Inovio Pharmaceuticals, Inc. (INO) Q2 2020 Earnings Report, Transcript and Summary

Good day, and welcome to the Inovio Second Quarter 2020 Financial Results Conference Call. All participants will be in a listen-only mode. [Operator Instructions] After today's presentation, there will be an opportunity to ask questions. [Operator Instructions] Please note this event is being recorded. I would now like to turn the conference over to Ben Matone, Senior Director of Investor Relations. Please go ahead.

Thank you, operator. Good afternoon, and thank you for joining the Inovio's second quarter 2020 earnings conference call. Joining us today are Dr. J. Joseph Kim, President and CEO; Dr. Kate Broderick, Senior Vice President of Research and Development and Project Lead for Inovio's infectious disease programs; Dr. Jackie Shea, Inovio's Chief Operating Officer; and the company's Chief Financial Officer, Peter Kies. For today's call, we will review our corporate and financial information for the second quarter 2020 ended June 30, 2020 and as well as provide an update on our clinical programs progress, which includes the accelerated development for our COVID-19 vaccine program. This call is being webcast live on our website ir.inovio.com, and a replay will be made available. Following prepared remarks, we will be conducting a question-and-answer segment reserved for equity research analysts. During the course of this conference call, we will be making forward-looking statements regarding future events and the future performance of the company. These events relate to our business plans to develop Inovio's integrated platform of DNA medicines, which include clinical and regulatory developments, and timing of clinical data readouts along with capital resources and strategic matters, as well as the impact of the COVID-19 pandemic on Inovio's business operations. All of these statements are based on the beliefs and expectations of management as of today. These statements involve certain assumptions risks and uncertainties and could cause actual results to differ materially. We assume no obligation to revise or update forward-looking statements, whether as a result of new information, future events or otherwise. Investors should read carefully the risks and uncertainties described in today's press release, as well as the risk factors included in today's 10-Q filing with the SEC. With that, I would now like to turn the call over to Joseph.

Thank you, Ben, and thanks everyone for joining the call today. We began this year stating that we were entering a new era for DNA medicines. This was before COVID-19, became the most urgent public health crisis the world has seen in a century. We are very proud of our accomplishments to date. In addressing this growing pandemic and the evolving nature of SARS-CoV-2 the virus that causes COVID-19. The challenges of this still relatively unknown virus cannot be understated. We understand the importance of continuing to develop our scientific and medical understanding of the virus and its effects and having multiple approaches to defeat it remains paramount. Over the last decade, Inovio has led the field in demonstrating how optimized DNA plasmids can be rapidly developed and delivered into cells using the select trust smart device that overcomes historical obstacles in effectively delivering DNA medicines and producing safe and robust immune responses. Our goal is to generate data that challenges the status quo and focuses on the efficacy, durability, versatility and safety of our DNA medicines, all of which are critical when confronted with a novel virus. We are delivering on that goal, and I am very proud of our COVID-19 DNA vaccine development team, which is led by Dr. Kate Broderick. She will be sharing with you shortly the amazing work completed this quarter with our COVID-19 DNA vaccine INO-4800. And I once again want to thank Kate and her – and our entire Inovio team for their tireless and extraordinary efforts to combat this great threat. Through these efforts our INO-4800 Phase 1 clinical results, which is now undergoing peer review for publication at a top medical journal have demonstrated robust immunogenicity, including neutralizing antibodies and T cell responses both CD8 and CD4 T-cell responses and a uniquely favorable safety profile that supports the foundation of promising responses we have seen in more than 2,000 patients and over 7,000 application of our DNA medicines with our CELLECTRA delivery devices. Inovio has also set the standard with INO-4800 for durability of a protective response in a non-human primary animal challenge study at four months post vaccination and has shown balanced antibody anti-cell immunogenicity against the emerging dominant strain of the virus known as G614. To our knowledge, we are the first to report generation of neutralizing antibody against this mutated strain of the coronavirus by vaccinating non-human primates. This data is published as a preprint on Bioarchive and is currently under review at a peer review journal. We look forward to publishing our additional animal challenge studies as well as being a part of operation wharf speeds non-human premier animal challenge study. We also have made significant strides in expanding our global coalition to manufacture large-scale quantities of INO-4800 and smart devices to deliver them. I look forward to having our Chief Operating Officer Dr. Jackie Shea provide you with our latest manufacturing update. I want to thank our partners and growing global manufacturing coalition which includes Richter Helm Biologics in Germany, other large-scale European manufacturers, and Ology Bioservices, and other large-scale manufacturers here in the U.S. I also want to thank our current funders including the U.S. Department of Defense, CEPI, and the Bill & Melinda Gates foundation. With this support, we look forward to advancing INO-4800 into a Phase 2/3 trial in September and meeting our target to provide at least 1 million doses of our DNA vaccine this year and 100 million doses in 2021. And while this past quarter has been dominated by COVID-19 news our team continues to drive forward our overall DNA medicines pipeline with important milestones that support our goal to produce data to challenge the status quo and focuses on the safety, efficacy, durability, and versatility of our DNA medicines. As a quick recap, over the quarter, we accomplished the following. First, we presented positive interim data from our Phase 1/2a trial for our Middle East respiratory syndrome DNA vaccine INO-4700 at ASGCT and are moving forward with our Phase 2 trial in the Middle East. We are the first company with Phase 2 vaccine for the coronavirus that causes MERS which is in the same family of viruses as the coronavirus that causes is COVID-19. Second, we presented positive 12 months overall survival data at ASCO demonstrating an 85% survival rate for our DNA immunotherapy INO-5401 for the devastating and difficult-to-treat glioblastoma multiform. We look forward to the fourth quarter where we will be evaluating and providing at an oncology conference overall survival at 18 months which is the primary efficacy endpoint for the 52 patient Phase 2 trial. Third, we reported positive interim Phase 2 results for VGX-3100 against HPV-related pre-cancerous anal and vulvar dysplasia and we remain on track to report topline Phase 3 pivotal efficacy data for VGX-3100 against HPV-related precancerous cervical dysplasia from REVEAL 1 in the fourth quarter of this year. Fourth, for REVEAL 2, as we mentioned during our last earnings conference call in May, patient recruitment took a hit as a result of global pandemics since the first quarter. Our team continues to work relentlessly on getting us back on track to pre-pandemic enrollment rate in a safe manner and I am confident that we will be in a position to build off of a positive REVEAL 1 data this year. Fifth we're also excited with the progress across our HPV programs particularly for INO-3107 which recently received an orphan drug designation from the FDA to treat the rare debilitating and potentially fatal condition called recurrent respiratory papillomatosis or RRP. We're currently conducting an open-label multicenter Phase 1/2 trial of INO-3107 in the U.S. As we mentioned during previous calls regarding RRP, these patients typically undergo multiple surgeries a year and literally plan their lives around scheduling their surgeries. As such, given the disease characteristics and tighten in community where patients are treated we believe enrollment will be relatively swift and anticipate interim readouts by next year. We also expect to apply for regulatory approval to commence a trial to evaluate INO-3107 in pediatric patients after we had a chance to evaluate data from the current study. Broadening the outreach towards pediatrics will not only build on the overall value of INO-3107, but also provide a viable therapeutic option for these patients who suffer from this rare disease and lifelong surgeries. As this is an open-label trial, we're hoping to have the data to share with you in the second half of next year. Now I'd like to turn the call over to our SVP of R&D, Dr. Kate Broderick, who will provide an update on our COVID-19 program. Kate?

Thank you, Joseph, and good afternoon, everyone. Since I last spoke with you during our May earnings call, we have accomplished a huge amount in the fight against COVID-19 disease. As Joseph stated the key to combat COVID-19 is to continue to build on our understanding of the virus and the disease and have multiple approaches to defeat it. We are very encouraged by the immune responses of our DNA vaccine candidate, INO-4800 and we look forward to beginning our planned Phase 2/3 trials in September upon FDA concurrence. So first, let me begin on where we are as of today. Our manuscript for the initial 40 subject Phase 1 trial in the U.S., which is comprised of week eight safety and immunogenicity analysis, is undergoing peer review process at a top medical journal. Today in our COVID program there have been no safety concerns as per the data safety monitoring board with no serious adverse events reported and only a few mild transient adverse events primarily related to injection-site reactions such as redness. So just to emphasize that one more time, all six related AEs were grade one, the lowest level in severity and this profile compares superbly relative to currently marketed commercial vaccines and also other candidate vaccines being developed for COVID-19. The dataset includes a clinical immunology package, analyzing binding antibodies, live virus neutralization results, T cell responses using both ELISPOT assay and flow cytometry. Unfortunately while I'm currently not at liberty to discuss the details of all these studies until they've been published, I can report that all participants in the trial showed strong antibodies and/or strong T cell immune responses. In terms of the human autoimmune responses, 95% of the participant see to convert and that's defined as those participants who respond with either neutralizing and/or binding antibodies after two doses. In addition, almost 90% of vaccinated participants generated strong T cell responses. Interestingly statistically significant increases in both CD8 and CD4 T cells were noted post vaccination. T cell responses were higher in magnitude than convalescent samples tested and were similar or greater responses to those previously reported for other COVID candidates. Several new recent studies have revealed that a large proportion of the population might possess T cells that could help recognize SARS-CoV-2 despite them never actually having encountered the virus before. These T cells are much more likely generated from previous infections with related coronaviruses, including four viruses that frequently cause common cold. Many experts believe that these so-called cross-reactive T cells may make the COVID-19 disease milder and perhaps partly explained why some people who are infected become very sick while others can be asymptomatic. Leading infectious disease, immunologists believe that vaccine generated specific T cell responses could even be even more helpful than these naturally established cross-reactive T cells in limiting the severity of COVID disease. Therefore, developing COVID-19 vaccines, which could generate strong T cell responses, as well as of course neutralizing antibody responses could ultimately represent better a more efficacious and durable vaccines against COVID-19. As such our promising clinical data demonstrates INO-4800 is a COVID-19 vaccine candidate with a unique, a highly favorable safety profile, which produces well-balanced immune responses, consisting of both neutralizing antibodies and T cells. In addition, the clinical data also suggests a fully boost-able immunogenicity profile with no anti-vector immunity as expected. Our Phase 1 human data build upon our recent nonhuman primate animal challenge study, which is currently the closest thing that we have to testing a vaccine's efficacy when confronting a live virus. As Joseph mentioned, we were very encouraged with the duration of protection that INO-4800 demonstrated, as well as the robust immune response across the antibodies and the T cells, mirroring the impressive clinical data. To give some more context, our challenge study is more stringent than what others have generated to date, as it was performed over three months from the last vaccination and not at the peak of their acute immune responses at one to four weeks post last dose. As such, our challenge study addresses protection from memory immune responses and not from high levels of circulating antibodies present during the acute post-vaccination phase. We also assess the ability of INO-4800 to generate neutralizing antibodies against the newly emerged virus stream G614, which is critical to ensuring that our research keeps pace with the virus as it evolves. And I want to emphasize here that no antibody-enhanced disease events were reported supporting our favorable safety profile. We look forward to reassessing the impact of INO-4800's durability of response at 12 months out, with our other ongoing non-human primate animal challenge studies and we're also pleased to be participating in operation warp speeds non-human primate animal challenge. Finally, we are excited that our expanded U.S. Phase 1 trial is fully enrolled in older subjects and proceeding as planned and our Phase I/II trials in South Korea and China have begun. We look forward to providing data updates on these trials in the fourth quarter. And now, I'd like to hand it back over to Joseph. Thank you.

Thank you, Kate. Great summary. Now I'll turn over to our COO, Dr. Jackie Shea, for our manufacturing update.

Thank you, Joseph, and good, afternoon everyone. First I'd like to take a moment to recap and highlight the unique advantages of our DNA vaccines platform, specific to how quickly DNA medicines can be designed and manufactured, as well as the stability of the products, which are both critical aspects in addressing a global pandemic. In terms of rapid and scalable manufacturing, our DNA vaccine development is achieved via a fully scalable manufacturing process, which are well established. They are cost-effective to manufacture and to produce in large quantities. And very importantly, DNA medicines are also very easily characterized from a manufacturing perspective, much more so than many other biologic products and this facilitates production through multiple manufacturers. As Joseph mentioned, we have an established plan in place for manufacturing at least 1 million 1 mg doses of INO-4800 this year and a target of 100 million doses by 2021. We are also working on further expanding our manufacturing consortium. In terms of stability, INO-4800 does not require frozen shipping or storage, meaning no minus 20 or minus 80 freezers are required. Our vaccine is stable for a year at room temperature or for two months at 37 degrees C and has a five-year projected shelf life when refrigerated. The formulation consists of optimized DNA plasmids, water and salt, with no lipid nanoparticles or adjuvants required, further leading to not only better stability of the vaccine, but also better tolerability when administered. This stability is a unique and important differentiating factor that positions INO-4800 very favorably, when considering the logistics of addressing global vaccination needs during a pandemic. Also as Joseph mentioned, Inovio made significant strides in expanding our global coalition of collaborators, partners, manufacturers and funders to rapidly advance and manufacture large-scale quantities of INO-4800 to meet the demands of this pandemic. So to give you some scale-up highlights, at the end of quarter one the Department of Defense awarded Ology Bioservices an $11.9 million contract to work with Inovio to manufacture INO-4800 for the DoD for clinical trials. In quarter two we also expanded our manufacturing partnership with Richter Helm Biologics in Germany, partially funded through the coalition for Epidemic Preparedness Innovations or CEPI. We are also in the process of finalizing additional manufacturing partnerships in the U.S. and in Europe to fulfill our vaccine candidate production goals of 1 million doses this year, a 100 million next and plan to make announcements about the expanded consortium over the next few months. In addition, we are uniquely positioned with our CELLECTRA smart devices that deliver our DNA vaccines intradermally into the cells, overcoming a key limitation of other DNA and other nucleic acid approaches. CELLECTRA 3PSP is our next-generation smart device that leverages the efficacy and safety track record of an earlier version of the device called CELLECTRA 2000 that has received the CE Mark certification and has been used in clinical trials to safely provide more than 7,000 administrations of Inovio's DNA medicines. The 3PSP has a small footprint. It's similar to the size of an electric toothbrush. And its portable, handheld, battery-powered or rechargeable and very user-friendly, with excellent patient and clinician feedback. Additionally, it's multi-use and able to administer up to 5,000 doses per device. Very importantly, the delivery process for our DNA medicines using the CELLECTRA device is complete in less than 20 seconds and has been described by patients and volunteers in our trials as more tolerable than the standard of flu shot. I'm pleased to report that in late June, we received $71 million in funding from the U.S. Department of Defense to scale up manufacturing of our CELLECTRA 3PSP smart device and for procurement of CELLECTRA 2000 devices for clinical use. Both devices are used to deliver INO-4800 and directly into the skin. The DoD contract builds upon two prior separate five million grants earlier this year from the Bill & Melinda Gates Foundation and from CEPI to accelerate testing of the CELLECTRA 3PSP device. We are extremely grateful for the DoD's commitment and it speaks to the confidence that a major U.S. government entity sees in the value of our smart device and the potential role of INO-4800 in combating an infectious disease pandemics such as COVID-19. Finally, I'd like to reiterate our gratitude to all of our partners, collaborators, manufacturing partners and funders once again, and look forward to sharing continued updates as we scale up INO-4800 production. Now I'll hand back to Joseph.

Thank you Jackie for the update and for your team's outstanding work. Our CFO, Peter Kies joins us now for a review of second quarter financial results. Results I have to add include almost $400 million in cash reserves. Peter?

Thanks Joseph. Total revenue was $267,000 for the three months ended June 30, 2020, compared to $136,000 for the same period in 2019, while operating expenses were $33.4 million compared to $28.3 million for the same period in 2019. INOVIO's net loss for the quarter was $128.2 million, or $0.83 per share basic and dilutive, compared to $29.4 million, or $0.30 per share basic and dilutive for the same period in 2019. It is important to understand that the increase in net loss for the quarter was primarily due to the change in fair value of the derivative liability related to the embedded conversion feature in our August 2019 convertible bonds. This is revalued at each reporting period. Without this non-cash deliberative liability expense, the company's net loss for the quarter would be consistent with the second quarter 2019 and our net loss per share would be $0.20 per share rather than $0.83 per share, which is $0.10 less per share than 2019 for the same period in 2019. Subsequent to June 30, 2020, these bonds were converted voluntarily by the bondholders into common stock. For operating expenses, R&D expenses for second quarter were $22.4 million, compared to $22.5 million for the same period in 2019. Here the decrease in R&D expenses was primarily related to an increase in contra-research and development expense recorded from grant agreements, offset by an increase in drug manufacturing expense related to our COVID-19 and VGX-3100 clinical trials and an increase in device inventory in engineering equipment. G&A expenses were $11.1 million for Q2 versus $5.9 million for the same period in 2019. The increase in G&A expenses was primarily related to an increase in legal expenses, work performed related to corporate marketing and communications and higher non-cash employee-stock-based compensation expense. The end of the quarter cash position included net proceeds of $121.7 million. The company received by selling approximately 10 million -- 12 million shares of its common stock during the three months ended June 30, 2020 under an at-the-market ATM sales agreement. As Joseph noted, we have strong capital resources. As of June 30, cash, cash equivalents and short-term investments were $371.7 million compared to $89.5 million at December 31, 2019. As of June 30, 2020 the company had 158.8 million common shares outstanding and 191.4 million common shares outstanding on a fully diluted basis. This is after giving effect to the second quarter ATM activity, stock option exercises and restricted stock vesting. Additional information is included in Inovio's quarterly report on Form 10-Q for the quarter ended June 30, 2020, which can be accessed on Inovio's Investor page, under the Financial Reports tab. Back to you Joseph. Thanks.

Thank you, Peter. It's certainly great to present our strong financial position. In closing, Inovio is razor-focused on executing the following INO-4800 objectives for the remainder of this year. Number one, advancing INO-4800; two, and conducting Phase 1/2 trials next month, continue to build out manufacturing consortium with several U.S. and European manufacturing partners to meet Inovio's and the world's need for hundreds of millions of COVID-19 vaccine doses; and third, achieving additional external funding for scale-up and manufacturing of vaccine doses. Furthermore, we will round out the transformative 2020 with very important VGX-3100 REVEAL one Phase 3 top line efficacy and safety data, as well as INO-5401, overall survival at 18-month data in the fourth quarter. Everyone at Inovio is committed in bringing these DNA medicines forward with urgency because we know that patients are waiting. Now we will turn to your questions and comments. Operator, please open the line for the analysts.

We will now begin the question-and-answer session [Operator Instructions] And our first question today will come from Gregory Renza with RBC Capital. Please go ahead.

Hey, good evening, Joseph and team. Thank you for taking my questions and congratulations on the progress. Joseph, I just wanted to start with your commentary around the plans for the Phase 2/3 trial for 4100. I'm just curious, if you could perhaps comment on the current gating factors for getting that going. It sounds like you're targeting a September start maybe just a slightly a delay from maybe previous commentary. So I just want to understand maybe what the pushes and pulls are there. And then secondarily, just related to some of the resources or monies that would perhaps be involved to support that and help to execute on that. Thank you very much.

Yes. Thank you, Greg. So we've been working urgently to get our Phase 2/3 event. We are in very active discussions with the FDA on the design and we feel that we are very close to this process. So in terms of drug doses, we have everything available to execute. In terms of the devices we have everything – we have very encouraging and positive Phase 1 data, which is undergoing peer review. So we feel like we are executing on this. Obviously, we are concurrently working on getting an external funding to support this large trial. So please stay tuned because we will be able to certainly by September announce the Phase 2/3 start with external funding in this regard.

That's great. Thank you very much. And then just a quick follow-up on the non-human primate study data. Just how should we be thinking about the length of that follow-up period, as well as perhaps the dose used for the challenge study when comparing that with perhaps other non-human primate studies? Thanks, again. I'll hop back into the queue.

Yes absolutely. Maybe I'll turn to Kate Broderick to handle this question. Kate?

Thanks so much for that question because that gives me the opportunity to really underscore how incredibly important that non-human primate data is. I do want to be clear that at this point to my knowledge anyway, we Inovio and INO-4800 is the only vaccine candidate to show durability in protection from COVID-19 disease. And really that is incredibly important that a good vaccine has to be safe, it has to be effective but also has to have durability. You can only protect for a few weeks or a month but really doesn't have a whole lot of relevance in the situation today. So we are very excited by the data that we just recently released on bioRxiv and I truly think that is going to be important as we survey a lot of people of vaccine candidates which is really much more similar to what would actually happen in real-life as opposed to kind of an artificial situation when you challenge immediately after the acute period of a new responses. I hope that helps answer your question.

Yes. Thanks Kate.

Our next question will come from Stephen Willey with Stifel. Please go ahead.

Yes. Good afternoon. Thanks for taking the questions.

Hi, Steve.

Hi, Joseph. Is there any more granularity you can provide just around expected timing of the Phase I publication? And I guess I think it was noted in the press release that there's -- the study was extended to include I guess more participants raised the age bracket again. But then it also looks like there was a lower dose that was added as part of the study extension. So should we assume that the inclusion of a lower dose implies that there may not have been a clear dose response between the one mg and two mg cohorts? And then I just have a couple of follow-ups.

Let me touch on last part of the question first. No, we do see -- so the Phase I extension studies were done prior to having all of the immune response readouts from the initial 40 person two cohorts. One was that that's the escalation of wage groups that the FDA wanted. So we started with 18 to 50 person cohorts first with one milligram and two milligram doses. And then we have added 51-plus population. We also felt that we wanted to see the overall spectrum of doses coming down to 0.5 milligram as a broad spectrum of dose escalation. Stepping back a little bit but in a pandemic response we're moving very urgently. Those things are done to complete our overall clinical development plan. So we feel that both one-milligram and two-milligram doses are very immunogenic and have shown very strong safety and tolerability, especially when you compare it to already approved conventional vaccines as well as some of the other reports from other vaccine candidates. Back to what -- when you would expect the peer review, I'm urgently waiting as much as you guys are. The peer review process is going to take their own time, but we're hoping that it's sooner rather than later. And all of the humoral and cellular immune responses every detail of safety and tolerability will be outlined in the published paper.

Okay. So I guess should we expect to have that Phase I publication in hand before the decision's announced or before the initiation of the Phase II/III in September?

No. These are two parallel events.

Okay. And then just I guess on the VGX ongoing, I guess litigation or arbitration whatever you want to call it does this impact at all the likelihood of starting a Phase II/III in September? And I guess what are the projected time lines to a resolution here if this does indeed need to be litigated?

So I don't want to go too -- we don't want to go too deeply into actual discussion of the litigation because that's an ongoing process, but I can absolutely say that this or any other litigation has any impact on our INO-4800 development plan including Phase II/III efficacy trials or even the scale-up in 2021 of our goal of reaching 100 million doses. So we feel -- as I mentioned before, we have all the doses and device and race manufacturer to support our trials and our focus is squarely on scaling up for 100 million doses that we feel are needed in 2021.

Okay. And then just lastly and I guess it was kind of asked at the outset, but I guess you characterized the initiation of the II/III as kind of being dependent upon receiving FDA concurrence. I guess can you maybe just talk a little bit about what that FDA concurrence looks like? And should we anticipate that a registrational program here is something like the NIH master protocol?

Yes. So FDA concurrence just means it's an actual term for FDA approval of any process in process steps. Nothing is actually approved. IND isn't approved as concurred you're allowed to go forward. So it's just the terminology. So we could have easily have used colloquial language of, yeah, upon getting FDA okay to move to the next steps. Without getting into details our 2/3 approach is allowing us to quickly go -- get through the Phase 2 portion and getting to a Phase 3 efficacy portion as soon as possible. And that I think we mentioned in a broad brushes previously that it will be a placebo controlled randomized double-blind efficacy trial. So those are -- overall approach will be similar to the other Phase 3 trials ongoing from other groups.

And in terms of patient numbers, should we expect to see a patient number based upon this achievement of FDA concurrence that looks like the NIH master protocol?

Yeah. In similar magnitude, we expect -- it really depends on the actual infection rates at that time. Who we target in terms of higher risk profile, volunteers would also dictate the overall sizing of the sample size, but it will be in the same order of magnitude.

All right. Thanks for taking all the questions.

Yeah. Thanks, Steve.

And our next question will come from Yi Chen with H.C. Wainwright. Please go ahead.

Hi, thank you for taking my questions.

Hi.

Hi, Joseph. My first question is do you follow-up with the original 38 healthy volunteers in the Phase 1 trial just to see how long the antibody and T cell responses can last?

Yes. Currently as we -- in the protocol we have designed to follow-up up to one year after the second dose. So total follow-up will be up to 13th month of the start of the trial both for safety and the durability of the immune response.

Got it. And are the Phase 1 trials in South Korea and China have the same protocol as the U.S. Phase 1 trial? And can you tell us how many patients were being rolled into China Phase 1 trial?

Yeah. So both South Korea trial and China trial of INO-4800, their Phase 1 portions are very much similar to our initial 40% cohort of Phase 1 studies. So it's similar in design. Where it would differ is the intent and the sizing of the Phase 2 portions of those trials. So in China, the Phase 2 trial is estimated to be in several hundred patients, subjects. In South Korea, we're looking to expand into older population in larger numbers. So there -- we're trying to broaden our database of safety and immunogenicity and overall value to the franchise globally.

Got it. And I think you previously mentioned that you would enroll healthcare workers in the Phase 3 trial of INO-4800. With so many candidates entering Phase 3 trials in the second half of this year, do you think there's going to be a competition for enrollment of the subjects in pivotal trials?

Yeah, that's a great question Yi. Certainly I think all of these trials that we're talking about are targeted to be done in the U.S. And with the outbreak situation and such a heightened concerns by everyone in this country and in the world, I don't think we're going to be practically limited by the volunteers available for the Phase 3 trials. Now there are practical eliminations. I think the first six or seven vaccines certainly should have no problem enrolling. If you're the 28th vaccine to get into Phase 3, you may be hitting some of those marginal availability issues. But I think -- I don't expect any challenges in enrolling, because the pandemic is all around us. It's in the news every day and is impacting everyone's life. So I don't think, the enthusiasm for volunteering for these trials will subside in any time soon.

Got it. And lastly, could you give us some color on the enrollment status for the REVEAL 2 trial?

Yes. So the pandemic impact was certainly noticed by our REVEAL 2 trials. Just like all -- everyone else's clinical trials globally, when you're locked down at home it's understandable that you're not going to be able to get to your clinical trial sites and so on. So as all of those of us in the industry are trying to deal with that. We have a very dedicated team and also our CRO who are working literally day and night to make sure that we can continue and perhaps get back to the rates in the levels pre-pandemic. So I don't want to give any quantitative answer here. But what I can surmise here is or summarize here is the pandemic is impacting the enrollment rate, but we're working very hard to ameliorate that as well as possible.

Got it. Thank you.

Yeah. Thank you, Yi.

Our next question will come from Charles Duncan with Cantor Fitzgerald. Please go ahead.

Hi, Joe and team. Thanks for taking my questions, should you leave in interesting time.

Hey, Charles. Yes.

Yeah. Unfortunately, I stepped on to the call late. So I apologize, if some of these questions have been asked. I wanted to first of all get an understanding of when would you anticipate some additional data details from the Phase 1. And then when you consider the Phase 2/3 patient cohort would you include older adults in that study? Or do you have a separate study going on that could read out before then?

Yes, absolutely. In terms of the Phase 1 data we're in the middle of the peer review process at one of the top medical journals. So hopefully, we can expediently get through and present the full publication with all of the detailed safety immunogenicity and tolerability of our Phase 1 data from the first 40 subjects. In terms of the age groups, we really think our vaccine will be quite appropriate for those who are most at risk from COVID-19 disease. So these are older population. These are folks with co-morbidities that may put them at more risk. So in terms of older population, we have already expanded our Phase 1 studies to include them all the way up to 65-plus and we're hoping to have those data in the next one to two months. As for phase -- which isn't predicated on our Phase 2/3. Phase 2/3 will include all age groups including 18 to 50 which was an original cohort and 51-plus as well.

Okay. That's fabulous. And when you consider longer-term safety of any of these COVID vaccines, I guess, I'm wondering when do you think it's best to evaluate that? I know I'm asking you to speculate here, but what would you look for out of longer-term safety? And how will you gain comfort with that for broader licensure and access?

Yes. So if you look at some of the Phase 3 trials that's already ongoing, Moderna's case they have 2-year evaluation period for their Phase 3. I think the safety -- long-term safety could be one to two years in terms of what is the vaccine generated the immune response, what is the impact on preventing infection or preventing disease or impacting the severity of disease which are really the primary and secondary efficacy endpoints. But having a long-term safety that can be followed is also quite valuable. From early clinical trials Phase 1 Phase 2a studies what you focus mostly on are the tolerability acute reactogenicity grades 1, 2, 3 and so on. So what I can touch on here which is really exciting is INO-4800 had as Kate mentioned only 6 related AEs and they were all grade 1 in severity. So this compares extremely well to conventional vaccines as already on the market. But clearly, side-by-side with some of the other candidates they are in Phase 2 and Phase 3 levels against COVID-19. So, if I can stress on what is unique about INO-4800 and really by inference what is unique about Inovio's DNA medicines platform is number one, we can generate both balanced neutralizing antibodies as well as T-cell immune responses; number two, which we saw all participants in Phase 1 either having both humoral and/or T-cell responses which is exciting two; and particularly it's very important that we generate these T-cell immune responses which we're learning more and more every day to be very important against SARS-CoV-2 and COVID-19 disease. And number three, safety and tolerability profile, we think we are second to none; and number four, as Kate alluded to, we think we can boost with INO-4800 for many years. If it came to that. If COVID-19 became a seasonal vaccine addressable disease, we think Inovio's vaccine positioned itself very well due to any lack of anti-vector responses and other toxicity limitations from our platform. And number five, a lot of folks lose sight of this, but our DNA vaccine is extremely stable. Our long-term product storage is at normal refrigeration up to five years. We can keep our vaccine at room temperature for over a year which is a stark advantage compared to some of the other vaccines where the cold chain needs to be maintained in a very difficult and arduous fashion. So, for these five reasons, we think we have a very unique safe and hopefully efficacious vaccine. And these attributes will become even more important we think in groups like seniors who may not be able to withstand some of the reactogenicity and acute tolerability issues that some of these other vaccine candidates have shown in their early trials.

Joe your answer just addressed many of the other questions that I had. I just had two more and I'll throw them into one so you can address those and that is really related to capacity and its capacity not only to conduct a Phase 2/3. And I think you're probably still talking about a 20,000, 30,000-patient study on the upper end but I'm wondering if you could provide some color on that. And then with regard to capacity the other capacity and that is manufacturing some folks have wondered about logistics and manufacturing capacity that you may or may not have and I'm wondering how you solve for that problem and fund it.

Let me touch on the first and I'll refer the manufacturing response to Dr. Jackie Shea. In terms of our Phase - -- Phase 2/3 clinical trials material we already have all of the vaccine doses and devices require for the trial. What we're working on is lining up the external funding to support that and we expect the funding information to be presented around the same time that we get the FDA concurrence to move to our Phase 2/3 trials. So, -- and as far as the manufacturing, we've made huge progress in the past quarter really setting up a manufacturing consortium globally. But let me turn to Dr. Shea for addressing this in detail.

Thank you, Joseph. So, to break up your question into a couple of parts. So, first of all, we already have the doses manufactured that we need for our ongoing clinical studies including the phase -- the upcoming Phase 2/3. And in terms of longer-term supply and being able to build to the hundreds of millions of doses that we would need, we recognize that very early on. As early as January, we recognized that we would have to approach manufacturing in a very novel and very different way. And the same way that other companies have reached out and established manufacturing consortium for their vaccines, we've also taken the same approach with INO-4800. So, some of those manufacturing partnerships we've talked about so Richter Helm and Ology. And over the next couple of months we'll be announcing further manufacturing partnerships and these are partnership based in the U.S. and Europe and we're also now exploring partnerships beyond the U.S. and Europe.

Very good. Thanks for taking my questions. Good luck for the future.

Thank you.

And our next question will come from Aydin Huseynov with The Benchmark Company. Please go ahead.

Thank you. Good afternoon, everyone. Congratulations with the progress this quarter. So first question, I have is about the potential anticipated pricing assumptions given 1 million this year 100 million next year and how close that would be to something that was already announced by the competition.

Well I'm going to also turn this question – this is a very important question and pricing at mass large-scale commercial scale is something that is very important to the world but also important to Inovio. So I'm going to turn over to Jackie in this regard as well.

Thank you, Joseph. I think what I can say about pricing at this stage is that these vaccines need to be affordable and accessible and we're confident at the scale that, we're trying to produce that that we will be in a similar ballpark to many of the other leading vaccines. But I'm afraid at this stage that's all I can say.

Great. I appreciate that. Another question I have is that you mentioned in the press release 100% demonstrated overall immune responses 95% are converted. 90% had T-cell responses including CD8+. Could you give us a breakdown of percentage of patients who show CD8+ responses and how important in your opinion are those responses for this vaccine?

Yeah. A great question. I think the true granular detail you may have to wait for the actual publication post peer review. But what I can tell you is CD8 T-cells are important overall classically as an antiviral response, but specifically also against SARS-CoV-2. We as the field are learning that there's a couple of ways that the body's immune system is responding to an actual SARS-CoV-2 infection. One is through neutrogin antibodies that takes out the virus and limiting the infections and the spread. The other is once the virus is already in the cell, there's only one way to extricate them and those are predominantly through killer CD8 T-cell response with some aspects of the CH1 type of CD4 response. But so in our publication, we have measured in our Phase 1 subjects in terms of the T-cells both the CD8 and CD4 T cell responses. And not surprisingly, we were able to observe strong levels of CD8 T-cell response along with CD4. So these are similar to what we have published in our vaccine against Ebola and MERS and HIV previously. So that part wasn't surprising. I think what we were gratified and satisfied was the level and the fact that we can see it in the COVID-19 setting. So it's very consistent to what we have seen in our previous vaccine trial. So it really goes to the powerful consistencies that we are having across our pipeline efforts.

All right. I appreciate the responses. And another question, I got is so how should we think about annual production of INO-4800 post 2021? I know, it's a little bit early but from a demand and capacity standpoint. And in general, do you think it would be annual kind of repetitive revenue just like production of flu vaccines?

Yeah, I think so. At least in the first several years, I do think this is – it's going to require – but let me put it this way. All of the early manufacturers, who get their vaccines approved, I think we will collectively sell everything that we manufacture globally. And then depending on the durability of the vaccine protective response most KOLs are saying that, it's most likely that vaccine durability is not going to be multiyear long. It would likely mirror the natural infection immune response, which in many cases are only several months when it comes to antibodies. The T cell responses could be more durable. So I think that's where Inovio's vaccine could have some immunologic advantage. But also Kate mentioned – touched on this earlier. We can boost our vaccine almost infinitely. In our cancer therapies and vaccine studies, our patients receive up to a dozen or more doses without any safety or tolerability issues or without any anti-vector response and this isn't something that you can say that with other platforms that are going after COVID-19. In terms of overall production, it's – we're – our immediate goal for 2021 is 100 million doses. As soon as we achieve that consortium manufacturing capacity then we'll go up to 200 million doses and so on. So our current projection is because of our attributes of INO-4800 that I had described earlier, we think we could pretty much sell and supply as many doses as we can manufacture. So our focus where Jackie's teams are truly focused on is how do we get to those hundreds of millions of dose levels both in plasma manufacturing and device and the ray manufacturing and I'm really excited to tell the Street that we're making great progress and we should be able to fulfill our goal for 2021 and beyond.

Thank you. Thank you. And the last question is, if we assume that you're going to start the trial in September, so when do you expect INO-4800 to be approved via probably merge use authorization? What's the earliest that you would think of in terms of approval?

Yes. We think sometime in 2021. The Phase 3 portion, we will likely build in interim looks. So – but also it really depends on the infection rates at the time of our Phase 3 recruitment. The – so all of these things will come into play. But if we sort of transpose what's going on today, where there are quite a bit of infections across the country, if we think this is going to sustain over some time, we think the emergency use authorization through early efficacy look along with immune responses, hopefully having some correlates of that can be generated, immunological correlates we think 2021 sometime is a logical projection for an EUA approval. Actual BLA could take years or beyond that due to the follow-up in safety and all of those things that we touched on earlier.

Okay. Thank you very much for taking my questions.

Great. Thanks, Aydin.

[Operator Instructions] And our next question will come from Naureen Quibria with Maxim Group. Please go ahead.

Hi, Joseph. Congrats on the progress. And I guess most of my questions have been asked but I just wanted a clarification and you've actually touched on this. And that's your thoughts around neutralizing antibodies and T-cell responses with regard to INO-4800. In one of your former press releases you kind of – there was citation of a publication on convalescent data that indicates reduced or low antibody titer. So I was just wondering if you're putting more weight on T cell responses versus the other. Or what are your thoughts on it?

Yes. Thank you, Naureen. The continuing reports from the field, from specialty studying the convalescent subjects tells us that, it's T cells are playing a major factor in limiting the severity of natural infection in these persons and the T cells – the naive person should not having T cells pre-existing in their body. So there was a very important cell paper that came out from the Rockefeller Group and others, continually supporting and there was a publication from China and Europe with similar sets of data showing them. And when you look at USS Roosevelt, where hundreds of sailors were infected, many of them were not positive by antibodies but by PCR. So how can they fight off? How can the asymptomatic person fight off the infection? And there's a lot of suggestion from these studies that says, T cells, cross-reactive T cells as Kate stated in the part of the prepared remarks are likely the causes. And our thoughts are -- we -- it's hard to dispute the importance of neutralizing antibodies, but they don't last for a long time. So we've always maintained that having a balanced vaccine generated immune responses both in neutralizing antibodies as well as CD8 and CD4 T cell responses gives us the best one-two punch to deal with potential infection and COVID-19 disease. And I think the data thus far from our studies as well as the convalescent data coming from the field supports this thesis.

Got it. And then just one quick one. You're also participating in the non-human primate study for operation warm speed. Has there been any guidance to when that data will become available?

When the -- we know the schedules of our non-human primary studies whether this will all be presented together under the hospices of the OWS or not. That's something that we'll be discussing with OWS, but it should be in the next few months.

Okay. And then you have -- obviously INO-4800 has sort of taken center stage and you've got VGX-3100. But are you deprioritizing any other programs because of that?

No. No. And the investor sentiments at least the -- in terms of questions and focus has been around 4800 and naturally understandable. And we are as a company expanding extreme focus and resources on that. But as I touched on my part of the discussions this call, VGX-3100 our pivotal top line efficacy data our first Phase 3 data is coming. It's around the corner and I'm very excited about that. INO-5401, any other year in the absence of COVID-19 pandemic, we will be talking about how amazing the OS12 data was at ASCO. So 85% survival at 12 months compared to mid-60% for standard-of-care. And with OS18, again, around the corner in November at a cancer conference to be presented is very exciting and it's a pretty well-sized study in 52 patients. So we are very excited about that. And I'll be remiss not talking about the -- our orphan designated INO-3107. Again, we think this is a high value to the patients potentially high value to our shareholders as a first non-surgical therapy, if we're successful in getting it to the commercial arena for this horrible disease where patients both kids and adults who are -- who have to undergo multiple surgeries a year. Really designing and scheduling their lives around these procedures is something that I'm very excited that INOVIO is leading the way to provide novel therapies in this regard. I mean, just look at these non-surgical -- first non-surgical immunotherapies for cervical dysplasia anal and vulvar dysplasia, which are horrible diseases on their own, a novel immunotherapy treatment for arguably the toughest cancer to survive from in GBM and then horrible diseases like RRP. I think INOVIO is doing what I have always said and what we have always focused on, which is we have this urgency to bring these products to patients who need them. And I categorically -- uncategorically say, we haven't actually slowed any dose down, rather we have focused and invested heavily into our COVID-19 vaccine. So we're very excited in all of these aspects of what INOVIO is doing, and that's what we're about. We're bringing in new therapies, where there weren't truly true practical solutions for RRP, GBM and VGX-3100 indications. And then on top of that, we're able to surge amazingly to tackle the pandemic of the century. So just like you guys probably are, I would like us to be advancing faster than we are although, we have our team working day at night literally to achieve these things. But I think 2020 is going to be a transformative year, and I said that at the beginning of this year. I still maintain and I would double that down to claim that. By end of this year, we would look back and how important that Inovio's role was in dealing with not just with the pandemic, but all of the other pipeline diseases that we're trying to provide new medicines for.

Got it. Yeah. That's was very helpful. Congrats again on the progress.

Thank you, Naureen.

And our next question will come from Chris Raymond with Piper Sandler. Please go ahead.

Hey. Thanks for letting me ask a question. So I just –

Hi, Chris.

Hi, Joseph. How are you? So I just want to make sure I understand the math. Back on I guess it was the 30th of June you guys in that Phase 1 cohort noted 34 of 36 participants had demonstrated overall immunological responses. And I think I heard you say, it's now 38 of 38. So I guess the question, I just wanted to make sure I understand what's going on with the patient numbers. Did you enroll more patients? Because I think there were a couple of patients as I remember that dropped out because they were COVID positive. Just help us understand the bridge from the dataset on the 30th to now please. Thanks.

Yeah. Thanks for that question. And certainly, this requires some clarification. No, we haven't added any more subjects to the dataset, but we have the luxury of having additional time to rerun those samples, and where samples are unavailable finding the next time point. So looking at holistically both in week six and week eight, we're able to make those response judgments a little more wisely. Now of the 40 one person did drop out totally unrelated to the vaccination or the trial. She just can – he/she can't find the transportation to the sites. So that's one person. And one person did confirm consistently to have at a baseline antibody responses to nuclear protein and other viral proteins indicating that he/she was previously exposed to SARS-CoV-2. All the other 38 people we were able to evaluate their immune responses. So where we have positioned preliminary immune response on June 30 we have a lot more data to be more confirmatory in all 38 subjects who are available for evaluating in this first two cohort study.

So – I'm sorry. So were those COVID positive patients included?

No. One person was confirmed and so we did not include that person into the evaluation, because they had very high baseline immune responses at entry. So one person dropped for unrelated reason, one person was COVID positive. So that's 38.

Oh, I'm sorry your press release on the 30th talk. I think you talked to three patients being excluded due to prior COVID.

So two persons were suspected ended up not being confirmed, so again that's why we say preliminary analysis on those things.

Okay. Thank you.

Yeah. No problem. Any other questions.

Not from me. Thanks.

Great. Thank you, Chris.

And this will conclude our question-and-answer session. I'd like to turn the conference back over to Joseph Kim for any closing remarks.

Great. Thank you very much. We look forward to staying in touch obviously and sharing more updates on our COVID-19 studies, as well as all of the other important milestones including REVEAL and GBM OS18 data. So please stay tuned. Have a great night and stay safe. Thank you very much.

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect your lines at this time.