Investors who speculated on Inovio (NASDAQ:INO) lost a bundle when the Department of Defense said it would not continue funding the COVID-19 study. This is a major setback for the biotech firm. Moderna (NASDAQ:MRNA) and BioNTech (NASDAQ:BNTX) will continue to grow market share in the vaccine space while INO stock stumbles.
The withdrawal of support for funding Inovio should not come as any surprise. The firm did not get fast-tracked for approval of its vaccine. Now, it will have to rely on the China Advaccine and International Vaccine Institute partnership for the study.
China has no competitive COVID-19 vaccine. It could catch up by funding Inovio and getting its vaccine to market. Investors can only hope this happens. Still, China may want to continue supporting domestic drug manufacturers instead. The Sinovac vaccine is good enough.
Furthermore, the World Health Organization is reviewing them. It may approve them, negating China’s need to invest in Inovio.
Inovio’s failure to get U.S. funding lies in the CEO’s responsibilities. The company did not move fast enough out of the development phase. Its INO 3100 vaccine may get approval. This time, investors should wait for that to happen before buying shares in this company.
