Stock Update (NASDAQ:INO): Inovio Pharmaceuticals Inc and ApolloBio to Collaborate on Development and Commercialization of VGX-3100 in Greater China


Inovio Pharmaceuticals, Inc. (NASDAQ:INO) announced that it has entered into a collaboration and license agreement providing ApolloBio Corporation (NEEQ:430187) with the exclusive right to develop and commercialize VGX-3100, Inovio’s DNA immunotherapy product designed to treat pre-cancers caused by human papillomavirus (HPV), within Greater China (China, Hong Kong, Macao, Taiwan). The agreement provides for potential inclusion of the Republic of Korea three years following the effective date.

Under the collaboration and license agreement, Inovio will receive $15 million in upfront and near term payments comprising an initial $3 million signing fee and a $12 million milestone upon lifting of the VGX-3100 phase 3 pre-initiation clinical hold by the FDA. Under a separate equity agreement, ApolloBio will invest in Inovio common stock subsequent to lifting of the clinical hold at a volume weighted average price encompassing a trading period prior to and following the lifting of the clinical hold. The aggregate investment, which is expected to be completed in the first half of 2017, will not exceed $35 million and may be a lower amount such that ApolloBio will not be the largest shareholder in Inovio. ApolloBio will fund all clinical development costs within the licensed territory, and will pay Inovio up to $20 million based upon the achievement of certain regulatory milestones in the US, China and Korea, and double digit royalties on net sales of VGX-3100. The agreements are subject to People’s Republic of China (PRC) corporate and regulatory approvals, and payments are subject to PRC currency approvals.

This collaboration on VGX-3100 encompasses the treatment and/or prevention of pre-cancerous HPV infections and HPV-driven dysplasias, and excludes HPV-driven cancers and all combinations of VGX-3100 with other immunostimulants.

Dr. J. Joseph Kim, Inovio’s President and Chief Executive Officer, said, “As Inovio continues to focus on the path to regulatory approvals and commercialization strategies in the U.S. and European countries, this agreement opens up Greater China for our lead program and first phase III product. We believe that ApolloBio is a strong partner that brings significant capabilities and expertise relating to product development, the Chinese regulatory landscape, and the healthcare market in China.”

Dr. Weiping Yang, Chief Executive Officer of ApolloBio Corporation, said, “We are delighted to begin 2017 with a strategic collaboration with Inovio. VGX-3100 is the world’s first therapeutic vaccine being developed for HPV pre-cancers. This collaboration, license and equity investment marks our determination to introduce late stage innovative new drugs to meet severely unmet medical needs within the Greater China region.”

Shares of Inovio closed last Friday at $6.39, down $0.11 or -1.69%. INO has a 1-year high of $11.69 and a 1-year low of $5.85. The stock’s 50-day moving average is $6.71 and its 200-day moving average is $7.93.

On the ratings front, INO has been the subject of a number of recent research reports. In a report issued on December 22, H.C. Wainwright analyst Ram Selvaraju reiterated a Buy rating on INO. Separately, on December 21, Stifel Nicolaus’ Thomas Shrader reiterated a Buy rating on the stock and has a price target of $11.

According to TipRanks.com, which ranks over 7,500 financial analysts and bloggers to gauge the performance of their past recommendations, Ram Selvaraju and Thomas Shrader have a yearly average loss of -3.9% and a return of 6.4% respectively. Selvaraju has a success rate of 38% and is ranked #4197 out of 4428 analysts, while Shrader has a success rate of 35% and is ranked #1265.

Inovio Pharmaceuticals, Inc. is a bio-pharmaceutical company, which develops active DNA immunotherapies for cancer and infectious diseases. Its portfolio of immune therapies includes SynCon immunotherapies and electroporation delivery systems.