Ocugen (NASDAQ:OCGN) stock is up more than 5% today after reporting that its Covaxin drug candidate appears to be effective against current and future variants of Covid-19. Indeed, investors are rooting on OCGN stock today.
The Malvern, Pennsylvania-based company has also reported that recipients of Covaxin had an immune response to Covid-19 variants at least six months after receiving two doses of the vaccine. This is an encouraging development that has OCGN stock trending higher. The news is positive for Ocugen stock, which has declined 42% in the last month to now trade at $4.81 a share.
What Happened With OCGN Stock
In a news release, Ocugen stated that Covaxin has been found to “generate a robust immune memory” in people who received two doses of the vaccine.
“The results of this analysis are extremely important findings as we continue to learn about how the virus is mutating and how we can address variants of concern with vaccines, especially with the emergence of Omicron,” said Dr. David Fajgenbaum, assistant professor of medicine at the University of Pennsylvania and a member of Ocugen’s Vaccine Scientific Advisory Board.
The latest results are encouraging news for Ocugen, which has struggled to bring its Covid-19 vaccine to the U.S. market. Ocugen has inked a deal with Bharat Biotech, an India-based company that originally developed Covaxin. The agreement gives Ocugen the rights to commercialize Covaxin in the U.S. and Canada while Bharat Biotech holds the rights in the rest of the world.
However, Ocugen will only keep 45% of the profits Covaxin will generate in the U.S. and Canada, if it is eventually approved for use by the U.S. Food and Drug Administration (FDA).
Why It Matters
Ocugen is a small biotech company that is hoping distribution of Covaxin in North America will generate sizable revenue for the company. However, commercializing Covaxin in the U.S. could take several more years as Ocugen still needs to undertake a phase three clinical trial with the vaccine candidate.
OCGN stock has fallen more than 40% since mid-November because the FDA has put the company’s planned phase three trial on hold. The reasons for the FDA halting the study have not been made public. However, the delay has been enough to send Ocugen’s share price sharply lower. Still, even with the recent decline, Ocugen’s stock remains up 57% on the year. Moreover, it’s up a staggering 1,500% over the past 12 months.
The latest Covaxin news is sparking hope that Ocugen will be able to get the approval process back on track. However, the FDA hold on the phase three clinical trial remains in place. Furthermore, there is no timeline for it to resume. While today’s move higher is a positive development, OCGN stock remains volatile and subject to big price swings.
On the date of publication, Joel Baglole 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.