INOVIO PHARMACEUTICALS, INC. (INO) SPO
|Company Name||INOVIO PHARMACEUTICALS, INC.|
|Company Address||10480 WATERIDGE CIRCLE
SAN DIEGO, CA 92121
|Company Phone||858 597-6006|
|CEO||J. Joseph Kim|
|Employees (as of 3/14/2017)||239|
|State of Inc||--|
|Fiscal Year End||12/31|
|Exchange||NASDAQ Global Select|
|Shares Over Alloted||0|
|Shareholder Shares Offered||--|
|Lockup Period (days)||180|
|Quiet Period Expiration||8/29/2017|
We estimate the net proceeds to us from this offering will be approximately $70.2 million (or $80.8 million if the underwriters exercise in full their option to purchase additional shares), after payment of the estimated underwriting discounts and commissions and estimated offering expenses payable by us. We intend to use the net proceeds from this offering for general corporate purposes, including clinical trial expenses, research and development expenses, general and administrative expenses, manufacturing expenses and other business development activities. The timing and amount of our actual expenditures will be based on many factors, including the timing and success of our preclinical and clinical trials, our current and any future collaborations for our research and development programs, whether we choose to curtail some of our research or development activities and whether we achieve regulatory approval of any new product candidates. We will retain broad discretion in determining how we will allocate the net proceeds from this offering. Pending the use of the net proceeds from this offering, we intend to invest the net proceeds in investment-grade, interest-bearing instruments.
We face competition at two levels. At the highest level we face competition by an array of existing or development-stage drug and immunotherapy approaches targeting diseases we are pursuing. We are aware of various established enterprises, including major pharmaceutical companies, which are broadly engaged in vaccine/immunotherapy research and development. These include Janssen Pharmaceuticals (part of J&J), Sanofi-Aventis, GlaxoSmithKline plc (and its acquisition of Novartis Vaccines), Merck, Pfizer, and MedImmune, Inc., a wholly owned subsidiary of AstraZeneca, Inc. There are also various development stage biotechnology companies involved in different vaccine and immunotherapy technologies including Novavax, Moderna, BioNTech, Curevac, Advaxis, and Kite. As these companies develop their technologies, they may develop proprietary technologies that may materially and adversely affect our business. A number of companies are developing products to specifically address diseases we are also targeting. Merck and GlaxoSmithKline have commercialized preventive vaccines against HPV to protect against cervical cancer; some companies are seeking to treat early HPV infections or low grade cervical dysplasias; LEEP is the current standard of care for treating high grade cervical dysplasia; Advaxis and Kite have therapeutic cervical cancer product candidates under development. Many companies are pursuing different approaches to prostate, breast, lung and other cancers we are targeting. At another level, we compete more specifically with companies seeking to utilize antigen-encoding DNA delivered with electroporation or other DNA delivery technologies such as viral vectors or lipid vectors to induce in vivo generated antigen production and immune responses to prevent or treat various diseases. These competitive technologies have shown promise but they each also have their unique obstacles to overcome. We believe our electroporation system is strongly positioned to succeed as the dominant delivery method for DNA-based immunotherapies. Viral DNA Delivery This technology utilizes a virus as a carrier to deliver genetic material into target cells. The method is very efficient for delivering immunotherapy antigens and has the advantage of mimicking real viral infection so that the recipient will mount a broad immune response against the immunotherapy. The greatest limitation of the technology stems from problems with unwanted immune responses against the viral vector, limiting its use to patients who have not been previously exposed to the viral vector and making repeated administration difficult. In addition, complexity and safety concerns increase their cost and complicate regulatory approval. Lipid DNA Delivery A number of lipid formulations have been developed that increase the effect of DNA/RNA immunotherapies. These work by either increasing uptake of the DNA/RNA into cells or by acting as an adjuvant, alerting the immune system. While there has been progress in this field, lipid delivery tends to be less efficient than viral vectors and is hampered by concerns regarding toxicity and increased complexity. DNA Immunotherapy Delivery With Electroporation There are other companies with electroporation intellectual property and devices. We believe we have significant competitive advantages over other companies focused on electroporation for multiple reasons: • We have an extensive history and experience in developing the methods and devices that optimize the use of electroporation in conjunction with DNA-based agents. This experience has been validated with multiple sets of interim data from multiple clinical studies assessing DNA-based immunotherapies and vaccines against cancers and infectious disease. Together with our partners and collaborators, we have been the leader in establishing proof-of-principle of electroporation-delivered immunotherapies. • We have a broad product line of electroporation instruments designed to enable DNA delivery in tumors, muscle, and skin. • We have been very proactive in filing for patents, as well as acquiring and licensing additional patents, to expand our global patent estate. If any of our competitors develop products with efficacy or safety profiles significantly better than our products, we may not be able to commercialize our products, and sales of any of our commercialized products could be harmed. Some of our competitors and potential competitors have substantially greater product development capabilities and financial, scientific, marketing and human resources than we do. Competitors may develop products earlier, obtain FDA approvals for products more rapidly, or develop products that are more effective than those under development by us. We will seek to expand our technological capabilities to remain competitive; however, research and development by others may render our technologies or products obsolete or noncompetitive, or result in treatments or cures superior to ours. Our competitive position will be affected by the disease indications addressed by our product candidates and those of our competitors, the timing of market introduction for these products and the stage of development of other technologies to address these disease indications. For us and our competitors, proprietary technologies, the ability to complete clinical trials on a timely basis and with the desired results, and the ability to obtain timely regulatory approvals to market these product candidates are likely to be significant competitive factors. Other important competitive factors will include the efficacy, safety, ease of use, reliability, availability and price of products and the ability to fund operations during the period between technological conception and commercial sales. The FDA and other regulatory agencies may expand current requirements for public disclosure of DNA-based product development data, which may harm our competitive position with foreign and United States companies developing DNA-based products for similar indications.
Inovio is developing active DNA immunotherapies and vaccines focused on treating and preventing cancers and infectious diseases. Our DNA-based immunotherapies, in combination with our proprietary electroporation delivery devices, are intended to generate robust immune responses, in particular T
cells, to fight target diseases. In 2014 we reported that in a controlled Phase 2 clinical study we generated significant, functional antigen-specific T cells, correlated to clinically relevant efficacy against HPV-associated cervical dysplasia (pre-cancer). Our data was published in The Lancet in September 2015. In June 2017 we began a Phase 3 study for VGX-3100 for the treatment of cervical dysplasia. Our novel SynCon immunotherapy design has shown the ability in early clinical trials to help break the immune system’s tolerance of cancerous cells. Our SynCon product design approach is also intended to facilitate cross-strain protection against known and new unmatched strains of pathogens such as influenza. Given the recognized role of CD8+ killer T cells in eliminating cancerous or infected cells from the body and our published Phase 2 results, our scientists believe our active immunotherapies may play an important role in helping fight multiple cancers and infectious diseases. Human data to date have shown a favorable safety profile of our DNA immunotherapies delivered using electroporation. We or our collaborators are currently conducting or planning clinical studies of our proprietary SynCon® immunotherapies for HPV-caused pre-cancers (including cervical, anal and vulvar neoplasia), HPV-caused cancers (head and neck and cervical), prostate cancer, breast/lung/pancreatic cancer, hepatitis C virus, or HCV, hepatitis B virus, or HBV, HIV, Ebola, Middle East Respiratory Syndrome, or MERS, and Zika virus. Our corporate strategy is to advance and protect our differentiated immunotherapy platform and use its unique capabilities to design and develop an array of cancer and infectious disease immunotherapy and vaccine products. We aim to advance products through to commercialization. We continue to leverage third party resources through collaborations and partnerships including product license agreements. Our partners and collaborators include MedImmune, LLC, The Wistar Institute, University of Pennsylvania, GeneOne Life Science Inc., ApolloBio Corporation, Plumbline Life Sciences, Inc., Drexel University, National Microbiology Laboratory of the Public Health Agency of Canada, National Institute of Allergy and Infectious Diseases, United States Military HIV Research Program, U.S. Army Medical Research Institute of Infectious Diseases, HIV Vaccines Trial Network and Defense Advanced Research Projects Agency. --- We were incorporated in the state of Delaware in June 2001. Our principal executive offices are located in the United States at 660 W. Germantown Pike, Suite 110, Plymouth Meeting, Pennsylvania 19462, our telephone number is (267) 440-4200 and our website is www.inovio.com.
|Auditor||Ernst & Young LLP|
|Company Counsel||Cooley LLP|
|Company Counsel||Duane Morris LLP|
|Lead Underwriter||Citigroup Global Markets Inc|
|Lead Underwriter||Piper Jaffray & Co.|
|Lead Underwriter||RBC Capital Markets, LLC|
|Underwriter||Aegis Capital Corp.|
|Underwriter||H.C. Wainwright & Co., LLC|
|Underwriter||Maxim Group, LLC|
|Underwriter||National Securities Corp|
|Underwriter Counsel||Dechert LLP|
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