Inovio Pharmaceuticals: Smart Devices And A Smart Investment
Jun. 25, 2020 2:09 PM ET | About: Inovio Pharmaceuticals, Inc. (INO)
David M. Eberhart
David M. Eberhart
Long only, Growth, dividend investing
(231 followers)
Summary
Another multi-million dollar award from the U.S. Department of Defense validates Inovio's 21st century DNA technology.
The DoD stake in Inovio's Smart devices signals a "smart" buy for investors.
Inovio Pipeline Update: HPV.
On Tuesday, June 23, 2020, Inovio Pharmaceuticals (INO) announced that it had received a $71 million contract from the U.S. Department of Defense (DoD) to scale up manufacturing of its CELLECTRA 3PSP smart devices, as well as the procurement of CELLECTRA 2000 for Inovio's COVID-19 DNA vaccine, INO-4800. This new award continues to strengthen and ensure the ongoing relationship between the United States Department of Defense and Inovio Pharmaceuticals, a relationship that dates back over the last several years.
Inovio CEO Dr. Joseph Kim added this regarding their upcoming work with the DoD,
We look forward to working closely with DoD, JPEO-CBRND and JPL-CBRND-EB to provide much needed protection to DoD personnel and their families through development of a safe and effective vaccine against COVID-19. This next generation smart device leverages the efficacy delivery and safety track record of an earlier version that has received CE mark certification and has been used in clinical trials to safely dose more than 2,000 patients in over 7,000 administrations of INOVIO's DNA medicines. The current DoD contract further supports INOVIO's large-scale production of devices and arrays to deliver potentially hundreds of millions of doses of INO-4800 next year to combat the global COVID-19 pandemic."
In my last article, "Inovio Pharmaceuticals: Positioning for a Global Opportunity", I wrote about the critical importance of this smart device for the effective delivery of Inovio's DNA vaccines. In essence, I reported that without this device, INO vaccines are essentially worthless and ineffective. Therefore, with the DoD granting an award to scale up manufacturing as well as procurement for these devices, it serves to validate and acknowledge the significance of the marriage between electroporation (EP) for the delivery of Inovio's DNA vaccines.
As a result of the DoD award, INO churned over 172M shares in volume for the day (a bit more than 110% of the entire float of outstanding shares), gained an additional 40% in SP appreciation and raised the market cap to $3.41B.
Source: Tradingview.com
A Smart Decision
So, what makes this investment by the DoD such a smart decision? I'll break this down into small parts so as to not lose the reader in the science of electroporation (EP) in order to illustrate the marriage between (EP) and the introduction of (DNA) into living cells and why the DoD gets it.
1. It all starts with identifying a sequence of the genetic code found in the disease target. Once the identification of a genetic sequence has been selected, the DNA plasmid (usually a circular ring of a harmless fragment of E Coli DNA), is encoded with only that portion of the sequence deemed safest to deliver an optimal response, hence the expression 'optimized DNA plasmid'.
2. After pre-clinical trials on small animals (mice and guinea pigs), challenge studies of infected larger animals such as rabbits, ferrets and primates are initiated and the results analyzed to confirm safety and efficacy, as well as some time to allow for peer reviews, before a vaccine can move into human trials. This can take years however, Inovio has the advantage of years of prior research that make their rapid response platform to infectious diseases attractive to the DoD.
3. Next follows the introduction of measured doses of the pre-clinically tested DNA plasmid into humans. These occur in PHI, PHII and PHIII trials. The introduction of the DNA medicine is done via a common ordinary syringe into the upper layers of the skin.
4. Once injected into the skin via syringe it is followed by electroporation or better stated, a series of pulsed electrical discharges which open up small holes in nearby cells which allow the plasmids to enter cells. The pulses are spaced milliseconds apart and are administered using the 3PSP device, an electric toothbrush sized device (pictured below). The device is an un-tethered, AA" battery operated and uses disposable cartridge tips. It can be used for both intra-dermal (ID) and intra-muscular (IM) delivery.
It's safe because the plasmid is only encoded with a nano piece of the gene sequence, in the case of COVID-19, a part of the spike protein. Once inside the cell, after EP, the DNA plasmids enable the cell to produce the targeted antigen. The antigen is processed naturally in the cell and triggers the desired T cell and antibody-mediated immune response. In lay terms, the body recognizes an unfamiliar visitor and activates the immune system to provide front line protection before the disease can infiltrate and infect a potential host.
For those new to the science, pictured below is an illustration of a circular DNA plasmid (in blue) and the added snippet of an antigen (in green) which depicts the DNA technology that Inovio identifies as "SynCon" or synthetic consensus.
Source: Inovio.com
Armed with all of this knowledge it makes sense for the DoD to capitalize on their partnership with Inovio. Inovio has repeatedly shown a proven safety profile while dosing over 2,000 patients with EP electrical stimulation. Additionally, it has shown to be the most efficient method to effectively permit DNA to pass through the protective membrane walls of living plants, animals and humans, a process known as 'transfection'. Furthermore, the appropriate genetic sequence selection for plasmids used for delivering coded instructions that activates the immune system is part of the Inovio IP portfolio and why INO can design a vaccine in a matter of hours.
As described and detailed above, Inovio has produced an attractive platform for partnership with the DoD in order to protect its military members and their families with a safe and effective vaccine. This also has significant meaning in more than one way as two of my children are military members (US Army & USN) and the third is married to another (USAF). There isn't a vaccine I would desire more for their protection, while serving this great country, than to see the approval of INO-4800. Inovio remains laser focused because saving lives and protecting our country is in their DNA, too.
