It seems like a long time ago that Inovio Pharmaceuticals (NASDAQ:INO) was considered a leader in the race to develop an effective coronavirus vaccine. The biotech was soundly defeated in that competition, and while it is trying to play catch up, other players have already racked up billions in sales from their vaccines.

Unsurprisingly, investors mostly gave up on Inovio, and its shares have lost more than half their value in the past 12 months. But some recent developments could help Inovio stage a rebound -- and if it does, its shares would be a steal at current levels. Can Inovio pull off a comeback?

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What would it take?

Inovio hasn't given up on its COVID-19 vaccine program, but the biotech can't conduct a phase 3 clinical trial for INO-4800 in the U.S. at the moment. The reason? In September 2020, the U.S. Food and Drug Administration (FDA) placed the phase 3 portion of Inovio's phase 2/3 study on clinical hold because of concerns regarding the company's Cellectra 2000, a proprietary device it uses to administer the vaccine.

Inovio is free to run clinical trials elsewhere, though, and it is partnering with vaccine maker Advaccine Biopharmaceuticals Suzhou to do so. The two companies plan to start the phase 3 portion of Inovio's phase 2/3 clinical trial for INO-4800 in several countries in Asia and Latin America by the end of the summer. The study will evaluate the efficacy of a two-dose regimen of the candidate, administered a month apart, in participants aged 18 or older.

It's worth noting that there's still a large opportunity, particularly in developing countries, for an effective coronavirus vaccine, and Inovio is looking to tap into this market. The company is also going after the newer variants of the SARS-CoV-2 virus that causes the disease. Some of these variants are spreading rapidly, especially the delta variant

Patient getting vaccinated by doctor.

Image source: Getty Images.

In May, Inovio reported positive results from pre-clinical studies for INO-4802, a candidate it is developing to target these variants. According to the biotech, INO-4802 could potentially offer broader immune responses than other vaccines. If we are to believe the claims that COVID-19 is here to stay and will become a seasonal illness like the flu, Inovio's current efforts, if successful, could still pay off down the road. 

Inovio also has other promising programs in its pipeline. These include VGX-3100, a potential treatment for a human papillomavirus (HPV)-associated precancerous condition called cervical dysplasia. The only current treatment option for this illness is an invasive surgical procedure. The annual incidence of cervical dysplasia is an estimated 233,000 people in Europe and 195,000 people in the U.S. VGX-3100 is currently undergoing a phase 3 clinical trial.

Inovio has other potential medicines or vaccines for several forms of cancer, Ebola, HIV, and more; most of these are still in their early stages of development. If the company's INO-4800 and INO-4802 pan out, and if it can capture a decent share of the coronavirus market in developing countries, investors will reward the company and send its stock price higher. VGX-3100 could also become a key growth driver for Inovio if it is approved. 

How likely is a rebound?

Inovio is subject to the same risks as other biotechs, including failure from clinical trials and regulatory setbacks. In fact, regulatory setbacks played a big role in sending the company's shares down in the past year. While the vaccine maker does seem to have a clear path to riches from here on out, it would take a series of successes for that goal to actualize. Is it possible? Yes. Is it plausible? In my view, not very. What's more, investors should weigh the risk-reward profile of Inovio against some of its peers. 

The coronavirus vaccine market in developing countries may present a big opportunity, but by the time INO-4800 makes it to the market -- if it goes that far at all -- other companies will have likely already made some headway in those countries. And while variants of concern do present serious risks, companies such as Pfizer and Moderna are also working on various ways to deal with them. Considering all these factors, Inovio doesn't seem like a buy, even after losing more than half its value.

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.