What happened

Shares of immunotherapy developer Inovio Pharmaceuticals (NASDAQ:INO) rose nearly 28% today after the company published promising data demonstrating that its "universal" flu vaccine could provide broad protection against a specific type of influenza virus. The DNA vaccine was tested in preclinical animal models including mice, guinea pigs, nonhuman primates, and ferrets. 

While the flu vaccine at the center of the study is not among the company's drug candidates at this time, that didn't stop investors from dreaming of possibilities. The results can be viewed as a proof-of-concept for the technology approach and may have implications for rapidly developing broad-protection vaccines against other viruses.

As of 3:19 p.m. EST on Tuesday, the stock had settled to a 23.8% gain.

A businessman holding out his hands with coins and a green chart heading higher.

Image source: Getty Images.

So what

The quest to develop a universal flu vaccine has long been a Holy Grail of medicine and biopharmaceuticals. Did Inovio Pharmaceuticals finally crack the code? Well, not quite. Although the pre-clinical study appears to demonstrate promising potential, it's much too soon to predict the approach will work in humans.

It's also technically not a "universal" flu vaccine. Instead, the vaccine in the study protected against all H1N1 variants of influenza A viruses. While that's one of the most common subtypes of one of the three most common strains of influenza, there are numerous other variants that circumnavigate the globe to wreak havoc on humanity each flu season. For instance, the most commonly deployed American flu vaccine for 2017-18 will provide protection against influenza A H1N1, influenza A H3N2, and one more unusual variant of the influenza B strain. 

Investors can't tell whether or not Inovio Pharmaceuticals' approach could protect against other common influenzas, or whether it would outcompete other proposed approaches to creating a (truer) universal flu vaccine. But it's a start, at least.

Now what

The pre-clinical study published recently provides a promising glimpse at the company's technology approach. However, technology alone doesn't mean much as far as investors are concerned, but is rather just one component to evaluate. Plenty of innovative companies have been tossed into the dustbin of history because they failed to commercialize their technologies or compete in the market.

When other factors are evaluated for Inovio Pharmaceuticals, it's difficult to come away with a very optimistic view of the company. It's set to run out of cash in early 2019. Its lead drug candidate may not have top-line data to report until early 2020. And it has struggled to commercialize products over its life as a company.

Long story short, the "universal" flu vaccine data are intriguing, but right now are nothing more than a lab trick. You shouldn't invest based on lab tricks.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.