What is the expected impact on INO's cash burn and financing needs given the need for larger pivotal trials?

Fundamental outlook:

The Laryngoscope data confirms that INO‑3107 is delivering markedly better durability in RRP—ORR climbing from 72 % to 86 % and CR rates rising from 28 % to 50 % after a second year of treatment. This deep‑stage efficacy should make the drug an attractive candidate for a Phase‑III “pivotal” program and could attract strategic partners or out‑licensing deals. However, a pivotal trial in a rare disease such as RRP typically requires a multi‑center, 200‑plus‑patient study with a 12‑month primary endpoint and extensive safety monitoring. The cost structure for a biotech of INO’s size means that moving from a Phase 1/2 program (≈ $20‑30 M in cash) to a full pivotal effort can push cash burn from a modest $5‑8 M/quarter to $12‑15 M/quarter once enrollment, CRO fees, and site‑management costs are factored in. Consequently, the company will need to raise additional capital—likely through a mix of equity, convertible debt, or a strategic partnership—within the next 12‑18 months to avoid liquidity strain.

Trading implications:

The positive data has already lifted sentiment (70 % bullish) and the stock is likely trading near the recent high, with the 20‑day SMA acting as a support level around $4.20 and resistance near $5.00. In the short term, the catalyst is already priced in; we expect a modest “buy‑the‑dip” on pull‑backs to the 20‑day SMA, but the longer‑term risk is the need for a sizable financing event. If the company announces a non‑dilutive partnership or a successful equity raise within the next 6 months, the stock can retest the $5‑$5.5 range. Conversely, any delay in trial initiation or a weak financing announcement could trigger a breakdown below $4.20 and open a path to $3.80. Position size accordingly and monitor cash‑flow disclosures in the next earnings release.