An Evaluation of Biotech Firms Part 4

A Comprehensive Essay 

Part 4

Our fair evaluation approaches of biotechnology and biopharma companies differ depending on the sizes and statuses of the firms. We reiterate our conviction that causing a selloff of development stage biotech stocks at every announcement of quarterly financial results because of lack of income is irrelevant and unfair to the firms and their stockholders. It does not make sense that analysts ask for better incomes when most of these firms have yet to put a product on the market, their only way to generate revenues.    

We have stated that the most important criteria we try to use first in our evaluation are the companies’ scientific fundamentals, their management capabilities, their proprietary technologies and the promises of their pipeline products. These, in our opinion, is what constitutes the backbone of drug companies, including biotech and biopharmaceutical firms.  

We do not sell firms we like because their stocks have underperformed in the past 50 days or so. We sell only when devastating bad news increases the firms’ debts while tremendously depleting their cash.   

In part one, two and three of these essays we selected cases in point that demonstrated various conditions where irrelevant selloffs of biotech stocks following negative news could be the key that brings wealth to savvy investors who instead of joining the sellers they take advantage of the prices decline to buy or accumulate them at bargain prices.

Our case in point today is Inovio Pharmaceuticals (INO) which just started Phase 1 human clinical trials of its novel DNA vaccine against COVID-19. Inovio planned to enroll around 40 healthy adult volunteers at the Perelman School of Medicine at the University of Philadelphia in PA and at the Center for Pharmaceutical Research in Kansas City, MO.

Inovio Pharmaceuticals

Inovio Pharmaceuticals is a biotechnology company focused on designing DNA medicines to treat, cure and protect people from HPV, cancer and infectious diseases.

Inovio is the first to demonstrate that DNA medicine can be delivered directly into cells in the body via a proprietary smart device to produce a robust and tolerable immune response.

VGX-3100, currently in Phase 3 trials for precancerous cervical dysplasia, destroyed and cleared high-risk HPV 16 and 18 in a Phase 2b clinical trial.

High-risk HPV is responsible for 70% of cervical cancer, 90% of anal cancer and 69% of vulvar cancer.

Inovio Pharmaceuticals Has Other Products That Target the Following Diseases:

HPV-related cancers,

A rare HPV-related disease,

Recurrent respiratory papillomatosis (RRP),

Non-HPV-related cancers which include: Glioblastoma multiforme (GBM) and prostate cancer,

Infectious Visease DNA vaccine Development Programs for the Following:

Zika, Lassa fever, Ebola, HIV, and coronaviruses associated with MERS and COVID-19

Inovio Pharmaceuticals Collaborators Are:

Plumbline Life Sciences, Regeneron, Roche, Advaccine, ApolloBio Corporation, AstraZeneca, The Bill & Melinda Gates Foundation, Coalition for Epidemic Preparedness Innovations (CEPI), Defense Advanced Research Projects Agency (DARPA) National Cancer Institute, National Institutes of Health, National Institute of Allergy and Infectious Diseases, Ology Bioservices, University of Pennsylvania, Walter Reed Army Institute of Research and The Wistar Institute.

Inovio in the NEWS

Last week The United States Food and Drug Administration (FDA) accepted Inovio’s Investigational New Drug (IND) application of its DNA vaccine INO-4800 designed to prevent COVID-19 infection.

We consider the FDA decision a big deal and we decided to follow up on the novel coronavirus vaccine clinical trial results and Inovio’s future products’ achievements and clinical trial results.

Why Our Enthusiasm?

The fact that Inovio’s vaccine is a DNA medicine is a big deal. The vaccine is composed of optimized DNA plasmids – small circles of double-stranded DNA that are synthesized or reorganized by a computer sequencing technology and designed to produce a specific immune response in the body.

The firm’s DNA medicines deliver optimized plasmids directly into cells intramuscularly or intradermally. That capability was achieved through the use of the firm’s proprietary hand-held smart device called CELLECTRA® which uses a brief electrical pulse to open small pores in the cell reversibly to allow the plasmids to enter. Once inside the cell the plasmids are used by the cell’s own machinery to generate specific coded antigens which then stimulate an immune response.

That is inspiring. We were also impressed by the high speed of the screening of trial participants and by the fast arrival of the vaccine supply. Furthermore we are impressed by the preclinical data that were submitted to the FDA as part of the IND. These data had demonstrated promising immune response results across multiple animal models.

Preplanning

We appreciate that Inovio informed the shareholders upon attaining initial safety and immunogenicity data from Phase 1 studies. Inovio intends to advance INO-4800 to Phase 2 efficacy studies as rapidly as possible. Without planning and preparing Inovio would not have been able to manufacture thousands of INO-4800 doses in 10 weeks which it has accomplished in order to support on-going Phase 1 and planned Phase 2 clinical trials. In parallel Inovio plans to have one million doses of the vaccine available by year-end for additional trials and emergency use, pending appropriate regulatory guidance and funding.

What Else Motivates Us to Follow-Up on Inovio

  • We agree with Inovio President Dr. J. Joseph Kim that without a new safe and effective vaccine the COVID-19 pandemic is likely to continue to threaten lives and livelihoods.
  • Inovio’s DNA vaccine platform was one of the first technologies selected by CEPI to develop a vaccine candidate against COVID-19. Moderna (MRNA) was also selected by CEPI.   
  • Results showing a successful previous Study with Another DNA vaccine on Middle East Respiratory Syndrome (MERS).
  • Inovio’s Phase 1 vaccine INO-4700 study for MERS, also caused by a coronavirus, was well tolerated and induced high levels of antibody responses in 95% of subjects. The vaccine generated broad-based T cell responses in nearly 90% of study participants.
  • Durable antibody responses to its DNA vaccine used in that trial were maintained through 60 weeks following dosing. This is a proof of concept that Inovio has offered for its DNA Vaccines, which we consider very important to have.    

Competition

Prohost believes that protecting the world from pandemic infections will require many vaccines, probably 10. The idea of leaving some countries vulnerable to life-threatening infections is not an option. One company alone cannot manufacture a vaccine to be administered to the billions of people living on our planet. 

Dr. David B. Weiner, Director of the Wistar Institute’s Vaccine and Immunotherapy Center and Executive Vice President of the Institute said, “Inovio’s leadership and the team’s experience combined with the consistency of this DNA technology for clinical translation continue to be a major asset for the program…”

We agree.

Inovio Pharmaceuticals Stock

The Symbol INO
Stock Price $7.70
Market Cap. $1.12 billion
52-Week High $19.36
52-Week Low $1.92

Biotech Firms Developing Products and Vaccines Against Coronavirus  

Gilead (GILD) A treatment has good news.
Moderna (MRNA) A vaccine against COVID-19 is the first to reach human trial.
Inovio (INO) A vaccine against COVID-19 is in clinical trial.
Novavax (NVAX) We are following up on this firm’s advancement.
Vir Biotechnology (VIR) We will follow up on this firm’s accomplishments.

 To read more about these firms please use the search engine at our website.

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