Pennsylvania-based Inovio Pharmaceuticals (NASDAQ:INO) announced that it secured a $71 million contract from the U.S. Department of Defense sending the company’s stock to a new all-time high. The contract is for the scale up manufacture of Inovio’s Cellectra 3PSP smart device as well as the procurement of Cellectra 2000.
Both products are portable, hand-held devices designed to deliver Inovio’s novel COVID-19 DNA vaccine candidate INO-4800 directly into the skin. The vaccine then prompts the immune system to drive a robust immune response to avoid virus infection.
The company’s next generation smart devices are upgrades to an earlier version of an efficacy delivery device that received the CE mark certification in Europe where it has been used to safely dose over 2,000 patients in clinical trials of Inovio’s DNA medicines.
The contract came from the Department of Defense’s Joint Program Executive Office for Chemical, Biological, Radiological, and Nuclear Defense Enabling Biotechnologies (JPEO-CRBND-EB) which is funded by the Defense Health Program.
Funding adds to other recent financial backing
The contract adds to Inovio’s receipt of two separate grants totaling $10 million that were received from the Bill and Melinda Gates Foundation and the Coalition for Epidemic Preparedness Innovation (CEPI). That funding was provided to help accelerate the testing phase of the Cellectra 3PSP device. Development of the product began last year supported by the receipt of $8.1 million in funding from the U.S. Defense Threat Reduction Agency’s Medical CBRN Defense Consortium.
The government’s support of Inovio’s proprietary intradermal DNA delivery device comes at a time when cases of the deadly virus have increased in certain U.S. states and international regions as economies have begun to reopen.
The announcement also comes just days before Inovio is expected to provide a highly anticipated report on its interim phase 1 clinical trial of INO-4800. Pending the results of the trial, it is planning to launch a phase 2/3 efficacy study of the COVID-19 vaccine candidate later this summer.
President and CEO Dr. J. Joseph Kim stated, “Inovio is very pleased to receive this significant funding from the U.S. Department of Defense to continue our rapid-scale-up capacity for our breakthrough DNA medicines delivery device Cellectra. We look forward to working closely with DoD, JPEO-CBRND and JPL-CBRND-EB to provide much needed protection to DoD personnel and their families through the development of a safe and effective vaccine against COVID-19.”
The substantial Department of Defense contract is a major win for Inovio. While the results of the phase 1 trial of the INO-4800 vaccine remain unknown, it suggests that the government arm has a high degree of confidence in the potential of the vaccine candidate.
The funding will allow Inovio to ramp production of its devices and arrays with the hope of potentially delivering INO-4800 to hundreds of millions of people globally by 2021 to help fight the coronavirus pandemic. The company’s manufacturing facility in San Diego has already produced initial quantities of the devices and if necessary, production can be outsourced to contract manufacturers.
Shares of Inovio were up more than 40% in midday trading on June 23rd in response to the announcement. Investors now await the results of the phase 1 trial which are expected by early next week.