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Has the Clock Struck Midnight for This Cinderella Coronavirus Stock?

·2 min read

Good things come to those who wait but might they have come too late for coronavirus vaccine maker Inovio Pharmaceuticals (INO)?

Inovio has finally been granted approval from the FDA to proceed with the Phase 2 portion of the Phase 2/3 trial for its COVID-19 DNA vaccine candidate INO-4800. To recap: Inovio was about to initiate the study in September only to be stopped in its tracks by the FDA. The regulatory body said it required additional information on INO-4800 and the company’s CELLECTRA 2000 delivery device before allowing the study to go ahead.

The FDA hasn’t signed off on the Phase 3 portion yet and will only do so once Inovio answers the FDA’s questions regarding the Cellectra 2000 device. The device is meant be used for the delivery of INO-4800 into the skin. Inovio expects to address the issues during the Phase 2 trial.

The U.S. trial will include 400 patients and is funded by the U.S. Department of Defense (DoD).

Even before the recent announcements from Pfizer/BioNTech and Moderna’s positive interim data for their respective Covid-19 vaccine candidates, Inovio was far behind its competitors’ programs’ development. Nevertheless, H.C. Wainwright analyst Ram Selvaraju points out the “duration of their efficacy and their long-term safety profiles remain to be seen.” Additionally, the 5-star analyst reminds investors of INO-4800’s unique properties.

“INO-4800's key differentiators include its excellent thermostability profile (stable at room temperature for more than a year), making it possible to manufacture at scale and transport without frozen cold chain requirements,” Selvaraju said. “In contrast, the mRNA-based vaccines need to be stored at extremely low temperatures—Pfizer and BioNTech's candidate, for example, requires storage at -94ºF (-70ºC)—and therefore could be challenging to distribute and deploy on a broad basis.”

Selvaraju anticipates Inovio will announce the trial’s data in 2H21, but for now sticks to a Neutral (i.e. Hold) rating. Due to “market valuation and volatility,” the analyst has no fixed price target. (To watch Selvaraju’s track record, click here)

Overall, the rest of the Street is on the same page. Based on 2 Buys, 5 holds and 1 Sell, the stock has a Hold consensus rating. Given the $13.71 average price target, the analysts expect shares to gain 24% over the next 12 months. (See Inovio stock analysis on TipRanks)

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Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.