). Robust T cell
activity was detected in subjects who received VGX-3100 compared to
those who received placebo.
Detailed study findings will be submitted for publication in a
peer-reviewed scientific journal.
Persistent and untreated cervical precancers lead to cervical
cancer. Currently the only available treatment for cervical
precancers is surgery. There is a significant unmet need for an
immunotherapy for high grade cervical precancers caused by HPV
that, unlike current surgical procedures, does not pose risk of
causing pre-term births, and may also eliminate HPV throughout the
body (not just at the surgical treatment site) and reduce the risk
of new or recurrent precancers. Such a non-surgical treatment would
provide an appealing alternative to caregivers and their patients.
The various outcomes described by the comprehensive phase II data
set combined with the broad advantages of VGX-3100 as a
non-surgical approach therefore create a unique opportunity for
this HPV immunotherapy as a first-line treatment alternative.
Inovio has consequently committed to advancing VGX-3100 into a
phase III registration study with target patient characteristics
and a treatment regimen similar to the phase II study. The Company
expects to complete its end-of-phase-II meeting with the FDA in
2015 and begin treating women in a phase III study in early
2016.
Inovio is also broadening its therapeutic HPV franchise to
include other precancers caused by HPV infection such as vulvar,
vaginal, and other anogenital neoplasia as well as cancers of the
cervix, head & neck, and anogenital areas. During the quarter,
Inovio initiated two separate phase I/IIa clinical studies of
VGX-3100 against HPV-caused cervical cancer and head and neck
cancer. Both of these studies incorporate an immune activator,
DNA-based IL-12, which has been shown to further boost already high
levels of antigen-specific T cells generated by the vaccine. This
combination is designated INO-3112. These studies reflect our
intent and concerted effort to become the leader of immune
therapeutics targeting HPV-related diseases, with their significant
global medical implications and costs.
Inovio will independently advance the clinical programs for
VGX-3100, including the phase III study for CIN 2/3, and its
broader HPV franchise for associated diseases but will consider
partnering opportunities that serve to maximize the long term
financial benefit to the Company and its shareholders.
Beyond the direct clinical implications for VGX-3100, the phase
II efficacy results are a breakthrough for the field of
immunotherapies by demonstrating a clear clinical effect of an
active immunotherapy agent in a randomized, placebo controlled
study. They de-risk and will broadly contribute to the advancement
of our product and business development strategy.
Inovio previously stated that it expected a phase I study of its
prostate cancer immunotherapy, INO-5150, to be initiated in 3Q
2014. This phase I study was designed to study safety and
immunogenicity of INO-5150 (encoded for PSA and PSMA antigens) in a
biochemically relapsed prostate cancer population. In a
strategic review, Roche and Inovio determined that castrate
resistant prostate cancer is a more favorable setting for timely
development and potential integration of immunomodulatory drugs
from Roche's pipeline. The development team consequently decided to
reposition this study to a phase Ia/Ib study in this
population.
As part of this decision, the team determined that strategically
it would be more proactive and timely to immediately assess a more
comprehensive set of parameters and combinations of (i) INO-5150,
(ii) additional new prostate cancer antigens that the team has been
developing under the Roche/Inovio research collaboration, and (iii)
Roche's portfolio of immunomodulatory drugs including checkpoint
inhibitors. The team is working to complete a phase Ia/Ib multi-arm
study design reflecting this strategy and anticipates initiating
this study in 2015.
Inovio intends to initiate a phase I study for its global,
multi-clade PENNVAX®-GP preventive and therapeutic HIV
DNA vaccine candidate late 2014. The development of this product
was funded in part by a $25 million
contract from the NIH. Phase I data from Inovio's
PENNVAX®-B preventive HIV DNA vaccine (targeting only
clade B viruses) in non-infected subjects showed best-in-class T
cell responses.
Inovio plans to initiate an exploratory human study for
INO-1400, its hTERT DNA immunotherapy, for breast, lung and
pancreatic cancers in the second half of 2014. hTERT is
over-expressed in 85% of cancers. As a result, this immunotherapy
has the potential to serve as a "universal" immune therapeutic
agent for cancer. INO-1400 represents the first of several new
broadly-applicable cancer-specific antigens in Inovio's growing
oncology product development arsenal that we intend to advance into
human studies.
Preclinical Development
In 2Q, Inovio announced that data from a rhesus monkey study of
INO-8000, its multi-antigen DNA immunotherapy targeting hepatitis C
genotypes 1a and 1b, was published in Human Vaccines &
Immunotherapeutics in a paper entitled, "Strong HCV NS3/4a,
NS4b, NS5a, NS5b-specific cellular immune responses induced in
rhesus macaques by a novel HCV genotype 1a/1b consensus DNA
vaccine." This paper highlighted the killing effect of the
antigen-specific T cells stimulated by Inovio's multi-antigen
SynCon® immunotherapy. INO-8000 (a.k.a. VGX-6500) is
being studied in a phase I/IIa clinical trial in Korea in
collaboration with GeneOne Life Sciences, Inc. Inovio plans to
launch a related multi-site study in the US.
Data from a preclinical study of our multi-antigen DNA
immunotherapy for tuberculosis (TB) was published in Human
Vaccines and Immunotherapy in a paper entitled: "Multivalent TB
vaccines targeting the esx gene family generate potent and broad
cell-mediated immune responses superior to BCG." Results from this
study indicated that this DNA vaccine is highly immunogenic and
induces robust broad-spectrum T cell responses with the ability to
surpass BCG (the current live-attenuated TB vaccine)-induced
esx-specific T cell responses on a stand-alone basis or in a prime
boost regimen using a BCG prime followed by a DNA vaccine
boost.
At the 17th Annual Meeting of the American Society of Gene &
Cell Therapy in Washington, DC,
Inovio presented preclinical study data of our DNA-based
therapeutic monoclonal antibody (mAb) targeting Chikungunya virus
(CHIKV). In this presented study, Inovio demonstrated that the
treatment of the animals with Inovio's anti-CHIKV mAb plasmids
protected 100% of the treated animals from a lethal injection of
CHIKV virus while 100% of the control animals died. The treated
animals were spared of virus-related morbidity, as measured by
weight loss and lethargy. Inovio also demonstrated that the serum
of transfected animals exhibited the specific ability to bind to
the CHIKV envelope antigen and this serum possessed
CHIKV-neutralizing activity.
Subsequent to the quarter, data was published from a mice study
of Inovio's DNA immunotherapy for C. difficile, a bacterial
infection that causes severe intestinal distress and symptoms such
as diarrhea, nausea, colitis, sepsis, and even death. This immune
therapy, delivered with electroporation, produced high levels of
neutralizing antibodies that protected 100% of mice and non-human
primates from a lethal dose of C. difficile toxin. The data was
published in the Journal of Infection and Immunity in a
paper titled, "An Optimized, Synthetic DNA Vaccine Encoding the
Toxin A and Toxin B Receptor Binding Domains of Clostridium
difficile Induces Protective Antibody Responses In Vivo." This
vaccine is being tested in collaboration with Dr. Michele Kutzler at Drexel
University. Clostridium difficile infection is a major
source of morbidity and mortality in the US, with half a
million and approximately 30,000 deaths annually and a
significant related healthcare cost.
Corporate Development
In 2Q, Inovio expanded its existing license agreement with the
University of Pennsylvania, adding
exclusive worldwide rights to technology and intellectual property
for novel synthetic therapies against cancer, infectious diseases
and new immune activators. This amendment broadens and strengthens
the Company's patent protection covering candidate products for
dengue fever, H7N9 influenza, additional HPV serotypes and
additional cancer antigens. The amended agreement also provides
Inovio global rights to DNA-based synthetic antibodies, immune
activators (IL-21, IL-23 & IL-33), and immune therapies for
Middle East Respiratory Syndrome (MERS) and tuberculosis.
Inovio's 91%-owned subsidiary, VGX Animal Health, Inc. (VAH),
concluded an agreement for the sale of its animal health assets to
Plumbline Life Sciences, Inc. (PLS) of Korea. The assets
transferred include an exclusive license with Inovio for animal
applications of its growth hormone-releasing hormone (GHRH)
technology and animal DNA vaccines plus a non-exclusive license to
Inovio electroporation delivery systems for these applications. VGX
Animal Health will receive $2 million
in cash in multiple payments and 20% of the outstanding shares of
PLS. VAH's 20% equity ownership position in PLS will be maintained
without dilution up to $10 million of
additional equity fundraising by PLS. Inovio will receive milestone
payments and royalties on product sales and retains the human
applications of its GHRH technology.
Inovio acquired worldwide rights (excluding China) for novel technology to generate
inducible regulatory T cells, with applications such as Alzheimer's
disease and multiple sclerosis. This technology is based on
patent-protected and published discoveries from Dr. Bin Wang, a
professor at Fudan University's Shanghai Medical College, and his
collaborators. Inovio will make clinical and regulatory milestone
payments to the University.
Inovio continues to work toward partnerships with other large
pharmaceutical companies interested in Inovio SynCon®
immunotherapy and vaccine products.
On June 5, 2014, Inovio
implemented a 1-for-4 reverse split of the Company's common stock.
At the end of the second quarter, Inovio was added to the Russell
Global, Russell 2000® and Russell Microcap®
Indexes.
About Inovio Pharmaceuticals, Inc.
Inovio is revolutionizing the fight against cancer and
infectious diseases. Our immunotherapies uniquely activate
best-in-class immune responses to prevent and treat disease, and
have shown clinically significant efficacy with a favorable safety
profile. With an expanding portfolio of immune therapies, the
company is advancing a growing preclinical and clinical stage
product pipeline. Partners and collaborators include Roche,
University of Pennsylvania, NIH, HIV
Vaccines Trial Network, National Cancer Institute, U.S.
Military HIV Research Program, and University of
Manitoba. 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 and 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
(including, but not limited to, the fact that pre-clinical and
clinical results referenced in this release may not be indicative
of results achievable in other trials or for other indications,
that the studies or trials may not be successful or achieve the
results desired, including safety and efficacy for VGX-3100, that
pre-clinical studies and clinical trials may not commence or be
completed in the time periods anticipated, that results from one
study may not necessarily be reflected or supported by the results
of other similar studies and that results from an animal study may
not be indicative of results achievable in human studies), 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 broad pipeline of SynCon®
active immune therapy and vaccine products, 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, evaluation
of potential opportunities, 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, 2013, our Form 10-Q for the
quarter ended June 30, 2014, and
other regulatory filings from time to time. There can be no
assurance that any product in Inovio's pipeline will be
successfully developed or manufactured, that final results of
clinical studies 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.
|
INOVIO
PHARMACEUTICALS, INC.
CONDENSED
CONSOLIDATED BALANCE SHEETS
(Unaudited)
|
|
|
June
30,
2014
|
|
December 31,
2013
|
|
(Unaudited)
|
|
|
ASSETS
|
|
|
|
Current
assets:
|
|
|
|
Cash and cash
equivalents
|
$
|
88,535,184
|
|
$
|
33,719,796
|
Short-term
investments
|
20,322,793
|
|
18,905,608
|
Accounts
receivable
|
2,876,652
|
|
3,301,563
|
Prepaid expenses and
other current assets
|
673,890
|
|
637,433
|
Prepaid expenses and
other current assets from affiliated entity
|
473,225
|
|
2,057,350
|
Deferred tax
asset
|
61,839
|
|
61,839
|
Total current
assets
|
112,943,583
|
|
58,683,589
|
Restricted
cash
|
100,930
|
|
100,762
|
Fixed assets,
net
|
4,549,463
|
|
2,886,545
|
Investment in
affiliated entity
|
7,829,464
|
|
9,664,587
|
Intangible assets,
net
|
5,241,317
|
|
5,718,778
|
Goodwill
|
10,113,371
|
|
10,113,371
|
Common stock
warrants
|
881,000
|
|
717,500
|
Other
assets
|
493,435
|
|
402,075
|
Total
assets
|
$
|
142,152,563
|
|
$
|
88,287,207
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
Current
liabilities:
|
|
|
|
Accounts payable and
accrued expenses
|
$
|
5,286,033
|
|
$
|
5,444,508
|
Accounts payable and
accrued expenses due to affiliated entity
|
704,500
|
|
522,255
|
Accrued clinical
trial expenses
|
1,718,741
|
|
1,446,180
|
Common stock
warrants
|
3,107,059
|
|
19,540,583
|
Deferred
revenue
|
355,041
|
|
1,624,388
|
Deferred revenue from
affiliated entity
|
432,291
|
|
388,542
|
Total current
liabilities
|
11,603,665
|
|
28,966,456
|
Deferred revenue, net
of current portion
|
2,738,915
|
|
1,997,333
|
Deferred revenue from
affiliated entity, net of current portion
|
1,024,194
|
|
1,211,694
|
Deferred
rent
|
4,321,995
|
|
3,013,263
|
Deferred tax
liabilities
|
195,778
|
|
195,778
|
Total
liabilities
|
19,884,547
|
|
35,384,524
|
Inovio
Pharmaceuticals, Inc. stockholders' equity:
|
|
|
|
Common
stock
|
60,318
|
|
52,577
|
Additional paid-in
capital
|
439,144,564
|
|
348,267,389
|
Accumulated
deficit
|
(317,321,311)
|
|
(295,788,577)
|
Accumulated other
comprehensive loss
|
(47,363)
|
|
(76,365)
|
Total Inovio
Pharmaceuticals, Inc. stockholders' equity
|
121,836,208
|
|
52,455,024
|
Non-controlling
interest
|
431,808
|
|
447,659
|
Total stockholders'
equity
|
122,268,016
|
|
52,902,683
|
Total liabilities
and stockholders' equity
|
$
|
142,152,563
|
|
$
|
88,287,207
|
|
INOVIO
PHARMACEUTICALS, INC
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
|
|
|
Three Months
Ended
June 30,
|
Six Months
Ended
June
30,
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
Revenues:
|
|
|
|
|
|
|
Revenue under
collaborative research and development arrangements
|
$
|
3,107,781
|
|
$
|
14,311
|
|
$
|
4,543,508
|
|
$
|
28,570
|
Revenue under
collaborative research and development arrangements with affiliated
entity
|
137,500
|
|
106,250
|
|
254,464
|
|
212,500
|
Grants and
miscellaneous revenue
|
556,381
|
|
665,049
|
|
1,361,333
|
|
1,999,765
|
Total
revenues
|
3,801,662
|
|
785,610
|
|
6,159,305
|
|
2,240,835
|
Operating
expenses:
|
|
|
|
|
|
|
|
Research and
development
|
9,607,281
|
|
4,411,082
|
|
17,832,761
|
|
9,526,194
|
General and
administrative
|
4,347,327
|
|
3,046,586
|
|
8,479,545
|
|
6,020,739
|
Gain on sale of
assets
|
—
|
|
(1,000,000)
|
|
—
|
|
(1,000,000)
|
Total operating
expenses
|
13,954,608
|
|
6,457,668
|
|
26,312,306
|
|
14,546,933
|
Loss from
operations
|
(10,152,946)
|
|
(5,672,058)
|
|
(20,153,001)
|
|
(12,306,098)
|
Other income
(expense):
|
|
|
|
|
|
|
|
Interest and other
income, net
|
68,999
|
|
37,391
|
|
121,075
|
|
76,851
|
Change in fair value
of common stock warrants
|
824,390
|
|
(3,199,878)
|
|
318,464
|
|
(4,627,494)
|
Loss on investment in
affiliated entity
|
(1,458,160)
|
|
(2,032,051)
|
|
(1,835,123)
|
|
(2,868,135)
|
Net
loss
|
(10,717,717)
|
|
(10,866,596)
|
|
(21,548,585)
|
|
(19,724,876)
|
Net loss attributable
to non-controlling interest
|
6,443
|
|
14,008
|
|
15,851
|
|
28,168
|
Net loss
attributable to Inovio Pharmaceuticals, Inc.
|
$
|
(10,711,274)
|
|
$
|
(10,852,588)
|
|
$
|
(21,532,734)
|
|
$
|
(19,696,708)
|
Net loss per
common share attributable to Inovio Pharmaceuticals, Inc.
stockholders:
|
|
|
|
|
|
|
|
Basic
|
$
|
(0.18)
|
|
$
|
(0.24)
|
|
$
|
(0.37)
|
|
$
|
(0.47)
|
Diluted
|
$
|
(0.19)
|
|
$
|
(0.24)
|
|
$
|
(0.38)
|
|
$
|
(0.47)
|
Weighted average
number of common shares outstanding used in per share
calculations:
|
|
|
|
|
|
|
|
Basic
|
60,232,498
|
|
44,988,704
|
|
57,722,938
|
|
42,046,829
|
Diluted
|
60,474,859
|
|
44,988,704
|
|
57,976,455
|
|
42,046,829
|
|
|
|
|
|
|
|
|
CONTACTS:
|
|
Investors:
|
Bernie Hertel, Inovio
Pharmaceuticals, 858-410-3101, bhertel@inovio.com
|
Media:
|
Jeff Richardson,
Inovio Pharmaceuticals, 267-440-4211,
jrichardson@inovio.com
|
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SOURCE Inovio Pharmaceuticals, Inc.