Investors in Ocugen (OCGN 2.98%) at the start of the year have reason to cheer. The stock has gained more than 260%. And those who sold their shares at the February high posted a gain of 763%. The stock has been flying high amid optimism about a deal to co-commercialize a potential coronavirus vaccine in the U.S.

Now, the question is whether it's too late to get in on this story -- or if Ocugen's share gains are only just beginning. Let's take a closer look at what's happened so far and what lies ahead.

A nurse prepares a dose of coronavirus vaccine while a patient waits in the background.

Image source: Getty Images.

A deal with Bharat Biotech

Ocugen is developing gene therapy for the treatment of eye diseases that cause blindness. All of these candidates are in pre-phase 1 stages of development. But a major step is ahead. The company plans on launching four phase 1/2 trials in 2021 and 2022.

Earlier this year, Ocugen confirmed its involvement in a completely different area: coronavirus vaccine development. The company signed a deal with India's Bharat Biotech to co-develop and co-commercialize Bharat's Covaxin in the U.S.

Bharat is testing Covaxin in a phase 3 trial. And India has already authorized the vaccine for emergency use. As part of the Ocugen-Bharat agreement, Ocugen will receive 45% of U.S. profits.

This week, Bharat announced the latest batch of results from its trial, which showed 78% efficacy in the prevention of mild, moderate, and severe COVID-19. It demonstrated 100% efficacy in the prevention of severe disease alone. The trial enrolled more than 25,000 participants. And the data are based on the accrual of 127 symptomatic cases of COVID-19.

It's difficult to compare Bharat's data to the early results of market leaders Pfizer (PFE 1.59%) and Moderna. When Pfizer and Moderna generated initial reports, variants of concern hadn't yet gained ground. And India -- where Bharat's trial is taking place -- is the new coronavirus epicenter. The country is even home to a new variant. However, we can take a look at a more recent data report from one of today's leaders.

Early this month, Pfizer announced trial data updated through March 13. By this time, 927 symptomatic cases of coronavirus had accrued. The vaccine showed 91.3% efficacy against COVID-19. Efficacy against severe disease was 95.3% as defined by the U.S. Food and Drug Administration (FDA). And in South Africa, where the South African variant of concern is prevalent, the vaccine demonstrated 100% efficacy. So far, Pfizer may have an edge when it comes to efficacy.

Higher than the bar

That said, the FDA set a bar at 50% efficacy for Emergency Use Authorization (EUA). Covaxin clearly surpasses that level. Ocugen last month said it's in discussions with the FDA to develop a regulatory pathway for Covaxin in the U.S.

We still don't know if the FDA will require a U.S.-based clinical trial or if it will base an EUA decision on data from the Indian trial. In either case, Ocugen is more likely to participate in a later round of vaccinations rather than an initial rollout -- simply because the U.S. has already ordered enough vaccine doses right now from market leaders.

But Ocugen also will face major competition at that point. Rivals Pfizer and Moderna will continue to dominate the market if their efficacy and safety performance remains high. And potential newcomers like Novavax may take market share. Novavax already has an order from the U.S. government for 110 million doses.

It will be difficult for Ocugen to carve out market share unless its vaccine stands out in some way. And right now, Pfizer, Moderna, and others are testing boosters to target variants and aiming to broaden their audiences to children. So, Ocugen's options are limited.

Does this mean it's too late to buy Ocugen stock?

For the most aggressive short-term investors -- probably not. They may gain from positions in this biotech stock in the months to come. Each time Ocugen reports positive news about Covaxin, the shares soar.

I like Ocugen's idea of gaining access to a close-to-market product. That way, the company generates revenue as it continues development of its core early-stage programs.

But I'm concerned about Ocugen's ability to generate significant revenue from Covaxin -- and the shares' ability to steadily increase over time. And that's why, for long-term investors, it's actually too early to buy Ocugen stock. I'm interested in seeing how potential Covaxin sales fuel development of its gene therapy program.

So, for now, it's best to keep an eye on Ocugen -- and opt for other coronavirus stocks.