Biotech company iBio (NYSE:IBIO) has been among the hottest in the space, as it works to develop a vaccine for Covid-19, the disease caused by the novel coronavirus. The company has innovative technology, high-profile backers, a top-notch leadership team and a well-connected partner. All of this makes IBIO stock stand out among other biotech stocks now. It’s also much cheaper than many of the other companies looking to develop a coronavirus vaccine.
But is there more to the story?
While there’s plenty of promise behind IBIO stock, the company seems to be behind in the race to develop a coronavirus vaccine. As a result, I wouldn’t advise investors to buy the stock now, but I do think it’s a good idea to keep an eye on iBio as the development of its vaccine progresses.
The company uses plants, rather than the traditional animals or microbes, to develop vaccines. According to Robert Erwin, the company’s president, “plant-based production significantly reduces the time and cost associated with: (i) the initial upstream setup and execution, (ii) production scale-up, and (iii) characterization and quality assessments compared with conventional bioproduction methods.”
The company’s CEO, Tom Isett, said in a statement that the company “could make about 500 million doses” of a vaccine independently.
Using plants to develop vaccines also enables the vaccines that are created during the commercial production process to be very similar to researchers’ original concept, Erwin explained.
Moreover, virus-like particles (VLPs), the technology that iBio is using to develop its vaccine, “represent a promising alternative to [traditional] soluble antigens, as their shape, size, repetitive antigen structure, and geometry have been shown to trigger stronger immune response, both humoral and cellular,” according to pharma’s almanac. Erwin supports this notation, explaining that the plant-based VLPs that iBio is using are “likely to rapidly prove to be safe and effective, based on prior experience.”
A flu vaccine that uses VLPs has demonstrated “clinical success” in a Phase III trial, reported pharma’s almanac. Moreover, IBIO-200, iBio’s vaccine, incorporates Oligomannose glycosylation, which “is thought to lead to better cellular uptake” of the vaccine by the immune system.
iBio’s vaccine manufacturing facility was “originally built in 2010 with funding from the Defense Advanced Research Projects Agency (DARPA), part of the U.S. Department of Defense.” That fact indicates that the U.S. government was upbeat on the company’s technology.
Strong Executives and Well-Connected Partners
Isett became CEO of iBio on March 12. He was the general manager of General Electric’s (NYSE:GE) BioProcess unit, which is now part of Danaher (NYSE:DHR) and spent 19 years at medical supplies seller Becton Dickson (NYSE:BDX). At the latter company, Isett led the Core Microbiology unit. While working for biologics contract manufacturer Lonza (OTCMKTS:LZAGY), he managed the firm’s cell processing technologies unit.
Meanwhile, Erwin “served as chairman of Icon Genetics AG from 1999 until its acquisition by a subsidiary of Bayer AG in 2006″ and “led Large Scale Biology Corporation from its founding in 1988 through 2003, including a successful initial public offering in 2000.” He holds an MS in Genetics from Louisiana State University.
The biotech company is partnering with the Infectious Disease Research Institute (IDRI), on its Covid-19 vaccine. IDRI is part of the University of Washington, whose modeling has been used by the White House and NIH to predict the spread of coronavirus. Notably, IDRI has also received funding from the Bill & Melinda Gates Foundation. And iBio is also collaborating with Beijing-based CC-Pharming, potentially giving iBio the inside track to provide a Covid-19 vaccine to China.
But iBio is not on a list of companies provided by Wired that have begun conducting Phase 1 and Phase II trials on a coronavirus vaccine. That suggests that the company is not, at this point, one of the front-runners in the race to develop a Covid-19 vaccine.
The Bottom Line on IBIO Stock
The company appears to have solid technology, strong leadership and well-connected partners. Moreover, the market cap of iBio stock is much lower than some other companies that are trying to develop a coronavirus vaccine. Specifically, iBio has a market cap of $103 million, while Moderna (NASDAQ:MRNA), Inovio (NASDAQ:INO) and Novavax (NASDAQ:NVAX) have market caps of $24 billion, $2 billion and $2.3 billion, respectively.
So it appears that if iBio can make some progress with its coronavirus vaccine, IBIO stock could easily rally 500% above its current levels. That’s why the stock is definitely worth watching.
Larry Ramer has conducted research and written articles on U.S. stocks for 13 years. He has been employed by The Fly and Israel’s largest business newspaper, Globes. Larry began writing columns for InvestorPlace in 2015. Among his highly successful, contrarian picks have been Lyft, solar stocks and Snap. You can reach him on StockTwits at @larryramer. As of this writing, he did not own any of the aforementioned securities.