What happened

You might call it a case of coronavirus stock mayhem. Shares of Inovio Pharmaceuticals (NASDAQ:INO) were soaring 14.8% as of 10:38 a.m. EST on Tuesday. At the same time, shares of two other biotechs that are developing experimental coronavirus vaccines, Moderna (NASDAQ:MRNA) and Novavax (NASDAQ:NVAX), were sinking by 7.5% and 12.3%, respectively.

These moves were caused by the same news. Inovio announced before the market opened on Tuesday that it was accelerating the timeline for developing its DNA vaccine INO-4800 for COVID-19, the disease caused by the novel coronavirus.

Inovio plans to begin human clinical trials in the U.S. in April, with clinical trials following shortly thereafter in China and South Korea. The results are expected to be published in the fall of 2020. Inovio plans to produce 1 million doses of its experimental COVID-19 vaccine by the end of the year.

Coronavirus vaccine bottles

Image source: Getty Images.

So what

It's pretty clear why Inovio stock jumped on the news of its accelerated COVID-19 vaccine schedule. It also makes sense why shares of Moderna and Novavax would drop.

The first company to develop a safe and effective vaccine for COVID-19 will likely rake in sales as countries across the world stock up on it. Companies that are later in developing COVID-19 vaccines could find themselves largely left behind.

Moderna announced on Feb. 24 that its coronavirus vaccine mRNA-1273 was ready for human clinical trials. The biotech stated then that vials of the vaccine had already been shipped to the National Institute of Allergy and Infectious Diseases (NIAID) for use in a U.S. phase 1 clinical study. Two days later, Novavax announced that it plans to begin a phase 1 clinical study evaluating a nanoparticle-based COVID-19 vaccine in the spring of 2020. 

All three of these small biotechs appear to be in a close race. Inovio's projection that it will produce 1 million doses of INO-4800 by the end of 2020, though, seems to have given the company at least a slight lead in the eyes of investors.

Now what

There's one thing that investors can almost certainly count on: All three of these biotech stocks will remain highly volatile. Positive news from one company will boost its shares and cause the other two stocks to decline. But the situation could change quickly with good news from another biotech. Keep in mind that other big drugmakers are also working on experimental COVID-19 vaccines. 

Instead of focusing only on the coronavirus prospects for these biotechs, a better approach is to look at the companies' overall prospects. For example, Inovio's lead pipeline candidate is VGX-3100, a drug targeting cervical dysplasia. Moderna is evaluating its experimental cytomegalovirus (CMV) vaccine mRNA-1647 in a mid-stage clinical study. Novavax expects to soon report results from a late-stage study of its flu vaccine NanoFlu.