Biopharmaceutical company Ocugen (NASDAQ:OCGN) announced today that the U.S. Food and Drug Administration (FDA) approved the company’s Investigational New Drug (IND) application for a human clinical trial of OCU400. OCU400 is a gene-therapy candidate targeting several degenerative eye diseases that severely impair vision. Despite the news, OCGN stock is down 2.5% today as investors seem reluctant to buy into the struggling med-tech company.
Shankar Musunuri, chief executive and co-founder of Ocugen, commented on the significance of this recent development.
“We are delighted to advance OCU400 into clinical trials, which exemplifies our goal of offering new options to people with genetic diseases where none currently exist. … We’re collaborating with leading centers in eye care and have been vital partners to getting our trial launched and receive patients. With this final decision by the FDA, we are embarking on a new pathway of care through this innovative gene therapy.”
The news comes as a welcome change of pace for the company. Ocugen is perhaps best known for its Covid-19 vaccine Covaxin, which largely lags behind the competition. On Nov. 30, the FDA issued a hold on an approval application for late-stage clinical testing of its vaccine.
Ocugen represents just the North American side of the vaccine’s distribution. Meanwhile, Bharat Biotech, co-developer of the vaccine, has earned approval for use in 17 countries, including the company’s native India. This stands in stark contrast to Ocugen, who many investors believe is too little too late. Ocugen has come under fire for attempting to penetrate largely saturated Western markets as it pertains to vaccine options.
Will this latest news shake things up for the struggling pharma company?
OCU400: A Silver Lining for Struggling OCGN stock
Arguably, OCU400 is Ocugen’s main prize-horse going forward. Anticipation surrounding the company’s breakthrough gene-therapy programs has taken OCGN stock to the moon and back in the past few years. However, that anticipation has largely died down. With many estimating it could be years before such a therapy hits the market, combined with seemingly constant roadblocks for its vaccine candidate, OCGN stock has been on a cold streak for quite a while. Therefore, this news should come as a breath of fresh air for OCGN investors.
Preliminary estimates see OCU400 being a completely novel solution to a series of retinal degenerative diseases. This year, the European Medicines Agency (EMA) even granted OCU400 a broad medical designation for two different optical diseases.
While investors currently seem hesitant, hope isn’t lost yet. Positive developments of this nature can create the positive momentum necessary to bring the stock back from the dead.
On the date of publication, Shrey Dua 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.