Inovio Pharmaceuticals, Inc. (NASDAQ:INO) today reported financial
results for the fourth quarter and year ended December 31, 2015.
Total revenue was $5.9 million and $40.6 million
for the quarter and year ended December 31, 2015, as compared to
$2.5 million and $10.5 million for the same periods in 2014.
Total operating expenses for the quarter and
year ended December 31, 2015, were $20.5 million and $74.9 million
as compared to $13.5 million and $50.0 million for the same periods
in 2014.
The net loss attributable to common stockholders
for the quarter and year ended December 31, 2015, was $18.0
million, or $0.25 per share, and $29.2 million, or $0.43 per share,
as compared with a net loss attributable to common stockholders of
$7.4 million or $0.12 per share, and $36.1 million, or $0.61 per
share, for the quarter and year ended December 31, 2014.
Revenue
The increase in revenue for the annual period
was primarily due to development payments from our DARPA Ebola
grant as well as $16.0 million of revenue recognized in 2015 from
the up-front payment received from our partnership agreement with
MedImmune. Accounting recognition of the remainder of the $27.5
million upfront payment has been deferred and will be triggered by
future events associated with the development of products per the
agreement.
Operating Expenses
Research and development expenses for the
quarter and year ended December 31, 2015, were $15.6 million and
$57.8 million as compared to $9.2 million and $34.1 million for the
same periods in 2014. The increase in R&D expenses is generally
related to an increased investment in all our product development
programs. General and administrative expenses for the quarter and
year ended December 31, 2015, were $4.9 million and $18.1 million,
compared to $4.2 million and $15.9 million for the quarter and year
ended December 31, 2014.
Capital Resources
As of December 31, 2015, cash and cash
equivalents and short-term investments were $163.0 million compared
with $93.6 million as of December 31, 2014. As of
December 31, 2015, the company had 72.2 million shares outstanding
and 78.9 million fully diluted.
Inovio’s balance sheet and statement of
operations are provided below. Form 10-K providing the complete
2015 annual financial report can be found at:
http://ir.inovio.com/secfilings.
Corporate Update
Corporate Development
In August 2015, Inovio entered into a strategic
cancer vaccine collaboration and license agreement with MedImmune,
the global biologics research and development arm of AstraZeneca.
MedImmune acquired exclusive rights to Inovio’s INO-3112
immunotherapy, which targets cancers caused by human papillomavirus
(HPV) types 16 and 18. MedImmune intends to study INO-3112 in
combination with selected immunotherapy molecules within its
pipeline in HPV-driven cancers. Emerging evidence suggests that the
benefits from immuno-oncology molecules, such as those in
MedImmune’s portfolio, can be enhanced when they are used in
combination with cancer vaccines that generate significant levels
of tumor-specific T-cells. We plan to initiate a combination study
in humans in 2016.
MedImmune paid Inovio $27.5 million in the third
quarter and will fund all development costs and make potential
future payments totaling up to $700 million upon reaching
development and commercial milestones. Inovio is entitled to
receive up to double-digit tiered royalties on INO-3112 product
sales.
Inovio and MedImmune will also develop up to two
additional DNA-based cancer vaccine products not included in
Inovio's current product pipeline, which MedImmune will have the
exclusive rights to develop and commercialize. Inovio will be
eligible to receive development, regulatory and commercialization
milestone payments and royalties on net sales for these cancer
vaccines.
This is Inovio’s second major partnership with a
large pharmaceutical company, adding to its existing license
agreement with Roche for Inovio’s INO-1800 hepatitis B
immunotherapy. The initiation of a phase I trial for INO-1800 in
April 2015 triggered a $3 million milestone payment from Roche.
During the year we announced a collaboration
with the European Organization for Research and Treatment of Cancer
to evaluate INO-3112 in combination with traditional
chemo-radiotherapy for the treatment of patients with locally
advanced stage cervical cancer. It is expected to begin in 2016 and
will be part of MedImmune’s development plan. We also
announced a $45 million award from the Defense Advanced Research
Projects Agency (DARPA) to advance treatment and prevention
approaches against Ebola and a five-year $16 million Integrated
Preclinical/Clinical AIDS Vaccine Development Program from the
National Institute of Allergy and Infectious Diseases to expand the
coverage of our PENNVAX®-GP immunotherapy to additional HIV strains
and advance new technologies to further improve vaccination
outcomes. This grant follows a previous $25 million award used to
develop PENNVAX®-GP.
In January 2016 we announced a $500,000 grant
from the U.S. Army’s Small Business Innovation Research (SBIR)
program to further develop our next generation delivery device
capable of simultaneously administering multiple vaccines via
skin-surface, needle-free electroporation.
Clinical Development
Inovio’s manuscript detailing the broad findings
of its phase II study of VGX-3100 in patients with high-grade
cervical dysplasia (CIN 2/3) was published in The Lancet, a top
peer-reviewed medical journal. This publication describes that
VGX-3100 is the first therapy to demonstrate that activated killer
T cells induced in the body can clear neoplastic lesions as well as
the virus which caused the disease. These findings show the
clinical relevance not only for this disease indication but for the
broad utility of Inovio’s technology across cancers and infectious
diseases.
Inovio is preparing to initiate a phase III
study of VGX-3100 in mid-2016. The company expects its
end-of-phase-II meeting with the FDA, which will review Inovio’s
phase II data and proposed phase III clinical trial design, to take
place in the 2Q 2016.
As part of our broad franchise targeting
HPV-associated precancers and cancers, we reported preliminary data
from our phase I head & neck cancer trial showing that INO-3112
(VGX-3100 plus Inovio’s IL-12 based immune activator) generated
robust HPV16/18 specific CD8+ T cell responses and antibodies
against HPV16/18 in 10 of 10 tested patients who received all
treatments. The characteristics of these immune response data
mirror those previously observed in the phase II study of VGX-3100
for HPV-associated cervical dysplasia.
We initiated with our partner Roche a phase I
trial for our hepatitis B immunotherapy, INO-1800. This randomized,
open-label, active-controlled, dose escalation study is evaluating
the safety, tolerability, and immunogenicity of Inovio's hepatitis
B immunotherapy alone or in combination with Inovio's IL-12-based
immune activator.
Inovio launched a phase I study of INO-5150, its
SynCon® immunotherapy targeting prostate-specific membrane antigen
and prostate-specific antigen, in men with biochemically relapsed
prostate cancer. This study is evaluating the safety, tolerability,
and immunogenicity of INO-5150 alone or in combination with
Inovio’s DNA-based IL-12 immune activator. The company expects to
report interim data from this study in 2016.
Inovio continues to enroll subjects in its phase
I trial of its hTERT DNA immunotherapy (INO-1400) alone or in
combination with Inovio’s IL-12 immune activator (INO-9012) in
adults with breast, lung, or pancreatic cancer. High levels of
hTERT (human telomerase reverse transcriptase) expression are found
in 85% of human cancers. The primary objective of this study is to
evaluate the safety, tolerability, and immune responses. The
company expects to report interim data from this study in 2016.
With collaborators under our DARPA-funded
project we completed enrollment of 75 healthy subjects in a phase I
study of our Ebola immunotherapy, INO-4212. We expect to report
this data in 2016. Inovio published data in 2013 showing 100%
protection of animals immunized with this product.
Molecular Therapy published data from a
12-patient phase I study showing that our single-clade PENNVAX®-B
HIV immunotherapy induced in HIV-infected patients CD8+ T cells
with functional characteristics similar to those of long-term
non-progressors (rare HIV-infected individuals who, without
treatment, do not progress to further stages of the disease). This
product provided the foundation for the design of our global,
multi-clade PENNVAX®-GP preventive and therapeutic HIV DNA
immunotherapy.
In September 2015 the first patient was dosed in
a phase I trial evaluating immune responses, safety and
tolerability of PENNVAX®-GP with and without an immune activator
(DNA IL-12) in healthy subjects. This study is being conducted by
the HIV Vaccines Trial Network (HVTN) and is funded by the National
Institute of Allergy and Infectious Diseases (NIAID).
In January 2016 the Walter Reed Army Institute
of Research began enrolling healthy subjects in a phase I study of
Inovio’s DNA vaccine (GLS-5300) for Middle East Respiratory
Syndrome (MERS). This program is being advanced in collaboration
with GeneOne Life Science Inc.
In January 2016 Inovio and its collaborator
announced that its Zika virus vaccine (GLS-5700) induced robust and
durable immune responses in mice. The company will next test the
immunotherapy in non-human primates and initiate clinical product
manufacturing with the goal of starting a phase I study in humans
with its collaborator, GeneOne Life Science, by year end.
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. The company is advancing a growing
clinical and preclinical stage product pipeline. Partners and
collaborators include MedImmune, Roche, University of Pennsylvania,
DARPA, GeneOne Life Science, Drexel University, 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, our expectations regarding our
research and development programs 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 and INO-3112, 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, our ability to advance our portfolio of immune-oncology
products independently, 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, our ability to enter into
partnerships in conjunction with our research and development
programs, 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, 2015,
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. |
CONSOLIDATED
BALANCE SHEETS |
|
|
December 31, |
|
2015 |
|
2014 |
ASSETS |
|
|
|
Current
assets: |
|
|
|
Cash and cash
equivalents |
$ |
57,632,693 |
|
|
$ |
40,543,982 |
|
Short-term
investments |
105,357,277 |
|
|
53,075,974 |
|
Accounts receivable |
7,333,059 |
|
|
2,804,207 |
|
Prepaid expenses and other
current assets |
917,257 |
|
|
797,973 |
|
Prepaid expenses from
affiliated entity |
610,652 |
|
|
1,382,375 |
|
Deferred tax asset |
— |
|
|
342,573 |
|
Total current
assets |
171,850,938 |
|
|
98,947,084 |
|
Fixed assets, net |
7,306,695 |
|
|
4,583,204 |
|
Investment in affiliated
entity - GeneOne |
14,941,277 |
|
|
12,340,811 |
|
Investment in affiliated
entity - PLS |
5,045,915 |
|
|
— |
|
Intangible assets,
net |
3,905,860 |
|
|
4,776,059 |
|
Goodwill |
10,113,371 |
|
|
10,113,371 |
|
Common stock warrants |
5,970 |
|
|
550,000 |
|
Other assets |
670,833 |
|
|
474,568 |
|
Total
assets |
$ |
213,840,859 |
|
|
$ |
131,785,097 |
|
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
Current
liabilities: |
|
|
|
Accounts payable and
accrued expenses |
$ |
13,064,899 |
|
|
$ |
6,383,170 |
|
Accounts payable and
accrued expenses due to affiliated entity |
165,047 |
|
|
28,407 |
|
Accrued clinical trial
expenses |
2,600,483 |
|
|
2,007,432 |
|
Common stock warrants |
1,301,138 |
|
|
2,022,729 |
|
Deferred revenue |
13,449,768 |
|
|
3,187,223 |
|
Deferred revenue from
affiliated entity |
504,442 |
|
|
394,791 |
|
Deferred rent |
380,629 |
|
|
61,542 |
|
Total current
liabilities |
31,466,406 |
|
|
14,085,294 |
|
Deferred revenue, net of
current portion |
103,074 |
|
|
173,779 |
|
Deferred revenue from
affiliated entity, net of current portion |
677,371 |
|
|
836,694 |
|
Deferred rent, net of
current portion |
5,485,313 |
|
|
4,647,687 |
|
Deferred tax
liabilities |
175,642 |
|
|
504,049 |
|
Total
liabilities |
37,907,806 |
|
|
20,247,503 |
|
Commitments and
contingencies |
|
|
|
Inovio
Pharmaceuticals, Inc. stockholders’ equity: |
|
|
|
Preferred stock—par value
$0.001; Authorized shares: 10,000,000, issued and outstanding
shares: 23 at December 31, 2015 and December 31,
2014 |
— |
|
|
— |
|
Common stock—par value
$0.001; Authorized shares: 600,000,000 at December 31, 2015 and
December 31, 2014, issued and outstanding: 72,217,965 at
December 31, 2015 and 60,741,082 at December 31,
2014 |
72,218 |
|
|
60,741 |
|
Additional paid-in
capital |
534,004,564 |
|
|
443,327,915 |
|
Accumulated deficit |
(361,097,896 |
) |
|
(331,910,290 |
) |
Accumulated other
comprehensive income (loss) |
2,708,339 |
|
|
(251,390 |
) |
Total Inovio
Pharmaceuticals, Inc. stockholders’ equity |
175,687,225 |
|
|
111,226,976 |
|
Non-controlling
interest |
245,828 |
|
|
310,618 |
|
Total stockholders’
equity |
175,933,053 |
|
|
111,537,594 |
|
Total liabilities
and stockholders’ equity |
$ |
213,840,859 |
|
|
$ |
131,785,097 |
|
|
Inovio
Pharmaceuticals, Inc. |
CONSOLIDATED
STATEMENTS OF OPERATIONS |
|
|
For the Year ended
December 31, |
|
2015 |
|
2014 |
|
2013 |
Revenues: |
|
|
|
|
|
Revenue under
collaborative research and development arrangements |
$ |
26,876,533 |
|
|
$ |
7,416,568 |
|
|
$ |
9,239,547 |
|
Revenue under
collaborative research and development arrangements with affiliated
entity |
779,167 |
|
|
479,464 |
|
|
425,000 |
|
Grants and miscellaneous
revenue |
12,916,411 |
|
|
2,560,734 |
|
|
3,802,799 |
|
Total
revenues |
40,572,111 |
|
|
10,456,766 |
|
|
13,467,346 |
|
Operating
expenses: |
|
|
|
|
|
Research and
development |
57,791,923 |
|
|
34,095,039 |
|
|
21,368,604 |
|
General and
administrative |
18,063,890 |
|
|
15,857,688 |
|
|
13,643,074 |
|
Gain on sale of
assets |
(1,000,000 |
) |
|
— |
|
|
(2,000,000 |
) |
Total operating
expenses |
74,855,813 |
|
|
49,952,727 |
|
|
33,011,678 |
|
Loss from
operations |
(34,283,702 |
) |
|
(39,495,961 |
) |
|
(19,544,332 |
) |
Other income
(expense): |
|
|
|
|
|
Interest and other income,
net |
305,071 |
|
|
331,461 |
|
|
132,214 |
|
Change in fair value of
common stock warrants |
177,561 |
|
|
348,143 |
|
|
(45,632,669 |
) |
Gain (Loss) on investment
in affiliated entity |
2,600,467 |
|
|
2,676,224 |
|
|
(1,038,745 |
) |
Net loss before
income tax benefit |
(31,200,603 |
) |
|
(36,140,133 |
) |
|
(66,083,532 |
) |
Income tax benefit |
2,097,766 |
|
|
— |
|
|
— |
|
Net
loss |
(29,102,837 |
) |
|
(36,140,133 |
) |
|
(66,083,532 |
) |
Net (income) loss
attributable to non-controlling interest |
(84,769 |
) |
|
18,420 |
|
|
55,084 |
|
Net loss
attributable to Inovio Pharmaceuticals, Inc. |
$ |
(29,187,606 |
) |
|
$ |
(36,121,713 |
) |
|
$ |
(66,028,448 |
) |
Net loss per
common share attributable to Inovio Pharmaceuticals, Inc.
stockholders |
|
|
|
|
|
Basic |
$ |
(0.43 |
) |
|
$ |
(0.61 |
) |
|
$ |
(1.43 |
) |
Diluted |
$ |
(0.44 |
) |
|
$ |
(0.64 |
) |
|
$ |
(1.43 |
) |
Weighted average
number of common shares outstanding used in per share
calculations: |
|
|
|
|
|
Basic |
68,198,142 |
|
|
59,127,349 |
|
|
46,087,773 |
|
Diluted |
68,365,265 |
|
|
59,408,252 |
|
|
46,087,773 |
|
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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