I’ll put this as simple as possible: avoid Inovio Pharmaceuticals (NASDAQ:INO). There are far better opportunities to be found in companies nearing late-stage vaccine results. With INO stock, it’s like watching paint dry.
The first time I highlighted opportunity in INO stock, it traded at $4.86 in January. By July, INO was up to $27 for a gain of 456%. Confident the company was seeing progress, I said it could run to $30 a share. But that never happened.
Instead, INO stock was crushed, last traded at $10.49 a share by Thursday’s close.
While I’d like to tell you it’s a blood-in-the-streets opportunity, but I can’t. And while I’d love to watch it return 456% again soon, but it’s not going to happen. Avoid it for now.
FDA’s Clinical Trial Hold Isn’t Helping INO Stock
It’s been a month since the FDA put a partial clinical hold on Inovio’s planned Phase 2/3 trial, saying it has “additional questions about the company’s planned Phase 2/3 trial of its COVID-19 vaccine candidate INO-4800, including its Cellectra 2000 delivery device to be used in the trial,” as noted in the company’s latest press release:
“This partial clinical hold is not due to the occurrence of any adverse events related to INOVIO’s ongoing expanded Phase 1 study of INO-4800, the conduct of which may continue and is not impacted by the FDA’s notification.”
That news hit on Sept. 28 and we have yet to hear anything more on it. INO stock is down 30% since that release.
Meanwhile, its competitors are pushing further ahead into late stage trials, including: Pfizer (NYSE:PFE), BioNTech (NASDAQ:BNTX) and Moderna (NASDAQ:MRNA). All while Inovio is still stuck at the gate, hoping the US FDA will allow it do something.
But Wait, There’s More…
The hits keep coming for Inovio. After the FDA’s partial hold, CEO Joseph Kim said the company had expected to announce funding for its Phase 2/3 study by the end of September, according to Motley Fool contributor Keith Speights. Unfortunately, that funding never came through from our understanding.
Then, they dropped their appeal of a Pennsylvania’s judge’s decision to deny an injunction against its contract manufacturer.
According to Philadelphia Business Journal contributor John George:
“Inovio was seeking an injunction to immediately force VGXI, with whom it had a contract to make doses of its experimental INO-4800 vaccine, to provide proprietary manufacturing information Inovio said it needed — and to which it believed it was entitled — for large-scale production of the vaccine. VGXI, which has its headquarters in Blue Bell and its principal place of business in Texas, sued Inovio in July, alleging the company misappropriated VGXI trade secrets and breached its contract.”
Despite the Chaos, Still a Fighting Chance
Even with all of the hits, it’s possible INO stock could make a triumphant return. For example, if the FDA allows trials to continue, INO stock could explode again. The company even has Thermo Fisher Scientific (NYSE:TMO) on board to manufacture 100 million doses of INO-4800 annually.
But right now, until that happens, and until we have far more clarity, I’d avoid INO stock.
Buying INO right now would be more of a gamble, than a solid investment opportunity. There are still too many unanswered questions and unexpected hurdles standing in the way of progress here. For the time being, I’d look to trade other pharmaceutical stocks that are either nearing or in late-stage trials.
We’ll have a better idea of where the company stands when it releases earnings. They’ll be out after the markets close on Nov. 9.
On the date of publication, Ian Cooper did not have (either directly or indirectly) any positions in the securities mentioned in this article.
Ian Cooper, a contributor to InvestorPlace.com, has been analyzing stocks and options for web-based advisories since 1999.