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Avoid Inovio Pharmaceuticals Like the Plague

Avoid Inovio Pharmaceuticals Like the Plague

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If shares of Inovio Pharmaceuticals (NASDAQ:INO) were to cliff dive from their current price of $12.48 per share to $1, that would amount to a) a decline of more than 90% in INO stock; b) the biggest such investor travesty for a company in the hunt to produce a novel coronavirus vaccine; and c) a remarkable news story. And to be clear, the Philadelphia-area biotech firm appears safe from such a fate for the foreseeable future.

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But those who know their investment ABCs will tell you that one noteworthy activist short seller is betting on an Inovio dollar-share debacle. Andrew Left, editor for Citron Research, didn’t exactly mince words in an April 27 report  “Bad Blood: The COVID-19 Version of Theranos: Target Price $1.” (The now-defunct Theranos fraudulently claimed it could perform multiple tests from a drop of blood.)

Here are some choice lines from the 12-page investor broadside, which I read with astonishment:

  • “Inovio shareholders have been ‘Theranosed’ and the SEC should immediately halt this blatant stock promotion.”
  • “Simply put, the management team at Inovio is a group of charlatans.”
  • “Inovio is guilty of issuing highly misleading information to pump the company’s stock price. … In the case of COVID-19, they are taking advantage of retail investors while they’re stuck in quarantine.”

Ouch. Yes, Citron uses some over-the-top verbiage to slam Inovio stock. But in the case of the Covid-19 vaccine race, slash-and-burn hyperbole beats a suspect hypodermic any day. And so we present, the upshot, down shot and my best shot at getting to bottom of it all.


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INO Stock at a (Sideways) Glance

Since Sept. 16, Inovio has lost a third of its value; over 2020 as a whole, though, it has nearly tripled in

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Could Inovio Pharmaceuticals Be a Millionaire-Maker Stock?

Could Inovio Pharmaceuticals Be a Millionaire-Maker Stock?

Inovio Pharmaceuticals (NASDAQ: INO) seemed like it could make millionaires out of many average investors — and fast — earlier this year. The clinical-stage biotech company soared 718% from the start of 2020 through its high point in July. Why? Inovio was among the first companies to begin testing a coronavirus vaccine candidate in human trials, and was early to report trial data. As a result, the company found itself among the early leaders of the coronavirus vaccine race.

Could Inovio Pharmaceuticals Be a Millionaire-Maker Stock?

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Could Inovio Pharmaceuticals Be a Millionaire-Maker Stock?

A lot has happened since then, and it hasn’t all been good news. Inovio’s stock has suffered a 52% decline from its July peak. So is Inovio still a stock that could turn a thousand-dollar investment into a million? Let’s take a closer look.

a person holding an object in his hand: A man wearing a denim shirt holds out a handful of $100 bills.

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A man wearing a denim shirt holds out a handful of $100 bills.

The beginning wasn’t pretty

Inovio’s troubles actually began after it reported interim phase 1 data from its vaccine candidate’s clinical trials in June. The results weren’t bad. The problem was that investors wanted more detail about neutralizing antibody levels in trial participants. Neutralizing antibodies are important because they do the work of blocking future infection. Therefore, achieving the antibody levels needed to achieve immunity is key in developing an effective vaccine. Inovio first reported that 94% of participants showed an immune response involving binding and neutralizing antibody activity, as well as a T-cell response. Shares slipped by 27% following the news. Investors were disappointed because Inovio didn’t provide more particular data, unlike its competitors. Rival Moderna (NASDAQ: MRNA), for example, provided neutralizing antibody level information in comparison to those found in recovered coronavirus patients. Moderna was able to make the important distinction that its coronavirus vaccine candidate

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Inovio Pharmaceuticals Does Not Need Any More Misfortune

Inovio Pharmaceuticals Does Not Need Any More Misfortune

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Perception is reality. And that’s a harsh reality for Inovio Pharmaceuticals (NASDAQ:INO) and investors in INO stock. The stock is down 62% since the end of June. However, if you listen to at least one analyst, the stock has further to drop.

the inovio (INO) logo covered up by pills and a syringe

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If you’ve been keeping up with the vaccine race, you’ll recall that Inovio’s Covid-19 vaccine candidate uses unproven DNA vaccine technology. With the population still anxious about a vaccine in general, the idea of a vaccine that uses DNA may be a bridge too far for the Food and Drug Administration (FDA).

But getting its vaccine approved is only the first of two problems that may keep INO stock down. The second I believe is actually the larger threat that may be just coming to light. But both represent the fundamental risk of biotech stocks in the face of a global pandemic, nothing is decided until it’s decided.

Let’s look at each individually.

The FDA Has a Few Questions

To a biotech firm, those words must be like hearing you’re going to get audited by the Internal Revenue Service. The FDA is not letting Inovio move into late-stage trials for its Covid-19 vaccine candidate, INO-4800, until it answers some questions.

The problem is nobody, not even the bearish analysts, knows exactly what the FDA’s questions are. According to Inovio, the company has not seen any side effects in its Phase 1 trial. So what could it be?

Based on what I know of Inovio’s progress to date, there could be several issues. The first may be the size of Inovio’s trial. Johnson & Johnson (NYSE:JNJ) is going forward with a very robust 60,000 candidate trial. With the scrutiny being put

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