How the Inovio Secondary Crushed Its Shareholders

Inovio announced that it priced a secondary underwritten offering of 9.5 million shares of common stock for a price of $8.00 per share. The proceeds from this offering are expected to be about $76 million before deducting the underwriting costs.

The company has granted to the underwriters an option to purchase up to an additional 1.425 million shares of common stock. The offering is expected to occur near May 5.

Piper Jaffray and Stifel are acting as joint book-running managers for the offering. H.C. Wainwright, Brean Capital and Maxim Group are acting as co-managers of the offering.

The proceeds from the offering will be used for general corporate purposes, including clinical trial expenses, research and development expenses, general and administrative expenses, manufacturing expenses and potential acquisitions of companies and technologies that complement its business.

Inovio is a clinical stage biopharmaceutical company that develops active DNA immunotherapies and vaccines in combination with proprietary electroporation delivery devices to prevent and treat cancers and infectious diseases. It has completed, current or planned clinical programs of its proprietary SynCon immunotherapies for HPV-caused pre-cancers and cancers, prostate cancer, breast/lung/pancreatic cancer, hepatitis C virus, hepatitis B virus, HIV, influenza and Ebola.

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Inovio has a collaborative development agreement with GeneOne Life Sciences to co-develop an Ebola vaccine through Phase 1 clinical trials. Inovio was founded in 1979 and is headquartered in Plymouth Meeting, Penn.

Shares of Inovio were down about 14% at $8.40 just after Thursday’s opening bell. The 52-week trading range is $6.33 to $14.20, and the consensus analyst price target is $20.80.