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. 

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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. 

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