Inovio Pharmaceuticals Plunges 9.66% as FDA Rejects Drug Approval, Legal Probe Sparks Selling Pressure

The share price fell to its lowest level so far this month, with an intraday decline of 5.92% on January 7. The stock has now dropped 9.66% over three consecutive trading days, marking a significant reversal amid regulatory and legal uncertainties.

The recent selloff follows the U.S. Food and Drug Administration’s (FDA) decision to reject Inovio Pharmaceuticals’ request for accelerated approval for its drug candidate INO-3107, a treatment for recurrent respiratory papillomatosis. While the FDA accepted the Biologics License Application, it emphasized that the company had not provided sufficient data to qualify for expedited approval, forcing Inovio to pursue a longer standard review process. The company has since pivoted to seek alternative regulatory pathways, signaling delays in commercialization and raising concerns about its ability to meet investor expectations.

Compounding the pressure, a securities fraud investigation by Pomerantz LLP has introduced legal risks, with the firm alleging potential misrepresentations by Inovio and its executives. The probe, though still in its early stages, has heightened market skepticism about corporate governance and financial transparency. These developments—coupled with the biotech sector’s inherent volatility—have eroded investor confidence, prompting selling pressure and amplifying liquidity challenges. The stock’s trajectory will likely hinge on Inovio’s ability to address regulatory demands and resolve legal uncertainties, with further declines possible if progress stalls.