Inovio Cuts Q2 Losses by 27%

Inovio Pharmaceuticals (INO 14.09%), a biotechnology company developing DNA medicines, released its second-quarter fiscal 2025 earnings on August 12, 2025. The key news from this release is the continued focus on advancing its lead candidate, INO-3107 for recurrent respiratory papillomatosis (RRP), toward regulatory submission, alongside diligent cost management. GAAP net loss was $23.5 million, or $0.61 per share (GAAP). Analysts had expected minimal revenue of $0.01 million, but no GAAP revenue was reported. Lower operating expenses contributed to a reduced loss compared to the prior-year period. Overall, the quarter reflected operational focus and clinical momentum but continued the pattern of no recurring revenue and ongoing net losses.

Source: Analyst estimates for the quarter provided by FactSet.

Company Overview and Focus Areas

Inovio Pharmaceuticals is a biotechnology company that designs and develops DNA medicines. Its business centers on discovering products that can treat cancers, infectious diseases, and rare disorders by delivering synthetically designed DNA directly into patients. The company is advancing its main therapy, INO-3107, which targets recurrent respiratory papillomatosis, a rare disease characterized by benign growths in the airways, often requiring frequent surgeries as the current standard of care.

Recent years have focused on regulatory approval for INO-3107, progressing device development, and cost containment. Success for Inovio will depend on securing regulatory acceptance, achieving financial sustainability, protecting its intellectual property, and building strategic partnerships to expand reach and resources.

Quarter Highlights and Notable Developments

The period showed substantial cost improvement but a persistent absence of operating revenue. Operating expenses dropped to $23.1 million, a 30.6% reduction for the three months ended June 30, 2025, compared to 2024. Research and development (R&D) outlays fell as Inovio trimmed development spending and managed other costs. General and administrative (G&A) expenses also decreased. Net loss (GAAP) narrowed to $23.5 million for the three months ended June 30, 2025, a 27.0% improvement compared to 2024. This helps extend the company’s financial runway but highlights ongoing reliance on funding rather than product sales.

Diligent cost reduction paired with a new capital raise bolstered liquidity. As of June 30, 2025, cash, cash equivalents, and short-term investments stood at $47.5 million. An underwritten public offering in July 2025 added $22.5 million in net proceeds, extending the projected cash runway to Q2 2026, further underlining the company's dependence on investor capital while awaiting commercial product approval.

Regulatory and clinical progress for INO-3107 continued to dominate Inovio’s activities. The company completed required device verification testing for its CELLECTRA 5PSP device, a key step before submitting its Biologics License Application (BLA) to the Food and Drug Administration (FDA). Inovio confirmed it remains on track to submit the BLA in the second half of 2025, with a goal of FDA acceptance by the end of the year. The FDA also completed its inspection of Inovio’s role as sponsor for the phase 1/2 clinical trial. Durability and efficacy data from the INO-3107 program were positive: 86% of patients experienced a 50% to 100% reduction in required surgeries in Year 2 of the phase 1/2 trial, up from 72% at Year 1, with half requiring no surgeries at all.

Beyond INO-3107, the company advanced its DNA-encoded monoclonal antibodies (DMAb) platform. The DMAb approach uses DNA to encode instructions for making monoclonal antibodies, potentially enabling patients' bodies to produce therapeutic proteins internally. Early-phase results in a proof-of-concept COVID-19 study showed durable antibody production for more than 72 weeks and good tolerability, which supports ongoing investment in this next-generation platform.

The quarter saw no new major strategic partnerships or collaborations established, but management reiterated the importance of existing relationships with industry and academic partners. Outside the U.S., Inovio expressed interest in potential partnerships to bring INO-3107 to other markets in the future. No new developments in its intellectual property portfolio were reported this quarter, but its existing 60 U.S. and 590 foreign patents support ongoing development and future commercial strategies.

In keeping with Inovio’s status as a precommercial biotechnology firm, INO does not currently pay a dividend.

Looking Ahead: Financial Outlook and Company Priorities

Inovio's management did not provide specific financial guidance regarding future revenue or profits, as is typical with companies still in the clinical development stage. The main determinant for future revenue remains the successful regulatory approval and commercial launch of INO-3107, which, if approved, could occur in 2026. The company projects that its current cash, including proceeds from the July 2025 offering, will fund operations through Q2 2026. Projected cash use for Q3 2025 is approximately $22 million, emphasizing continued focus on disciplined spending until any potential revenue stream begins.

As the BLA submission deadline approaches, investors should monitor progress of both the device and confirmatory clinical trial, the company’s ability to secure further partnerships, and response from regulators. The outcome of Inovio’s efforts in the next year will hinge on INO-3107’s approval process, early commercial planning, and the durability of its cost controls. Any delays or complications in regulatory review, partnership execution, or funding could affect the company’s financial sustainability as it moves toward commercialization.

Revenue and net income presented using U.S. generally accepted accounting principles (GAAP) unless otherwise noted.