PLYMOUTH MEETING, PA – March 14, 2016 – 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.
CONTACTS:
Investors: Bernie Hertel, Inovio Pharmaceuticals, 858-410-3101, bhertel@inovio.com
Media: Jeff Richardson, Inovio Pharmaceuticals, 267-440-4211, jrichardson@inovio.com
