If you’ve read my prior articles on Ocugen (NASDAQ:OCGN), you know full well my heavily bearish view about OCGN stock. What’s the story here? The company is trying to bring Covaxin, a Covid-19 vaccine candidate developed by India’s Bharat Biotech, to the U.S. and Canada.

So far, it’s made little progress obtaining Emergency Use Authorization (EUA) or full approval from health authorities in either country. On top of this, with vaccination rates so high in America and Canada, it’s doubtful this late comer will find big demand for Covaxin once its able to roll it out in North America. And Ocugen is only involved in Covaxin in Canada and the U.S.

Nevertheless, many traders have been bullish on the news. At least until a few days ago, in anticipation of a Emergency Use Listing (EUL) for Covaxin by the World Health Organization (WHO). But now, as the WHO has officially given the candidate an EUL?

They’re “selling the news” in droves. Trading for as much as $17.65 per share leading up to the news, shares dropped 18% when it was announced on Nov. 3, and another 22% the following day. With shares back down to around $10 per share as of this writing, stay away, as it won’t be long before it tumbles further into the single-digits.

Covaxin EUL Still Doesn’t Look Like a Game-Changer

Sure, perhaps it’s short-sighted of me to believe the benefits to Ocugen from getting an EUL from the WHO for Covaxin are overblown. I’ll concede that obtaining an EUL paves the way for a U.S. trial for the Covid-19 vaccine candidate.

With a successful U.S. trial? The company will have much better chances of being able to market Covaxin stateside. Then again, U.S. Food and Drug Administration (FDA) approval alone doesn’t save the day for OCGN stock. To sustain and grow its current value, it needs to sell hundreds of millions of Covaxin doses.

Therein lies the problem. More than two-thirds of Americans have already received at least one dose of one of the existing vaccine candidates. Expect this number to keep on climbing, as employer-based vaccine mandates come into effect. In short, it’s doubtful the company will be able to sell a few million doses. That puts into severe doubt that Ocugen can sell the hundreds of millions of doses it needs to support its stock price.

What does that mean for Ocugen shares? In the months ahead, FDA approval for Covaxin could remain a work-in-progress. Meanwhile, vaccination rates in the U.S. and Canada could keep climbing. This candidate’s potential market size will continue to shrink. Especially if other candidates, like the one from Novavax (NASDAQ:NVAX), become available in stateside and in Canada during this time. As this company’s valuation today is built almost entirely on Covaxin hype. It’ll give back the lion’s share of its gains related to this catalyst.

Expect a Continued Move to Much Lower Prices

After its dive following the WHO news, expect OCGN stock to drop even lower. How low? Shares stand to make their way back toward what it traded for before the Covaxin catalyst emerged. That’s the case whether it fails to secure FDA/Health Canada approval or, if it does get approval, but fails to find enough demand in the U.S. and Canada.

Sure, perhaps not completely back to 29 cents. That was its closing price on Dec 21, 2020, the day before when the Covaxin licensing deal was announced. While dilutive, the capital raises it executed after it started to run hot have boosted its cash position. Today, the value of the cash on its balance sheet ($115.6 million) is worth around 58 cents per share.

Also, as it’s made progress with one of its non-Covaxin candidates, the company (outside of Covaxin) is likely worth more now than it was nearly a year ago. Progress notwithstanding, that candidate (OCU410), plus its other candidates, are all still in the preclinical stage. At best, it may only partially soften the blow.

Yet, no matter the valuation Mr. Market assigns to OCGN stock post-Covaxin, expect it to be materially lower than where it trades today.

Bottom Line on Ocugen

Buying the rumor, and selling the news, many traders are cashing out of Ocugen. Others may be staying in, believing that a WHO EUL will lead speed up Covaxin’s path to FDA approval.

However, there’s little to signal that this recent news changes the game here. A WHO EUL does not guarantee FDA approval. Even with approval, with vaccination rates climbing, its chances of selling enough doses to justify its valuation seem slim.

With its chances of experiencing another sharp slide in price likely, if you own OCGN stock today? Cash out ASAP to avoid holding the bag. If you don’t own it? Avoid at all costs.

On the date of publication, Thomas Niel 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.

Thomas Niel, a contributor for InvestorPlace.com, has been writing single-stock analysis for web-based publications since 2016.