Key summary on up-coming FDA decision
The COVID-19 vaccine industry has been on edge recently as AstraZeneca and Johnson & Johnson have placed their trials on hold. Following the announcement from the FDA, the INO stock price took a substantial hit. The main concern for INO investors was that the stock price had initially priced-in for the expectation that Phase 2 trials would begin by the end of September. The stock gained momentum mid-way through September as CEO & President Dr. Joseph Kim announced at the H.C Wainwright 22nd Annual Investment Conference that Phase 2 trials were on track to begin by the end of September.
Investors became confident in the success of the Phase 1 trial data and the hinted potential of Government funding to initiate their Phase 2/3 trials. This confidence has since dispersed with the decision from the FDA ultimately holding INO’s fate in the balance. Without a COVID-19 vaccine in the pipeline, the stock is ultimately worth what it was trading in January this year. However, if the FDA are satisfied with INO’s response the stock will likely surge above the price it was trading mid-way through September (opinion not advice).
“The U.S. Food and Drug Administration (FDA) has notified the company it has additional questions about the company’s planned Phase 2/3 trial of its COVID-19 vaccine candidate INO-4800, including its CELLECTRA® 2000 delivery device to be used in the trial. Until the FDA’s questions have been satisfactorily addressed, INOVIO’s Investigational New Drug Application (IND) for the Phase 2/3 trial is on partial clinical hold. The company is actively working to address the FDA’s questions and plans to respond in October, after which the FDA will have up to 30 days to notify INOVIO of its decision as to whether the trial may proceed.”
What are the positives for INO Bulls?
With a lot of speculation surrounding the future of INO-4800, there are some bullish signs moving forward. These positive signs could send the stock back up to new heights assuming trials can commence in due course.
Phase 1 trials show positive signs
From data released in recent conferences, the Phase 1 human trials showed immunological responses in 100% of the 38 patients. In addition, the Phase 1 non-human primate trials showed strong neuturalising T body immune responses in primates. We can conclude the data once published as a Journal, should reflect the CEO Dr Kim’s confidence in how the drug had performed. Furthermore, the company has confirmed it is not on hold due to any adverse effects. As discussed in the statement, INO continues to prepare for initiation of Phase 2/3 trials.
INOVIO and its partners are continuing to prepare for a planned Phase 2/3 trial of INO-4800. Following resolution of the FDA’s partial clinical hold and subject to the receipt of external funding to conduct the trial.
Thermo Fisher partnership
The Thermo Fisher partnership allows Inovio to manufacture 100 million doses of INO-4800 in 2021. Furthermore, this estimate is expected to multiply in 2022-2023. The partnership will allow for Inovio to scale up their operations once FDA approval is given. The large scale production Thermo Fisher will bring should enable INO to get the doses shipped across the world effectively and timely.
“Thermo Fisher provides an end-to-end solution for manufacturing, labeling, packaging and distribution that we believe will help us to provide hundreds of millions of doses of INO-4800 to the US and the rest of the world.”
Robert J. Juba Jr., INOVIO’s Vice President of Biological Manufacturing and Clinical Supply Management
Analysts suggest upside potential for INO stock
The 12 month price targets from analysts according to NASDAQ data suggest a mean price target of $13.71 with a high end target at $25 and low end target at $8. These forecasts are heavily weighted upon the success or failure of INO-4800. Although the Phase 2/3 trials are on hold, analysts are still suggesting a BUY rating as per the NASDAQ data. The 12 month price targets will shift significantly upon the arrival of the FDA’s decision.
In conclusion, the decision by the FDA will determine how the INO share price will close out for 2020. The clear risk is that the FDA will not approve of INO’s response to their questions/concerns surrounding INO-4800. This would be detrimental to the speculated stock. However, we know as per the priced-in 12 month forecasts from analysts, an FDA approval for Phase 2/3 trials would see INO reach new heights (opinion not advice).
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The information above is not financial advice. Youth Investment Group has no liability for personal financial interests or investment decisions. You should make your own investment decisions based upon your own research and what you believe is best for you.
Written by Tyger Fitzpatrick, Founder.