You can't read an article about Inovio Pharmaceuticals (NASDAQ:INO) without its coronavirus vaccine candidate INO-4800 receiving prominent attention. This article is obviously no exception.

It makes sense why INO-4800 is the primary focus of investors. If the vaccine is successful in phase 2 clinical testing and goes on to eventually win regulatory approval, Inovio will become a much bigger company in a hurry.

But there's one key thing that you might be overlooking with Inovio that could potentially be a game-changer for the biotech.

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In the lead

Based on the extensive coverage of INO-4800, you'd think that the vaccine candidate is Inovio's lead pipeline candidate. But it isn't. That distinction goes to VGX-3100.

Until earlier this year, any discussion of Inovio would have almost certainly centered on VGX-3100. Inovio is currently evaluating the immunotherapy in two phase 3 clinical studies as a potential treatment for human papillomavirus (HPV)-related precancerous cervical dysplasia, also known as high-grade squamous intraepithelial lesions (HSIL).

The company expects to report top-line results from the first of these two late-stage studies in the fourth quarter of this year. Patient enrollment for the second study continues across 43 recruiting sites. The study should wrap up in the first half of 2021. 

Inovio reported encouraging interim results in March from a couple of phase 2 studies evaluating VGX-3100. One of these studies showed promise for the experimental drug in treating HPV-related anal dysplasia. The other study demonstrated positive results from using VGX-3100 in treating women with vulvar dysplasia.  

A big opportunity

Sure, INO-4800 could potentially be used to vaccinate hundreds of millions and even billions of people if it's successful. However, it would almost certainly have to compete against other COVID-19 vaccines. There are at least nine candidates ahead of INO-4800 in clinical testing. 

But VGX-3100 wouldn't have such a problem. There currently aren't any drugs approved by the Food and Drug Administration for treating cervical dysplasia. The only treatment option is invasive surgery.

It's a similar story for anal dysplasia, with current treatments limited to surgical excision, electro-cauterization, or laser therapy. Those alternatives aren't attractive, especially considering that up to half of patients experience a recurrence of anal dysplasia within one year of treatment, with almost 70% experiencing recurrence within three years of treatment.

And there's a substantial market for VGX-3100 if it's approved in the targeted indications. That's especially true for cervical dysplasia, as around 195,000 people in the U.S. and 233,000 people in Europe are diagnosed with the disease each year. Market researcher EvaluatePharma projects that VGX-3100 could generate peak annual sales of more than $600 million if approved.

Risks

Inovio's market cap currently stands at a little over $2 billion. If VGX-3100 goes on to win approval and meet commercial expectations, the biotech stock could come close to doubling based on the prospects for the one immunotherapy alone. And that doesn't factor in the potential of Inovio's other pipeline candidates that have nothing to do with the coronavirus.

There remains uncertainty about how VGX-3100 will fare in late-stage testing, though. Over 35% of therapies targeting infectious diseases that made it to phase 3 clinical studies didn't win FDA approval between 2006 and 2015, according to an analysis by Biotechnology Innovation Organization, an industry trade group. Two-thirds of oncology-related candidates in phase 3 testing failed to secure FDA approval during the period.

VGX-3100 is an immunotherapy that targets precancerous conditions caused by a virus. It's probably safe to assume that the drug's chances of obtaining FDA approval aren't better than 65% or so, using history as a guide. 

Inovio doesn't have a slam dunk with any of its pipeline candidates, but its prospects should improve when you look at all of its shots on goal. INO-4800 gets most of the spotlight these days for the biotech, but VGX-3100 merits attention, too.

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.