Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of Inovio Pharmaceuticals (NASDAQ:INO), a clinical-stage developer of synthetic vaccines and immunotherapeutic products to fight cancers and infectious diseases, dipped as much as 13% after the company reported its first-quarter earnings results before the opening bell.

So what: For the quarter, Inovio reported $2.4 million in revenue, up 60% from the prior year period where it delivered $1.5 million in revenue. The primary boost came from development fees associated with its Roche collaboration that totaled $1.4 million. But Inovio's operating expenses rose 53% to $12.4 million from $8.1 million as research and development expenses jumped 61% to $8.2 million. Net loss for the quarter widened by $2 million to $10.8 million, or $0.05 per share, from $8.8 million, or $0.04 per share in Q1 2013. As Inovio notes, the difference was an increase in noncash, stock-based compensation. Comparatively speaking, Wall Street was looking for a narrower loss of $0.04 per share.

Now what: Although Inovio ended the quarter with $116.8 million in cash, cash equivalents, and short-term investments, which was more than double what it had in the sequential fourth-quarter, investors are clearly concerned with the potential for cash burn moving forward given that much of Inovio's research is in the early stages, or preclinical, stages of development. This doesn't mean Inovio's pipeline hasn't shown early stage promise, but the eventual failure rate of early stage therapies is still pretty high even if phase 1 studies look encouraging. While Inovio has landed an elephant in Roche, I would still suggest sticking to the sidelines until we have more concrete data to trade off of than simply safety and tolerability results from its early stage studies.

Sean Williams has no material interest in any companies mentioned in this article. You can follow him on CAPS under the screen name TMFUltraLong, track every pick he makes under the screen name TrackUltraLong, and check him out on Twitter, where he goes by the handle @TMFUltraLong.

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