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Inovio Pharmaceuticals Advances Vaccine Platform With Over $15 Mln In Cash

Inovio Pharmaceuticals (AMEX: INO) reported last night its third quarter results, saying it has enough funds to last until the third quarter of next year.

As of September 30, it had cash and equivalents, plus short-term investments, of $15.2 million, which it believes is sufficient to meet its planned working capital requirements until late in 2013.

Inovio's SynCon vaccines are designed to provide two capabilities not achievable with conventional vaccines: stimulation of T-cell immune responses to provide therapeutic capabilities, and universal cross-strain protection and treatment against known as well as newly emergent unmatched strains of pathogens. The company has clinical programs for cervical dysplasia, leukemia, the hep C virus, the flu and HIV.

During the third quarter, Inovio reported that its SynCon vaccine against cervical cancer, known as VGX-3100, achieved an "industry first" when T-cell immune responses induced by this vaccine were shown to generate a strong killing effect against cells changed by HPV into precancerous cervical dysplasias.

Enrollment is ongoing in Inovio's phase II clinical study of VGX-3100 for cervical dysplasia. Data is expected in late 2013.

Two Inovio collaborators, the University of Southampton and ChronTech Pharma AB, are also expected to report interim data from their phase II studies of DNA vaccines for leukemia and hepatitis C virus, respectively, before the end of the year. Inovio said that both of these vaccines are designed to generate T-cell responses to provide therapeutic benefits.

In addition, Inovio reported that its H1N1 influenza vaccine "construct" generated protective immune responses in humans against the nine key H1N1 flu strains of the past 100 years, including the 1918 pandemic flu strain. None of these viruses were matched to the vaccine, the company said.

These results added to the second quarter results in which Inovio's avian flu, or H5N1, vaccine construct generated "significant immune responses" against six different unmatched strains of H5N1 in a human clinical trial.

Together, the vaccine maker said these results also represent an industry first and "a major stride" toward universal vaccines for the flu, as well as other rapidly changing viruses such as HIV. It expects to report additional data from the H1N1 study in the first quarter of next year.

The drug maker also treated the first patients in its third flu clinical trial, with this study testing immune responses in elderly adults immunized with the company's H1N1 SynCon universal flu vaccine. The company said the 65+ age group represents about 90 per cent of annual flu deaths in the US.

Interim data from this study is expected in the first half of next year.

In terms of financial results, the company reported a $2.1 million increase in net loss in the quarter to $6.6 million, due to a change in the fair value of its common stock warrants, and a decline in grant revenue. On a per share basis, net loss was 5 cents per share, versus 4 cents per share a year ago.

Total revenue was $855,000, compared to $2.6 million a year ago, due to the timing of work performed under its contract with the National Institute of Allergy and Infectious Diseases.

This contract, which exceeds $23 million over five years, plus two additional option years, is facilitating Inovio's development of the universal, preventive HIV DNA vaccine, Pennvax GP.

Total operating expenses were $7.1 million, compared to $9.0 million in the third quarter of 2011. General and administrative expenses were slightly higher, while research and development costs declined.

Inovio said it continues to advance discussions with "large pharmaceutical companies" with the aim of securing strategic partnerships to advance the development of its SynCon vaccines.

The company's VGX Animal Health subsidiary also saw progress in the quarter, as it reported advancements for its growth hormone releasing hormone (GHRH) treatment focused on boosting the health and food production efficiency of farm animals. It was granted marketing approval in New Zealand for its high-dose plasmid therapy that increases live births in pigs, following approval in Australia.

It also reported that its new low-dose version of this therapy, LifeTide SW 1.0, resulted in more live pigs per litter and higher birth and weaning weights.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.