SAN DIEGO, CA – Inovio Pharmaceuticals, Inc. (NASDAQ:INO), a biotechnology company, has announced the entry into a Sales Agreement with Oppenheimer & Co. Inc. on Tuesday, allowing for the potential sale of its common stock. This arrangement enables Inovio to offer and sell shares at its discretion through an "at the market" equity offering.
The agreement, detailed in a form 8-K filed with the SEC on August 13, 2024, outlines the terms under which Inovio may sell common stock with a par value of $0.001 per share. The sales are to be conducted under the company's existing Registration Statement on Form S-3, with a prospectus supplement filed for the offer and sale of common stock totaling up to $60 million.
Sales, if any, will be executed pursuant to the company's instructions, subject to market conditions and other factors. The arrangement with Oppenheimer, which will act as the sales agent, includes a commission of up to 3% on gross proceeds from the sale of the common stock. In addition, Inovio will reimburse Oppenheimer for certain specified expenses related to the agreement.
Inovio retains the right to control the timing and amount of any sales and can suspend the offering at any time. The company has emphasized that there is no obligation to sell any shares and that the filing of the 8-K report should not be considered an offer to sell or a solicitation of an offer to buy securities.
The legal opinion of Cooley LLP regarding the validity of the common stock to be offered has also been filed with the SEC, providing further legal assurance for the potential transactions.
This move by Inovio Pharmaceuticals provides the company with a flexible mechanism to raise capital as needed, in alignment with its strategic financial planning.
The announcement is based on the information contained in a press release statement.
In other recent news, Inovio Pharmaceuticals is facing manufacturing challenges related to its INO-3107's CELLECTRA delivery device, leading RBC Capital Markets to reduce the company's price target from $11.00 to $8.00. This has also delayed the Biologics License Application (BLA) submission for accelerated approval to mid-2025.
In contrast, Inovio's INO-3107 has received certification from the European Medicines Agency's Committee for Advanced Therapies and the Innovation Passport under the UK's Innovative Licensing and Access Pathway, indicating potential for expedited patient access to the new medicine.
Inovio has also appointed Steven Egge as their new Chief Commercial Officer, a move that comes as the company prepares to submit a BLA for INO-3107 under the U.S. Food and Drug Administration's Accelerated Approval Pathway in the second half of 2024.
The company recently reported revenue of $0.1 million and a net loss of $25.0 million for Q1 of 2024.
Analyst firms such as H.C. Wainwright, RBC Capital Markets, JMP Securities, Oppenheimer, and Stephens have maintained positive ratings on Inovio, indicating confidence in the company's ongoing development. These are the recent developments in the company.
InvestingPro Insights
As Inovio Pharmaceuticals, Inc. (NASDAQ:INO) explores financial strategies to support its growth, recent data from InvestingPro offers a snapshot of the company's financial health and market performance. With a market capitalization of approximately $200.96 million, Inovio's valuation reflects investor sentiment and market conditions. Despite facing manufacturing challenges and a delay in their BLA submission, the company’s strategic moves, such as the sales agreement with Oppenheimer & Co. Inc., could provide the necessary capital flexibility to navigate these hurdles.
An InvestingPro Tip indicates that Inovio holds more cash than debt on its balance sheet, suggesting a relatively strong liquidity position that could be advantageous in its efforts to manage operational needs and invest in research and development. However, the company has been quickly burning through cash, which aligns with the reported net loss of $25.0 million for Q1 of 2024. This rapid cash burn rate underscores the importance of the company's ability to access capital markets and manage its financial resources efficiently.
InvestingPro Data also reveals that Inovio's revenue for the last twelve months as of Q2 2024 was $0.59 million, with a significant revenue decline of 93.85%. The company's gross profit margin during the same period was notably negative at -12868.89%, reflecting the costs outweighing the revenue generated. These financial metrics provide context to the company's decision to enter into the Sales Agreement, potentially seeking to bolster its financial position in light of the revenue and margin pressures.
For investors seeking a deeper dive into Inovio's financial outlook and performance metrics, InvestingPro offers additional insights. Currently, there are 12 more InvestingPro Tips available, which can be accessed at https://www.investing.com/pro/INO. These tips could provide valuable information for stakeholders considering Inovio's stock for their portfolios.
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