Inovio Analyst: COVID-19 Competition Could Be Too Great

Inovio Pharmaceuticals Inc INO reported Monday the lifting of the FDA-imposed partial clinical hold on the start of the Phase 2 study of INO-4800, its DNA coronavirus vaccine candidate. 

The Inovio Analyst: Roth Capital Partners analyst Jonathan Aschoff downgraded Inovio from Neutral to Sell and maintained an $8 price target. 

The Inovio Thesis: The Phase 3 portion of the INO-4800 program remains on partial clinical hold until Inovio satisfactorily resolves the FDA's remaining questions related to the CELLECTRA 2000 vaccine delivery device, Aschoff said in a Tuesday note.

Even if Inovio resolves all issues to help advance INO-4800 swiftly into Phase 3 trial, the amount of competition will be too great to allow INO-4800, if approved, to garner much, if any, market share, the analyst said.

Additionally, Inovio has appreciated about 50% since Roth's upgrade of the shares to Neutral on Nov. 9, he said. 

Related Link: The Week Ahead In Biotech: The Vaccine Updates, Drug Presentations, And FDA Decisions That Will Move The Markets

Despite the favorable storage requirements Inovio is touting for its vaccine candidate, the lead time for frontrunners Pfizer Inc. PFE, Moderna Inc MRNA, Johnson & Johnson JNJ and AstraZeneca plc AZN — and the sheer size of three of the contenders — raises serious questions regarding Inovio's ability to compete, Aschoff said. 

The analyst said he does not favor the requirement for the CELLECTRA device for a product requiring such a large-scale launch.

"When it comes to an enormous commercial rollout and slugging it our with big pharma, we are not optimistic for INO-4800," he said. 

INO Price Action: Inovio shares were down 8.95% at $11.70 at the close Tuesday. 

Related Link: The Daily Biotech Pulse: Setback For Alkermes, Boston Scientific's Recall, ALX-Zymeworks Oncology Collaboration

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Posted In: Analyst ColorBiotechDowngradesHealth CarePrice TargetSmall CapAnalyst RatingsGeneralJonathan AschoffROTH Capital Partners
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