Conference date: August 11, 2014 @ 6:00 AM Pacific Time
for quarter ending: June 30, 2014 (Q2, second quarter 2014)
Overview: Inovio is a development stage company. Today it announced plans to advance to its first Phase 3 trial.
Basic data (GAAP):
Revenue was $3.8 million, up sequentially from $2.4 million, and up from $0.8 million in the year-earlier quarter.
Net income was negative $10.7 million , improved slightly sequentially from negative $10.8 million, and up from negative $10.9 million year-earlier.
EPS (earnings per share, diluted) was negative $0.19, improved sequentially from negative $0.20, and up from negative $0.24 year-earlier. (accounting for 4 to 1 reverse stock split.)
During the quarter announced positive Phase II data for VGX-3100 for HPV induced cervical precancers (neoplasias). HPV causes a variety of other cancer types that VGX-3100 or a similar Inovio vaccine may address. Expects and end of Phase II meeting with the FDA in 2015 and first patient in 2016. A phase III program could cost approximately $100 million. Plans to advance the vaccine independently, but is open to partners for the overall franchise.
R&D expense was $9.6 million. General and administrative expense was $4.3 million. Total operating expenses were $14.0 million. Inovio reported a a negative $10.2 million operating profit. Other expense including change in stock warrant value and loss on an investment were $0.6 million.
Cash and equivalents balance (including short-term investments) ended at $108.8 million, down sequentially from $116.8 million. Liability in common stock warrants $3.1 million.
A Phase I trial of INO-5150 for prostate cancer is planned to initiate in Q3 partnering with Roche. The launch will trigger a milestone payment from Roche. The entire Roche deal has a potential $400 million in milestone payments. Changed the intent-to-treat population to castrate-resistant prostate cancer. The study also will add more antigens as well as checkpoint inhibitors, so study is delayed until 2015.
In Q4 a Phase I study of Pennvax-GP for HIV is expected to begin.
Also planned are exploratory studies for INO-1400, hTERT DNA immunotherapy for breast, lung, and pancreatic cancers.
Strong T-cell responses generated by Inovio vaccines could show the potential for combination with other therapies including immune checkpoint inhibitors.
Inovio also has a variety of vaccines in preclinical study. See the Inovio Pipeline for an overview.
Management believes cash is sufficient to operate the company through the end of 2017. Payments from Roche from have gone up, but will need to raise capital to fund the VGX-3100 program.
During the quarter Inovio completed a reverse-stock-split, 4 for 1.
During the quarter Inovio sold its 91% owned VGX Animal Health to Plumbline Life Sciences of Korea. VGX will receive $2 million in cash and 20% of the shares of Plumbline.
VGX results? Reduction of disease was impressive. Cannot release full data until it is peer reviewed and published. Many women had their HPV infection cleared. T-cell responses were quite impressive as well. For the Phase III trial we want to get to approval as soon as possible while establishing a beachhead to get to the broader HPV cancer related market. We are already taking steps to scale up for the Phase III studies.
The biggest factor in the timeline is the timing of the meeting with the FDA, which in turn depends on how complete the data and analysis has to be to begin discussions. The 2015/2016 timeline is conservative.
Full set of data should appear in a top medical journal as well as in a clinical conference later this year or early next year. We continue to follow the patients, so data comes in from that as well.
Regression linked to HPV titres on a per patient basis? That will be in the future presentations, but the overall answer is yes. The hypothesis is that the immune system can be used to get rid of the cancer and the virus. The data set will have far reaching implications.
Placebo rate, difference from expectations? In literature it was from 5% to 40%, all over the place. We guessed 25% when we designed the study. The actual rate was 30%. That is why you do controlled, double-blinded study. We are thankful our design was able to show the differential in clearance rates. When you combine both regression and clearance, the placebo group drops down to around 15% clearance.
Prostate cancer program, chemo naive population? We are looking at various populations, and in various combinations with checkpoint inhibitors. It will be a larger Phase 1a/1b program. A delay in the beginning may allow us to leapfrog the timeline.
We are working with Roche to create new prostate cancer antigens based on our SynCon system.
IL-12 has been added in the cancer program because cancer cells are harder to tackle. VGX-3000 is sufficient for neoplasias. The T-cell targets the cancer cell, then you also hit them with the checkpoint inhibitors, you can kill the cancer with the immune system. We are changing the current paradigm for treating cancer patients.
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