Inovio Pharmaceuticals, Inc. (INO) Earnings Call Transcript & Summary

So Inovio represented by Jacqui Shea, the company's President and CEO. My name is Eric Schmidt. I'm one of the biotechnology analysts at Cantor Fitzgerald, and I'm sharing this fireside chat with my colleague, Alexa Deemer. So Jacqui, thank you for coming. Maybe just high level, I know you've got an important FDA action date coming around the corner, which we're going to get into. But for those less familiar with Inovio, what are the 2-minute highlights?

Yes. Well, first of all, thanks very much for the invitation. It's nice to be here today. So Inovio is a clinical-stage company. We're focused on developing DNA medicines to help treat and prevent HPV-related diseases, cancer and infectious diseases. As Eric mentioned, we've got a very exciting PDUFA date coming up in a few weeks' time, on the 30th of October, for our lead program, which is INO-3107 for the treatment of recurrent respiratory papillomatosis or RRP. And following on behind that also based on our DNA medicines platform, we have a deep clinical pipeline of other candidates.

So tell us a little bit more about your DNA medicines platform, what that means, what that entails?

Yes. So DNA medicines have been around for quite a while. And what makes Inovio different is really our delivery system. So we start off by identifying target proteins that we want to produce within the body. We then optimize them using our proprietary algorithms. And then we insert the optimized sequence into a circular molecule of DNA called a plasmid. And then we use our proprietary delivery system called CELLECTRA to enable the DNA plasmids to enter the cells. And CELLECTRA works by very brief electrical pulses, which open pores in the cell membrane, allow the DNA plasmids to enter the cell and then the pores close back up again. And these are really rapid electrical pulses, millisecond pulses. So once the plasmids are in the cell, they are transcribed into mRNA, then translated into protein. And then depending on how we design the protein, they can either be secreted from the cell or processed within the cell for antigen presentation. So our DNA medicines platform is very flexible. We can produce pretty much any kind of protein. And then we can use that protein to either drive an immune response. DNA medicine is particularly good at driving T cell responses, which is important for treating cancer and virally mediated diseases. And it's also very good at producing sustained protein levels. So this is particularly good for treating diseases where you've got a missing or a defective protein and you need to supply that protein. So those are really the core advantages of the platform.

And then the CELLECTRA device, how is that delivered? What's the patient experience going through that. Tell us a little bit more about what it looks like.

So we use our CELLECTRA devices to either deliver our DNA medicines to either skin or muscle cells. With the muscle cells, it's pretty similar to an IM injection, but then followed by these rapid electrical pulses, which enable the DNA plasmids to enter the cell. And it's a very simple, straightforward administration. Our device consists of a base station, a handset, a single-use disposable needle array. You insert the plasmid drug cassettes into the single-use needle array, attach it to the handset, remove the safety cap, apply it to the deltoid muscle that you previously used an alcohol wipe on. And then it's a single button press and that injects the plasmids, delivers the electrical pulses, whole process is over in seconds. Any health care provider can be trained to use it. And patients tell us whilst there is mild-to-moderate injection site discomfort, that resolves pretty quickly within 5 to 10 minutes. And patients tell us overall, it's a very tolerable process. But the key thing about DNA medicines, though, is unlike other T cell generating approaches like viral vectors, you don't get the systemic kind of responses, systemic flu-like symptoms that you can get with other systems. So after the injection site discomfort resolved, we really see very, very few adverse events.

We'll talk about the lead program, 3107 for RRP in a moment. But does the device itself require approval concomitantly?

So that really depends on the territory. So in the U.S., it's regulated as a combination product. So it doesn't have a separate approval. Ex U.S., the device can be regulated independent. So for instance, in the EU, we have CE marking for the device already.

And then sticking with the high level as we start to dive down into the story, what do you think investors are missing about Inovio today?

Yes. So I think investors are perhaps not quite appreciating how close we are to bringing the first DNA medicine potentially to approval and commercialization and then the deep pipeline that follows behind based on the platform. I think those are the -- we have a lot of exciting potential catalysts coming up.

Your DNA medicines platform could, I guess, in theory, go into so many different directions. I know over the course of the company's history, you've investigated a few different things. Why is RRP the right opportunity? And what are other kind of landscaping exercises you've been [indiscernible] land here?

Yes. So I think RRP is really a great opportunity for DNA medicines because it's really leveraging a core strength of the platform, this ability to generate antigen-specific T cells that can go after the virus that causes RRP. So RRP is caused by HPV 6 and 11. Inovio has had a long history of working in the HPV space, and we have demonstrated the ability to eliminate the virus in other HPV-related indications. So it was a combination of our expertise in HPV treatment, a disease with really high unmet need as well and then really leveraging this ability to drive the strong T cell response.

So how are patients with RRP managed today? And maybe you can elaborate a little bit more on what the unmet need is.

Yes. So to tell you a bit more about RRP because it's a rare disease and everybody may not be familiar with it. RRP is caused by HPV types 6 and 11. It can be -- you can get disease throughout the respiratory tract, but it mainly forms around the vocal cords. And what happens is you get the growth of these wart-like papillomas on the vocal cord. It can make it very difficult to talk, swallow, breathe. In some cases, RRP can spread throughout the respiratory tract, go to the lungs, become malignant. And in those cases, the outcomes are pretty poor. So treatment today or standard of care today really remains surgical reduction of the papilloma, either by laser or by scalpel. And because you can't cut a virus out with a scalpel, these papilloma grow back time after time, hence, the name recurrent respiratory papillomatosis. And these surgeries, they're not curative. They're not eradicating the virus. And the problem is the surgeries themselves come with a risk to the patient. And the risk is permanent damage and scarring of the vocal cords and of the respiratory tract tissues. And that scarring in itself can lead to future surgeries as well. So it's a horrible cycle of disease, surgery, more surgery.

And just so maybe we can understand the burden of the current standard of care, on average, how many surgeries would you say that patients get per year.

Yes. So there's not a lot of data out there. We enrolled patients who'd had between 2 and 8 surgeries in the prior year into our clinical trial. And we think that's pretty representative of the population with active disease. So on average, about 4 surgeries a year.

Okay. And maybe now you can walk us through the Phase I/II trial. What was the study design, patient population, enrollment criteria? What endpoints did you evaluate and what the data showed? And maybe you can also comment how the data compared to your initial expectations.

Yes. So I think the first thing to bear in mind is what patients are most concerned about is reducing the number of surgeries because each surgery comes with this risk of permanent vocal cord damage. So that's what they're really focused on. And we designed our clinical trial with that in mind. So what we were doing is really looking for a reduction in surgery. So this was a Phase I/II trial, 32 patients. We enrolled patients who had between 2 to 8 surgeries in the year prior. And we enrolled patients who had either been diagnosed with HPV-6, HPV-11 or a combination of the 2 serotypes so they had to have had confirmed HPV 6 or 11 disease before trial entry. And then our regimen is when patients required a clinically required surgery, they had that surgery, they entered into the trial and then we gave them 4 doses over a 9-week time period, so 1 dose every 3 weeks. And it's very important to note that we counted every surgery after day 0 because as I said, every surgery matters to patients. And we were really pleased with what we saw. So in the first year following treatment, 72% of the patients experienced a 50% to 100% reduction compared to the year prior. And this clinical efficacy strengthens into year 2, where that figure went up to 86%. If we look at patients who required no surgeries during year 1, that figure was 28%, strengthening into 50% in year 2. So we saw a really good clinical response. We were really pleased with that.

So I guess maybe taking a step back, you said that patients needed to either have HPV-6, 11 or both. So what percentage of RRP patients are either 6, 11 or both?

Yes. So it's estimated over 95% of RRP patients are 6 or 11. The majority of the disease, about 2/3 is HPV-6. HPV-11 is actually potentially correlated with slightly worse disease course. And then some unfortunate patients have both serotypes.

Okay. And you commented on the very impressive efficacy profile. Maybe now you can elaborate a little bit more on safety and tolerability.

Yes. We were really pleased with the safety and tolerability profile we saw, mainly grade 1/2 adverse events, very few systemic events. With DNA medicines, we really don't see the flu-like symptoms that you see, for instance, with viral vectors.

Okay. Got it. So then the BLA was submitted under the accelerated approval pathway, but then the FDA flagged that the data package may not be adequately eligible for the accelerated approval pathway. So maybe you can comment on what the company has done since then to strengthen the case and where things stand today.

Yes. And I think it really goes back to the fact that there was a product previously approved last year. So when you have a previously approved product that has a full approval under accelerated approval, you have to do 2 things. You have to show that there's a continued unmet need and then you have to show that you provide a meaningful therapeutic benefit over the available treatment. And we think we've done exactly that through INO-3107 efficacy, tolerability and a patient-centric treatment approach. What I mean by that is the currently approved product, it doesn't work in all patients. And it also requires surgery as part of their treatment regimen. So over their 12-week treatment regimen, they scoped their patients at doses 3 and 4. And if visible papilloma were present, those papilloma had to be removed. In contrast, with 3107, we don't require the scoping and surgeries at doses 3 and 4. So we have a significant safety advantage because we're not requiring those additional surgeries as part of the treatment regimen. We're also using different antigens as well. And because of the different delivery systems, we're not impacted by pre-existing neutralizing antibodies or the papilloma microenvironment. So we believe that we can treat patients that Papzimeos doesn't work in.

And did the FDA ever comment why the data package may not be eligible for the accelerated approval pathway?

So when we received this comment in the file acceptance letter, and it was a preliminary conclusion of a potential review issue that we may not be eligible for review under the accelerated approval pathway. We requested a Type A meeting. FDA denied that request saying that our review was ongoing, we weren't stalled, but they did offer an informal clinical meeting to discuss the review pathway. And they asked us to complete an assessment phase. So we put all of our clinical data and efficacy and safety data in the BLA into the Assessment Aid template. We also completed some additional analyses that FDA had requested. And then we submitted this Assessment Aid back in February. Unfortunately, FDA took some time scheduling that clinical informal meeting, and it wasn't until we had new leadership in place at CBER and OTP that, that meeting was scheduled in July. So we held our clinical informal meeting in July. We presented the totality of our clinical data for efficacy and safety. We were also accompanied by representatives from the Patient Advocacy Foundation, the Recurrent Respiratory Papillomatosis Foundation as well as a KOL physician who treats a large number of patients. And they both testify to the continuing unmet need and the meaningful clinical benefit that they see with 3107 and 3107's ability to meet that unmet need. We thought it was a very productive meeting. Unfortunately, FDA told us that due to the late stage of the review, they were unable to comment on the review pathway at that time. So since then, we've completed all of our pre-licensure inspections, just had one observation, which we believe we've now resolved, and we're now expecting to enter labeling discussions in September.

Okay. And maybe you can remind us when the PDUFA is and if you have any outstanding thoughts going into that PDUFA date?

Yes. So our PDUFA date is October 30. As I mentioned, we're expecting to enter into labeling discussions. And we also will need to confirm the design of any confirmatory trial under the accelerated approval pathway with FDA.

Okay.

Will you be informing the investment community if you enter labeling discussions? Or what are the next communicable milestones?

Yes. Well, of course, we'll continue to keep everybody informed of any material information. But until FDA issue a final decision, I think it's important that we comment on sort of real facts as we go through these final stages of the review process.

And how are you thinking about the design of a potential confirmatory study?

So we had previously proposed to FDA a placebo-controlled design, so 2:1 randomization active to placebo. It would be about 100 patients. We had alignment with FDA on that design ahead of submitting our BLA, and we're obviously waiting to see FDA's comments on that design. They did say at the late-cycle meeting that they will be providing us a comment.