Inovio Has 'Bigger Value Drivers' Outside Of COVID-19 Vaccine Program: BofA Analyst

Inovio Pharmaceuticals, Inc. INO, which has fallen behind in the COVID-19 vaccine race, has much to offer beyond a coronavirus vaccine, according to a BofA Securities analyst. 

The Inovio Analyst: Geoff Meacham initiated coverage of Inovio with a Neutral rating and $13 price target.

The Inovio Thesis: Although much of the debate on Inovio is centered around its COVID-19 DNA vaccine, dubbed INO-4800, it has other value drivers in the form of DNA-based medicines for indications such as infectious diseases, HPV-related precancers and oncology, Meacham said in a Wednesday initiation note.

Since INO-4800 contributes significantly to BofA's sum-of-the-parts net present value, volatility around the COVID-19 landscape has kept the firm on the sidelines, the analyst said.

The analyst now estimates global peak sales of $1.6 billion for NO-4800.

"We aren't negative on the clinical profile of INO-4800 vs. competition, but rather, we see the C-19 vaccine market as increasingly saturated, with little room for upside for a later market entrant," Meacham said. 

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Additionally, there are still some de-risking events given that the Phase 2b/3 study remains on hold, the analyst said. The program will progress by midyear, he said. 

Upside is likely from key de-risking catalysts for the rest of the pipeline in the next 12-18 months, Meacham said. 

These catalysts include data from the second Phase 3 study of VGX-3100 in HPV-linked cervical dysplasia, due in 2022; additional Phase 1/2 data from INO-5401 in glioblastoma multiforme around midyear; and Phase 3 data from INO-4800 around the end of 2021, the analyst said.

The rest of the pipeline is upside to BofA's model, including INO-3107 in recurrent respiratory papillomatosis and partnered programs such as MEDI0457 in head and neck cancer, he said. 

INO Price Action: At last check, Inovio shares were trading down 4.99% at $9.80. 

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