The 2020 pandemic hit many companies hard, while other companies took it as a chance to grow, seemingly unaffected by the state of the world around them. NVIDIA (NASDAQ:NVDA) came out as one of those thriving businesses and achieved gains of 122% in 2020. The company’s graphics processing units (GPUs) were present and needed for trends that accelerated exponentially due to the pandemic, boost...
Ocugen (NASDAQ:OCGN) had started initially trading as a penny stock for $0.28. However, after it announced a partnership with Bharat Biotech to commercialize its COVID vaccine in the U.S., its shares increased significantly.
Scratch that. That was the understatement of the century. On December 1st, Ocugen stocks traded for pennies. Now, they are up 3,320%.
Is this a reason to invest in Ocugen? Does it have room to grow?
The Barat Biotech COVAXIN is different from other vaccines in terms of protecting people against viral antigens. During analysis of phase 3, more than 75% of patients who received two doses of the vaccine developed immunity up to severe cases of COVID-19.
Patients in India saw exposure to the new mutant COVID-19 strains circulating in the country. Since the latest strain is more resistant to antibodies than the original strain, it is very promising that COVAXIN managed to keep up its efficacy.
COVAXIN can last up to three months at room temperature, making it an excellent option for easy transportation.
It is currently authorized for use in India, where nearly 300 million doses have been supplied up until today. Bharat Biotech has requested aid from Ocugen to make their vaccine available in the U.S. Ocugen expects to receive emergency authorization from the FDA by June.
What’s the catch?
While a deal this big may sound tantalizing for investors, they need to remember that Ocugen does not own COVAXIN, it owns its licencing rights, and that is for U.S. only.
That might be an issue. The Biden Administration has already ordered enough doses to vaccinate their population at least four times. They are on track to complete the vaccination program by the time July ends.
This is the classic case of coming too late into the game. The vaccine is bound to receive a green light, but it is still up to debate whether this is a solid investment.
Ocugen is losing over $20 million a year, with only $27.4 million in total assets. If the company is too dependent on selling COVAXIN on U.S. grounds, there is a considerable risk as there isn’t too much of a need for it now.
If Ocugen is on your radar, you should wait until at least a supply agreement is made and not before.