The World Health Organization (WHO) has suspended Covid-19 vaccine Covaxin through United Nations supply agencies. The setback is yet another entry in the seemingly never-ending woes for U.S. biotech Ocugen (NASDAQ:OCGN), which hopes to commercialize Covaxin in North America and kick-start a bull run in OCGN stock.
Following an emergency use listing (EUL) inspection that took place in mid-March, the WHO announced over the weekend that it recommends countries that received Covaxin vaccines take appropriate measures. Though the organization did not offer specifics, it cited good manufacturing practices (GMP) deficiencies in the vaccine’s production.
The suspension is meant to give Ocugen’s partner, India’s Bharat Biotech, time to complete facility and process upgrades to rectify the issues found in the inspection. Although the WHO said there were no safety or efficacy issues, the suspension is likely to disrupt the supply of Covaxin.
OCGN stock opened lower Monday but rebounded to close the day up 4.6%. Shares are up 47% in the past three weeks but down 27% year to date and more than 80% from their November high.
Earlier in 2021, OCGN stock soared more than 700% on news of the Covaxin co-commercialization deal. However, its efforts to commercialize the vaccine in North America haven’t borne fruit thus far, and many are saying it’s too little too late for the company.
Covaxin’s nod of approval from the WHO has perhaps the biggest positive development for Ocugen after the vaccine got snubbed by the U.S. Food and Drug Administration (FDA). With the WHO’s recent suspension, there seems to be little here for long-term investors.
Expect a bumpy road ahead for OCGN stock as it looks to mount a recovery. Perhaps investors could revisit the company based on its work in eye diseases in the long term.
On the date of publication, Muslim Farooque 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.
Muslim Farooque is a keen investor and an optimist at heart. A life-long gamer and tech enthusiast, he has a particular affinity for analyzing technology stocks. Muslim holds a bachelor’s of science degree in applied accounting from Oxford Brookes University.