Greetings, and welcome to the Inovio Pharmaceuticals Fourth Quarter and Year End Financial Results Conference Call. At this time all participants are in a listen-only mode an interactive question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded. I'd like to turn the conference over to your host, Mr. Jeff Richardson. Thank you. You may begin.

Good afternoon ladies and gentlemen, thank you for joining us today. Today’s call may contain certain forward-looking statements relating to our business, including our plans to develop DNA immunotherapies and electroporation-based delivery technologies, products and product candidates as well as our capital resources all of which involves certain assumptions, risks and uncertainties that are beyond our control, and could cause actual results to differ materially from these statements. A description of these risks can be found in the latest SEC disclosure documents and recent press releases. These statements speak only as of today’s date and we undertake no duty to update or revise them. Presenting today are Dr. J. Joseph Kim, Inovio’s President and Chief Executive Officer; and Peter Kies, our Chief Financial Officer. Now, Dr. Kim.

Good afternoon everyone. I’ll start by saying that I expect 2017 to be an excellent year for Inovio. Building on key accomplishment in 2016, there are three reasons for this. Number one is clinical trial data, in just to last half year, we announced encouraging new human data from our head and neck cancer, MERS and Zika immunotherapy and vaccine. You can expect clinical data from six of our cancer and infectious disease program in 2017. We expect to see our MERS and Zika data published and we were also report on clinical trials for Ebola, Hepatitis B, HIV and prostate cancer. Number two, we are initiating important clinical studies including our Phase 3 program with VGX-3100 and two separate immuno-oncology combination study. In 2016, after extensive preparation, we were ready to start our Phase 3 study of cervical dysplasia in the fourth quarter of last year. The FDA asked us to submit additional information regarding our brand-new delivery device which has not previously been tested in a clinical study and placed a program on clinical whole before it was started. We are preparing that response and expect to be able to initiate Phase 3 activities in the first half of the year. We also look forward to initiating two separate cancer trials that combine an Inovio multi-antigen DNA immunotherapy with a checkpoint inhibitor which could create an all-important one-two punch with the potential to take the valuable data outcomes achieved by the checkpoint inhibitors alone to a whole new level. These efficacy measuring cancer studies will place Inovio as a unique player on the immuno-oncology map. Finally, number three is the potential for more business development steps. In the fourth quarter alone, we announced $15 million in non-diluted grants being awarded to fund Inovio programs for MERS and Zika…

[Multiple Speakers] questions.

So kindly there was a technical issue with the recording, so I am going to step back and repeat this call little bit from where it's cut out. So please bear with us. First, let me speak about data. The news has arrived that our data on two infectious disease vaccine at a single Global Safety Conference that is the correlation for Epidemic Preparedness Innovation which has been fully funded by the Gates Foundation, Inovio's data on Zika and MERS was most talked about presentation. Why? Because we reported that in a Phase 1 study of our Zika vaccine GLS-5700 after our three-dose vaccine regiment, high levels of antibodies were measured in 100% of the 39 trial subject, again it was 100% and we are highly confident that the level of antibodies and response rate in humans to date suggest a potential for a proactive [ph] vaccine. At that conference, we also reported that in our Phase 1 MERS study of 75 subjects, high levels of antibodies from GLS-5300 were measured in 92% of the participants. In addition, 98% of the subjects generated an antibody or a T-cell immune responses. Again, the data points to the potential providing preventive benefits. These Zika and MERS vaccines were well tolerated and there were no safety concerns. These studies and initial data are unique in the world. They represent first, and we expect this data to be published in major scientific journals in the coming year. During the balance of this year you'll also see clinical data from three more infectious disease trials, from our expanded Ebola vaccine trial as well as HIV vaccine study and our immunotherapy trial to treat hepatitis B, INO-1800. Speaking of our hep B therapy, the 90 patient global Phase 1 study for INO-1800 just completed enrollment. We…

Thanks Joseph, so this has been a growth year for Inovio. Our headcount increased from 150 employees at the beginning of 2016 to 260 as of the end of February of this year. This growth was primarily in our R&D, engineering and manufacturing groups. These steps increased our operating expenditures and for the year ended our net operating burn was just over 62.5 million. We will continue to benefit from many Inovio products been advanced with the benefit of non-dilutive third party funding and we will continue to seek these types of relationships that contribute both human and financial resources. During the year, the company sold 658,748 shares of its common stock under its ATM sales agreement for net proceeds of 6.3 million with an average price of $9.75 per share. As of December 31st, cash and cash equivalents and short term investments were 104.8 million compared with 163 million as of December 31, 2015. As of December 31, 2016 the company had 74.1 million shares outstanding and 82 million fully diluted. We anticipate under our recently established collaboration with ApoloBio Corp and in conjunction with the clinical hold lift, payments to Inovio of 50 million consisting of an upfront signing fee, plus up to 35 million in equity investment will be completed by the end of the second quarter. Joseph, back to you.

Thanks Peter and sorry everyone for our technical difficulty here. But the key point I want to leave you with is that we and our DNA based immunotherapies and vaccines are in the conversation around the table at big pharma giants, government medical groups and NGOs. We are in those conversations because of our data, because of the development milestones we reached and because we fit well with other emerging technologies like checkpoint inhibitors to increase their power to fight disease and raise their response levels and to potential save more lives. This has always been Inovio's primary mission. With the accomplishment of the past six months as well as what we expect in the next six, I believe we will have a vital critical mass of development positioned for many new successes. Thank you for your attention. I am pleased to take any questions that you may have.

Thank you. [Operator Instruction] Our first question comes from Tom Shrader from Stifel. Please go ahead.

Hi, Joseph and team this is Alex Schwartz filling in for Tom Shrader. Congrats on the continued progress. I had a few questions if you will. So far I know you have reported some good immunogenicity data with your first Zika vaccine trail, transitioning to your additional Zika vaccine trial in Porto Rico, what endpoints are you going to report and kind of looking at prior attempts with stained vaccines and other related Zika viruses, is there any sense of good data might look like kind of this early in clinical development?

Yes Alex, thanks for the questions. Certainly, our first 40 subject study in North America, we had a 100% response rate, so I guess that I think had a very good end point and immune responses reports. We also expect to see in our Puerto Rico study which is designed slightly differently with 80 persons receiving our vaccine and 80 getting placebo and it's randomized in a highly endemic area in the island of Puerto Rico. We have an exploratory endpoint in addition to our normal typical Phase 1 endpoints of immune responses in safety of efficacy. So it's powered to have an early look into efficacy. So as you said Alex, we expect our Zika program to continue to remain at the first. We were the first vaccines to go into the clinic. We were the first through the FDA and we were the first to report positive 100% data from our clinical studies and we continue to look at our clinical program and as the first to perhaps get an exploratory look into an efficacy of this vaccine. There are other hybrid work that we're also doing, such as being able to take the patient serum with positive antibody and then we can cut those serum into animals to have an animal Zika infection challenge study and so these are all various exciting data points that we could report in the coming year.

Two more questions if you will, the first one, you may have talked about this but with the technology difficulties maybe I didn't hear it, was the combination trial of INO-5400 and checkpoint inhibitors, have you publicly announced what indications you'll be targeting or can you talk about some trial design and endpoints you're looking at in the study?

We haven't disclosed those details about that. What we have talked about thus far is INO-5401 is comprised of WT1 and hTERT and PSMA are top three of our cancer antigens that we have in our arsenal all combined to one. We'll also add our IL-12 immune activator as well as a checkpoint inhibitor from a partner or a collaborator from the get-go, and because WT1, hTERT and PSMA, these antigens are expressed in not just one type of cancer but multiple types of different cancers we actually see this INO-5401 as a potentially universally adaptable cancer immunotherapy and a first study we'll disclose them, which type of cancer we're going after and all those information will be forthcoming in the coming quarter. But that, we're so excited about that. 5401 really is for our program and our team to be shooting for the fences. We feel that we've gathered just a wealth of immune data from our clinical studies both from the IV as well as in our cancer studies and now we are, in addition to 3112 going into combination with MedImmune, we're really very excited about INO-5401 as the major thrust into immuno-oncology by Inovio.

Okay, very good. And then my last question is, on the previous earnings call, you talked about cash burn rate for 2017, it seems pretty lower implied some financial milestones for the year, can you talk about what milestones you are expecting this year and what potentially are you eligible to receive?

Well, obviously what we already discussed about milestones and deal revenues or money coming in. ApoloBio, we already talked about, we expect once our Phase 3 clinical hold is lifted there is a mechanism in place, an agreement that we had previously announced, where $15 million in cash signing plus milestone at the time of clinical hold lift and 35 million in equity investment from ABC. We expect to have additional product development base milestones from MedImmune and other efforts that we have ongoing. In terms of the cash projection, we expect around $60 million to $65 million net burn in the coming year.

Okay, very good. Well thanks for additional color and congrats on a continued progress.

Our next question is from Charles Duncan from Piper Jaffray. Please go ahead.

Obviously, a lot going on, it would be really great if we could type out these calls going forward. I am kind of wondering if you think about what could happen in 2017, what do you think is going to be the most remarkable thing that you do, when we're talking about this in a year. I got to say that it's been a full nearly three years since your initial data in surgical dysplasia and it would be great to see that finally make some progress, but in your mind what do think is going to be the greatest achievement for the company this year?

I think the greatest achievement is getting our Phase 3 started and I agree with you, I have been [ph] patient as anyone to get this great VGX-3100 product Phase 3 going. So we expect to get that started into first half and we expect to hit the ground running with enrollments. So as the lead product and as the only Phase 3 program in the company we expect things in the next 12 months. On top of that there are two cancer studies that we are very excited about, 5401 that we are driving and 3112 that MedImmune is driving. They are both efficacy studies, they are both end points with overall and progression free survival built in. We think each of these programs will make a huge stand in the respective cancer indications specifically, but in more general, I think both of those, once we can impact antitumor and survival benefits, we'll be able to overall generally speak to the power of our T-cells generating products, whether it's 3112 or 5401 or other programs that are coming through our R&D pipeline. So I think both of those studies will be very impactful. And lastly, I think our infectious disease both Zika and MERS, I fully expect that we'll be on our way to a Phase 2 efficacy study for Zika and hopefully with a lot of backing of both national and global health agencies, so I'm very bullish. I think we're the only game in town in terms of Zika vaccine clinical data and I think our data that was presented at Safety and what we see is quite significant and impressive and all the other things that we see. But those four things are I think are the most important.

Joe thanks for answering that question and where it still bought into the broader applicability and differentiation of the platform, but if you expand to 3100, given the timeframe that has been -- has gone by, I agree with you it's very important as a lead candidate to get that right especially with the regulators. I'm wondering if you have had any new evolution of thought in terms of clinical trial design or could you just remind us how you're thinking about that clinical trial and is there any way to recapture some of this lost time?

Well, we can't recapture the time that's lost. But what we can do is we're doing everything we can prior to the patient enrollment to accelerate the uptake of these sites around the globe, so we're doing everything we can operationally to make sure we can hit the ground running once the hold is lifted, and as far as -- this has been an all hands on effort by our team so our regulatory clinical and engineering teams have been working hard to get a very satisfactory complete response back to the FDA and I have no doubt we'll be able to achieve that in the first half of this year.

Is there any additional color you can provide on the nature of the complete response letter, was it I guess kind of [indiscernible] like in that required maybe some additional validation, or was it doing some kind of experimental or experimentation on the design or functioning of the device? I understand that isn't above the drug, but it's a something that you're waiting to see the results from to be able to move forward or is it a more [indiscernible] like?

Well what I can tell you is and what we've shared publicly is -- was additional information that was requested, some of those required additional testing of the device and we've been able to execute that. Obviously, we would -- we are doing everything that we can do meet all of the requests and the questions and comments the first time, and all I can say is we have a comprehensive effort to move this forward. There is no one else on this planet that wants to get this study started than myself. So -- and singularly our team has the same vision and objectives, so I am very blessed with having a great hardworking and highly efficient team and that’s going to execute as we planned. All along we said that’s we'll be -- we projected that this will be our first half '17 event. And we have -- I have no doubt that we will be able to hit that in the first half of this year.

Appreciate that. Last question I had is regarding the device is, the new device design, the way it works, any aspect of it? Does that bear on any of the utility of the data that you generated in the past? I mean how should investors think about the predicted value over the past results, say you've generated. Which we were pleased with at the time, we're going to have to dust it off to remind ourselves of that as we think about your new study, but any way to gauge profitability of success differently or newly with this new device?

Yes, I think the predictability between our Phase 1 and 2 devices to our commercial device should be highly linear. As I previously stated in calls before, we wanted everything that interfaces with the patient regarding the needle, the delivery, pulses to be identical to previously. So the form and function of what the patient feels is the same and what the immune system of the patient sees should be the same, that’s how we will design, everything else in the backend, including the ease of use, sophistication of automation and so on reproducibility, the manufacturing had all of the commercial aspect issues designed into it. So I would say it's fully scalable and translatable from our previous data to going forward.

Okay, thanks for taking my questions.

Our next question comes from Yi Chen from Wainwright. Please go ahead.

Regarding the Phase 2 trial for vulvar intraepithelial neoplasia, do you plan to initiate this trail after you initiate the Phase 3 trial of VGX-3100, what's your expected cost of this Phase 2 trial and also how big is the market for this indication out there, and does the patient population overlap with those cervical dysplasia patients?

Brilliant question. First, the VIN trial is totally decoupled from the CIN trial in terms of the timing, obviously, it's the same biologic product, but the Phase 2 will be conducted with our Phase 2 device, so there's no limitations for studying that trial. So, VIN Study Phase 2 is on its own timeline. We've said that we'll start that in the first half of '17 and so that's independent of our Phase 3 CIN 2/3 trial. Now the other part, the VIN indication, the total number of patients are smaller, it's probably about 10 fold smaller than the CIN 2/3 but it's highly identifiable market with really undesirable treatment options, which is surgery, which is highly disfiguring, painful, and stressful because of the aspects of what the surgery does to the organs. And to make that even worse about half the patients have to go through their treatment again. So their recurrence rate is extremely high. And because the number of patients are smaller we fully expect to achieve orphan indication designation for the VIN indication here in the U.S. and Europe and abroad. So, we think -- not to take you away from our CIN 2/3 market, we think VIN is a very attractive market for us to add-on to our CIN 2/3 indication. So, this has been our systematic approach to expand and maximize the market potential of VGX-3100, and I haven't talked too much about this but we'll also go into anal intraepithelial neoplasia, again highly underserved market where surgery is just unthinkable and side effects and recurrent. So, that's our goal. We want to own, Inovio's goal is to own all therapeutic markets after the patient is infected with HPV. So in the precancerous indications like CIN, VIN and AIN Inovio will develop these markets on our own overall and with regional and smaller partnerships like what we're doing with ABC, in China, and then cancers caused by HPV, while there we've already partnered with MedImmune to go after using 3112 with -- along with their checkpoint inhibitors. So, I think we will be very dominant in post-HPV infection therapeutic markets.

Our next question comes from Jason Wittes from Aegis Capital. Please go ahead.

Just a question on the checkpoint inhibitor trials. It seems to me as you mentioned a lot of these checkpoints are coming from commoditized and I completely understand the potential mechanism here where you could boost the effectiveness, but do you anticipate there'll be any difference between one checkpoint inhibitor to another in terms of how it reacts to the vaccine or is it also a case of for labeling reasons anyone who wants to get that boost is going to have to do some kind of trial to get on the market?

Yes Jason, very good question. We have the same question and I can't speak for the FDA or the other regulators, but I mean my scientific view of the PD-1 and PD01 inhibitor is out there, they are pretty much -- they all work in a similar fashion, there are some distinct differences, but I think the difference is are out way by the similarity. And what's clear is having an active T-cell infiltrated in the tumor is going to be a very important prognosticator of patient's responsiveness to an overall immunotherapy. So I think it's positions Inovio extremely well, whether we partner with one or two or more of this global PD-1, PD01 developers. We do control a very important aspect of T-cell generation.

Okay, that’s helpful. And then you mentioned 60 million, 65 million that is net of all the milestone payments in terms of the cash burn that you anticipate for '17?

At the current time and that also is net of all the revenues from our grants and contracts and other partnership revenues that we have brought it in the past.

Okay and then as you mentioned sometime in the first half you will start the Phase 3 trial for VGX-3100, can you just remind us again how long do you think it will take to enroll that trial?

We expect around two years all in.

Okay.

And obviously, we we'll -- we are looking to tighten up the timeline of course.

And I guess you have already kind of set the parameters for that, I think there was a question earlier about this, was there any opportunity beforehand to potentially increase the number of sites or is that just not something that you're planning doing at this point?

We are doing everything that's feasible under the rigs for us in terms of contracting all the paper works been getting done, so we really will hit the road running, once the -- and I say once, once the hold is lifted from this program.

Okay, that’s helpful, thank you very much.

Our next question comes from Jason McCarthy from Maxim. Please go ahead.

I just -- I haven’t heard it in a little while and I wonder if you can give us an update on the DNA based molecules, which I always found really intriguing, I think we've discussed it before, the possibility of making your own checkpoints and even using neutralizing antibodies in infectious disease. Can you give us an update of when we might see some more progress in those programs? Thanks.

Absolutely, that DNAs [ph] are one of the most favorite development program of ours. Certainly, with all of the actions that we have in clinical studies moving into Phase 3 and moving multiple Phase 2s, at least three Phase 2 program in 2017. Some of the earlier a game changing developments are getting less air time here. But I would not undersell the leaps and bounds of development that we're doing with the DNA. Obviously, our last Gates Foundation grant that we received in December of about $9 million between us and our collaborators was directed to making a Zika DNA and we've other infectious disease DNA that we have been researching and developing through animal testing. I expect there should be about half a dozen publications this year just pointed towards our cancer and infectious disease DNA, so these are significant animal modules, perhaps game changing effects in animals, and we have plans to take one of these products into our first clinical evaluation within the next 12 months. So, most likely our Ebola DNA that's funded with DARPA funding and through clinical evaluations, but I won't be surprised if you hear more additional funding or additional development in the DNA area, as you said Jason this is a very hot and very focused area where you can imagine having each person being able to express their own minocromil antibodies. We would be able to take a huge fight into this market where last year the Big Pharmas have sold more than $50 billion as a class of drug. So I can tell you this, you will definitely hear more about our DNA development in 2017.

Thank you. This does conclude the question-and-answer session. I'd like to turn the floor back over to management for any closing comments.

Well thank you very much. We look forward to all of the milestones and catalysts that I have set forward and we think this is going to be an extremely productive year. Thank you.

Thank you. This does conclude today's teleconference. You may disconnect your lines at this time. Thank you for your participation.