Inovio wins DARPA grant to develop an Ebola vaccine

Government contracts can be the lifeblood for many biotech companies, and when they score a win, the payoff is huge. Inovio Pharmaceuticals can attest to that. Today it won a $45 million grant from the Defense Advanced Research Projects Agency (DARPA) to lead a collaborative team to develop products and a DNA-based vaccine against Ebola.

Inovio is the prime contractor on the DARPA program. Other collaborators are MedImmune, the global biologics R&D arm of AstraZeneca; GeneOne Life Sciences and its manufacturing subsidiary, VGLI; and Professor David B. Weiner, Ph.D., professor of pathology and laboratory medicine at UPenn, Emory and Vanderbilt.

Plans are to dose the first patient with Inovio's vaccine during the second quarter of this year. In preclinical testing the vaccine protected 100 percent of vaccinated animals from death and sickness after being exposed to a lethal dose of the Ebola virus.

"We are advancing against this virus on all fronts," said Joseph Kim, president and CEO of Inovio, in a statement thanking DARPA. The contract represents the largest single grant ever awarded to Inovio, which has previously won two grants totaling $28 million from the National Institutes of Health in 2015.

Fourteen years ago, Dr. Kim left a job developing vaccines for Merck to launch a new company with his former PhD. advisor. Today, Inovio is considered leaderin the vaccine market for its drive to produce DNA vaccines: synthetic, gene-based medicines that train the body's immune system to attack cancers,influenza, Ebola, even HIV/AIDS.

Dr. Joseph Kim, founder of Inovio Pharmaceuticals
Source: Peter Olson
Dr. Joseph Kim, founder of Inovio Pharmaceuticals

"In many ways, the immune system is like an iPhone without any software or apps," he said. "By delivering small snippets of DNA that tell the immune system to recognize a cancer cell or flu virus as the enemy, we can more effectively train the immune system to destroy them."

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If his company is successful in bringing an Ebola and other DNA vaccines to market, it could change the way we think about disease—to say nothing of vaccines themselves. By attacking the disease at a DNA level, an Ebola vaccine could both prevent and treat the illness. Cancers could be cured or prevented with a single, risk-free shot. Public health crises ranging from flu season to Africa's AIDS disaster could be brought under control. Fear-mongering over vaccines and their supposed side effects could be eased. And the financial rewards for Inovio and its investors—the value of the flu vaccine alone is estimated at $4 billion—could be astronomical.

Inovio is just one of several pharmaceutical companies chasing an Ebola vaccine, including Merck, Johnson & Johnson and GlaxoSmithKline. Though several ebola vaccines have been fast-tracked in the wake of the epidemic in West Africa, it's still unclear when any will come to market.

A lifelong pursuit

For Dr. Kim, unconventional medicine has been a lifelong pursuit. "Growing up in Korea, when I was 6 or 7 years old, when my friends would have stomachaches, I would try to pick leaves off trees and grind them down to feed them to try to serve as an elixir," he said. But when his family suggested he become a doctor, he knew that a conventional practice wasn't for him. "I felt like my calling was to be able to treat millions of patients at once rather than one at a time."

Dr. Kim, now 46, was 11 when his family emigrated to the United States, specifically Kansas. Despite not speaking any English, he was in a public school the very next day. At 13, after his parents had established credit, he helped refinance their home with a lower rate. After high school, he won a scholarship to MIT, where he double majored in chemical engineering and economics.

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After graduation, Dr. Kim started working at Merck's Pennsylvania research facility, where he would gain his first experience making vaccines. (He was part of the team that launched the Hepatitis A vaccine in the early '90s.) But work never got in the way of his formal education. In 1994, Dr. Kim was selected for the company's doctoral fellowship program, allowing him to get his Ph.D. in biochemical engineering from the University of Pennsylvania while maintaining his position. And if that wasn't enough, "I also got into and was able to complete an MBA in finance at Wharton school at the same time," he said.

While some might shy away from that kind of workload, Dr. Kim felt he needed degrees from various fields to accomplish his goals. "I always had this vision of combining science and technology with business," he said. "Really great breakthroughs on the bench are useful and fascinating, but I want to make sure you can take those discoveries and develop them into impactful products that can help people."

On a cold, snowy December day in 2000, Dr. Kim left Merck to start the company that would become Inovio. Originally called VGX Pharmaceuticals, the firm was focused at first on working on genomic viruses. "DNA vaccines were not yet ready for prime time," he said, "so we decided to let those technologies percolate."

Unlike traditional vaccines, in which a weakened version of the disease prompts the body to produce antibodies against it, DNA vaccines contain the complete sequence for a specific marker or antigen. When a virus' DNA is introduced into the body, the immune system learns to seek out the disease cells in the body and release T-Cells to eradicate them. Because they are synthetic, such vaccines are more stable and easier to distribute than traditional vaccines. They also carry no risk of infection and don't require refrigeration.

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But for the vaccines to work, they need to piggyback on the protein production machinery inside our cells—meaning, they need to penetrate the cells themselves. Unlike most drugs, the vaccines consist of large molecules, making cell penetration a challenge. It wasn't until about 2006 that Dr. Kim saw a solution.

There had long been a technique called electroporation that uses electricity to make cell membranes more penetrable. For years, it's been used in labs to insert large molecules into cells outside the body. Around 2006, a handful of companies began to perfect a method for performing electroporation inside the body. This was the breakthrough Dr. Kim had been waiting for.

We started to collaborate with a small private company out of Houston called Advisys," he said. "We actually used their devices to deliver our products in animals to kick the tires and really work out the kinks." Soon Dr. Kim determined that this would be the right way to deliver DNA vaccines.

In 2007, VGX acquired Advisys for a combination of cash and equity. Luckily, Dr. Kim had been on a fundraising tear for the previous seven years, raising more than $40 million from a wide array of investors, including Japan's Softbank, Korea Development Bank, the National Institutes of Health and the Department of Defense. "We learned how to be very creative in utilizing our financial resources, saving cash and so on," he said. "So the Advisys acquisition was straightforward."

Two years later, VGX acquired Inovio, which allowed it to effectively corner the market on electroporation patents. "What Inovio had was the breadth and depth of patent portfolio of the delivery system," Dr. Kim said. Upon completion of the merger in 2011, VGX changed its name to Inovio Pharmaceuticals.

Today, Inovio vaccines for treating breast, lung, pancreatic cancer and Hepatitis C are in Phase I clinical testing, and next year its cervical cancer vaccine will begin phase III testing, the final step to FDA approval. And those are just the lead products. Inovio has a vaccine in the works for nearly every disease that hasn't been eradicated by traditional vaccines.

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Not all of those will come to fruition, of course. But as a man who got two degrees when one would have sufficed, and who acquired two electroporation companies when most would have stopped at one, Dr. Kim knows the value of covering his bases. "We always wanted to have multiples shots on goal," he said. "Not every product is going to work, so we want to make sure our shareholders' risks and benefits are well managed and that we ultimately bring the best therapies to patients."

—By Douglas Quenqua, special to CNBC.com