Shares of Ocugen (NASDAQ:OCGN) were jumping 7.2% higher as of 11:28 a.m. EST after rising as much as 16.4% earlier in the day. There wasn’t any news fueling the drugmaker’s gain. Instead, today’s move appears to stem from continued enthusiasm among investors about the prospects for COVID-19 vaccine candidate Covaxin. Ocugen announced earlier this month that it’s teaming up with India-based Bharat Biotech to commercialize the vaccine in the U.S.
Momentum is a law of physics that also often applies to biotech stocks such as Ocugen. Initial excitement about a stock among some investors catches the attention of other investors. As these investors scoop up shares, the cycle repeats and can create the kind of momentum we’re seeing with Ocugen.
It’s important to focus more on the business than the stock price when this scenario happens, though. Ocugen and Bharat still have several hurdles to jump before Covaxin can be commercialized in the U.S. The vaccine won emergency use authorization (EUA) in India in January, but so far no clinical studies evaluating Covaxin have been conducted in the U.S.
Ocugen currently doesn’t have any products on the market. Nor does it have any candidates of its own in clinical testing. However, Ocugen’s pipeline includes three preclinical programs targeting eye diseases.
Ocugen is talking with the U.S. Food and Drug Administration (FDA) and the Biomedical Advanced Research and Development Authority (BARDA) about a potential path toward securing EUA and ultimately full regulatory approval in the U.S. It’s also planning to begin two phase 1/2a clinical studies of experimental gene therapy OCU400 in treating genetic eye diseases this year. Substantial progress on these efforts will probably be needed for the stock to keep its momentum going.