What the WHO approval for Covaxin means for Ocugen stock

Ocugen Inc (NASDAQ: OCGN) is a US based biopharmaceutical company which has primarily focused its research on developing a cure for blindness disease. However last year, Ocugen shifted their efforts towards distributing Covaxin, a COVID-19 vaccine developed by their Indian partner Bharat Biotech. Ocugen currently have the rights to distribute Covaxin in the US and Canada and take a 45% cut on sales, assuming the company can receive approval.

Earlier today, investors received the long awaited WHO decision regarding adding Covaxin to the finite list of COVID-19 vaccines with an Emergency Use Listing (EUL). The decision comes after the World Health Organisation had pushed back their final decision on Covaxin multiple times.

The pushbacks were due to further questions Bharat Biotech needed to address. The WHO approval saw the company trading 10% higher premarket, however the stock has since dipped. Here’s what investors need to know about the WHO decision and how it impacts Ocugen shareholders.

What the long awaited WHO approval means for Ocugen stock?

In May, Bharat Biotech applied for Emergency Use Listing for Covaxin with the World Health Organisation (WHO). Approval of a vaccine under an EUL, enables citizens who are vaccinated with Covaxin to travel to certain countries who only recognise a handful of WHO approved vaccines. So what are the benefits of an EUL from WHO for Ocugen stock?

Some investors are speculating that approval from the WHO provides Covaxin legitimacy. Furthermore, the WHO review highlights Covaxin’s effectiveness as it is reviewed by a board of scientific professionals who perform a risk analysis. The approval is feeding hopes that the EUL may push Covaxin approval over the line in countries Ocugen are planning to distribute Covaxin in.

An EUL is considered the golden stamp of approval for COVID-19 vaccines, with only 6 vaccines receiving this prior to Covaxin. In saying this, it remains unclear if this approval will have any effect on the timeline of Covaxin approval in either the USA or Canada. Ocugen stock has remained a speculative play as it generally fluctuates sharply on Covaxin data and decisions surrounding the vaccine from regulatory bodies.

How is Ocugen tracking with Covaxin approval?

In the latter half of 2020, a handful of companies including Pfizer and Moderna received emergency approval for their novel vaccines. This allowed for immediate distribution of the vaccine across the globe and has generated Billions in revenue.

With Bharat receiving emergency approval in its home country, investors saw Covaxin being approved in the US early this year. However, this changed after the company disclosed that they will no longer pursue a US Emergency Use Authorization (EUA) application for Covaxin after advice from the FDA. By the time Ocugen lodged their EUA application, the US was already distributing vaccines across the country.

Ocugen is now pursuing an IND to establish effectiveness of Covaxin across the US. The trial proposed in the US, if approved will examine the antibody response from the administration of Covaxin in comparison to a recently completed Phase 3 efficacy trial in India. Because Ocugen is only licensed to distribute Covaxin in the US and Canada, the company is yet to make a sale on the vaccine.

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The content above is strictly for informational purposes only and is not financial advice nor does it constitute a recommendation. Youth Investment Group has no liability for personal financial interests or investment decisions. You should make your own investment decisions based upon your own research and what you believe is best for you. 

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