If you happen to be an ardent supporter of Ocugen (NASDAQ:OCGN) stock, you might want to turn away.
While I’m going to assess both sides of the issue, ultimately, OCGN stock depends on a particular brand of sentiment that appears to be fading away.
Still, let me acknowledge what a remarkable turnaround this biotechnology firm – which primarily specializes in rare eye diseases – has engineered. A year ago, OCGN stock was trading at 28 cents a pop. Soon thereafter, though, the event that unfolded belongs in meme-trade lore.
Long story short, Ocugen partnered with India-based Bharat Biotech to co-develop Covaxin, one of many vaccines for the SARS-CoV-2 virus. Per the terms of the deal, Ocugen will advance the drug in the U.S. and Canadian markets, as our own David Moadel reported.
Better yet for OCGN stock, Covaxin enjoys clinical and regulatory support. Recently, the World Health Organization granted an emergency use listing for the vaccine. Also, peer-reviewed data published in The Lancet indicates that Covaxin is 77.8% effective at preventing symptomatic Covid-19.
Even more encouraging, “No serious adverse events were detected in the trial. The vaccine was found to have a very good safety profile with only occasional mild side effects reported, such as headache or pain at injection site.”
In theory, such news should be a boon for OCGN stock. Yes, the underlying company is late to the game, especially with leaders Pfizer (NYSE:PFE) and Moderna (NASDAQ:MRNA) having already rolled out their mRNA-based vaccines to the public. However, new infections are rising again in the U.S. and other parts of the world.
And here’s the kicker: Ocugen utilizes an inactivated (i.e., killed virus) vaccine approach, which has an extensive history. This should put the vaccine-hesitant minds at ease.
OCGN Stock Is Stuck in an Irony
Through logical deduction, you would imagine that OCGN stock is primed for upside success. First, you have new cases rising. Second, the underlying solution utilizes an approach for basically as long as there have been vaccines. It’s the magic key to send shares to the moon.
However, the same groupthink mentality that has done very well for meme stocks and coins might be the very sentiment that stymies OCGN stock. With Covid conspiracy theories running rampant, Ocugen has a snowball’s chance in perdition of succeeding where others have failed.
I know that YouTube is not the arbiter of pretty much anything but go look up any video supporting the scientific basis of Covid-19 vaccines. Chances are, you’ll see nothing but long debunked conspiratorial talking points – such as the false concept that mRNA vaccines materialized overnight – flood the comments section.
Oh yeah, and a terrible thumbs-down-to-thumbs-up ratio.
Again, YouTube commentary is only anecdotally useful, if at all. But ample research indicates that conspiracy theories have been ramping up over the trailing decade. And with so many conspiracies left unchecked – we never went to the moon, the earth is flat, Bill Gates wants to kill everyone – the skeptics have their Spidey senses on full alert.
So when Moadel states that OCGN stock is a sell-the-news moment that’s actually a buying opportunity, I must disagree. Not that I don’t think his science-based thesis is sound – it very much is. But what’s the point about mentioning the science when those Ocugen is trying to convince have a different definition of science?
Maybe I might extend a credible shot to OCGN stock if the focus wasn’t the North American market. But trying to convince the unvaccinated to take the jab today is highly unrealistic.
No Offense, Just the Facts
Don’t take the above to assume that I’m critical of the anti-vaccine crowd. Frankly, the U.S. government itself needs to take responsibility for this mess. Remember Surgeon General Jerome M. Adams’ tweeting in all-caps to stop buying masks?
Well, so much for that. The Mayo Clinic and many others have stated that, in combination with other mitigation protocols, masks (particularly the N95s) help slow the spread of Covid-19. So when government officials are caught red-handed deceiving the American public (even if it’s for the greater good), it allows skepticism and conspiracy theories to fester.
And that’s where groupthink is problematic, especially for OCGN stock. Because invariably, some of the same people who are bidding up OCGN are the ones who will never get vaccinated. I think that’s why the equity unit’s price action resembles an EKG monitor. Simply, the masses don’t know what to believe and that’s causing confusion with Ocugen shares.
On the date of publication, Josh Enomoto did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
A former senior business analyst for Sony Electronics, Josh Enomoto has helped broker major contracts with Fortune Global 500 companies. Over the past several years, he has delivered unique, critical insights for the investment markets, as well as various other industries including legal, construction management, and healthcare.