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With Potential Vaccines for Cancer, Ebola and Zika, Inovio Could Have an Explosive 2016 INO

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Charles Duncan Recent news from Inovio Pharmaceuticals Inc., a small-cap biotech developing immunotherapeutic vaccines that target cancer and infectious diseases like news-making viruses Ebola and Zika, has prompted Piper Jaffray analyst Charles Duncan to reiterate his thesis for investment in the company.

In a note published May 9, Duncan noted the company, which is planning a pivotal trial for its cervical dysplasia vaccine, VGX-3100, has enough cash in the coffers to fund its "broadening pipeline" through the end of 2017.

Duncan's assessment follows Inovio's release of Q1/16 earnings, in which the company reported "$8.1 million ($8.1M) in total revenues and $146.8M of cash and equivalents."

The "most impactful share driver" in the near term, Duncan wrote, is initiation of the pivotal Phase 3 trial for VGX-3100. The Phase 3, following on the heels of meetings with the FDA and the European Medicines Agency (EMA), is expected to be "consistently designed with [the company's] successful Phase 2 study."

Company documents note that in Phase 2, VGX-3100 demonstrated an ability to reduce "high-grade cervical dysplasia"—abnormal or precancerous cells on the cervix caused by certain strains of human papillomavirus (HPV)—to disease that is low grade or is undetectable.

Duncan expects enrollment of up to 400 patients in 25 countries in the Phase 3 trial. In a previous note, the analyst noted the company "is ready to produce commercial-grade product"; in addition, the "proprietary" Cellectra 5PSP electroporation device that will deliver the vaccine, called a "key differentiator," will be employed.

The company also has a cervical cancer immunotherapy, INO-3112, partnered with MedImmune, which Duncan expects will enter Phase 2 by year-end 2016. INO-1400, in Phase 1 for breast, lung and pancreatic cancer, is also expected to report "interim immune response data" by year-end.

Other 2016 catalysts for the company, which Duncan has rated overweight, include updates from Phase 1 trials of its Ebola and MERS vaccines, "which are crucial data to advance Inovio's diverse infectious disease platform and could provide read-through to advance the Zika trial start." In an earlier note, Duncan noted that Phase 1 data from the Ebola vaccine, expected in H1/16, could "spur additional funding" via a grant Inovio has with the Defense Advanced Research Projects Agency (DARPA). If the data supports positive preclinical results, Duncan noted in March, this "would enhance our confidence in the viral disease pipeline."

Dr. Charles Duncan is a managing director and senior research analyst at Piper Jaffray & Co. focusing on small- and mid-cap emerging growth biotechnology companies. Duncan brings more than 18 years of sellside experience and has been recognized by industry sources, including the StarMine Analyst Awards, as being among the best analysts for his fundamental and timely analysis. He is a graduate of the University of Wisconsin and holds a doctorate in neuropharmacology from the University of Colorado.

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1) Tracy Salcedo compiled this article for Streetwise Reports LLC and provides services to Streetwise Reports as an employee. She owns, or her family owns, shares of the following companies mentioned in this interview: None.
2) Inovio Pharmaceuticals Inc. is a sponsor of Streetwise Reports. The companies mentioned in this interview were not involved in any aspect of the interview preparation or post-interview editing so the expert could speak independently about the sector. Streetwise Reports does not accept stock in exchange for its services. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security.
3) Charles Duncan: I or a household member has a financial interest in the securities of the following companies: None. I or a household member is an officer, director, or advisory board member of the following companies: None. I have received compensation within the past 12 months from the following companies: None. Piper Jaffray has received compensation for investment banking services from or has had a client relationship with the following companies within the past 12 months: Inovio Pharmaceuticals Inc. Piper Jaffray makes a market in the securities of the following companies, and will buy and sell the securities of these companies on a principal basis: Inovio Pharmaceuticals Inc. I had the opportunity to review the article for accuracy as of the date of the article. I was not paid by Streetwise Reports for this article. Streetwise Reports was not paid by the author to publish or syndicate this article.
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