Inovio Pharmaceuticals, Inc. (NASDAQ:INO) reported a loss of 26 cents per share in the second quarter of 2016, in line with the Zacks Consensus Estimate but wider than the year-ago loss of 9 cents.
Total revenue in the quarter was up almost 17% to $6.2 million, reflecting higher development payments from the Defense Advanced Research Projects Agency as Ebola grant. Revenues were also above the Zacks Consensus Estimate of $4.4 million.
In the second quarter of 2016, research and development expenses increased 17.4% year over year to $19.6 million due to increased pipeline investment. General and administrative expenses also rose 23.4% to $5.8 million.
Pipeline Update
Inovio continues to progress with its pipeline. Following the successful end-of-phase-II meeting with the FDA as well as the European Medicines Agency, the company now plans to commence a pivotal phase III registration study on VGX-3100 for the treatment of HPV-16/18-related high-grade cervical dysplasia in the fourth quarter of 2016.
The company is also working on the development of other candidates. Currently, it is evaluating INO-5150 (phase I) for the treatment of prostate cancer and INO-3112 (phase I) for HPV-related cervical, head and neck cancers. Interim immune response data from both studies are expected in the fourth quarter of 2016.
Inovio, along with AstraZeneca plc's (NYSE:AZN) global biologics research & development arm MedImmune, expects to begin combination studies on INO-3112 around the end of 2016.
Inovio is also working on developing vaccines for Ebola, Zika and Middle East Respiratory Syndrome (MERS).
In Jul 2016, a phase I study was initiated to evaluate the company’s Zika DNA vaccine (GLS-5700) in healthy subjects. Interim data from the study are expected in the fourth quarter.
Meanwhile, the company is evaluating the MERS vaccine (GLS-5300) in a phase I study and expects to report interim data in the fourth quarter.
Our Take
Inovio’s second-quarter results were encouraging with the company’s loss meeting estimates and revenues beating the same. We are also pleased with the company’s efforts to initiate a late-stage study on its lead candidate, VGX-3100. The company’s efforts in developing vaccines for Ebola, MERS and Zika virus are encouraging as well.
Going ahead, the company expects further development of its oncology and infectious disease candidates in 2016. We expect investor focus to remain on pipeline updates by the company.
Inovio carries a Zacks Rank #3 (Hold). A couple of better-ranked stocks in the health care sector are Ligand Pharmaceuticals Incorporated (NASDAQ:LGND) and Corcept Therapeutics Incorporated (NASDAQ:CORT) . Both stocks sport a Zacks Rank #1 (Strong Buy).
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