What happened
Shares of Ocugen (OCGN 0.81%) were crashing 19.2% lower as of 11:23 a.m. ET on Friday. The steep decline came after the company announced that the U.S. Food and Drug Administration (FDA) won't grant Emergency Use Authorization (EUA) for COVID-19 vaccine Covaxin in children ages two to 18.
So what
Some investors had set their hopes on the FDA being more lenient with pediatric use of Covaxin. Ocugen executives even sounded cautiously optimistic in the company's fourth-quarter conference call last month.
CEO Shankar Musunuri stated that he was "pleased to say" that Ocugen was in discussions with the FDA about the data it had submitted for the pediatric EUA. CFO Sanjay Subramanian said that there was "the potential for near-term revenue," depending on the EUA.
The FDA's decision not to issue EUA really wasn't all that surprising, though. Ocugen abandoned its pursuit of a U.S. EUA for Covaxin in immunizing adults last year. The FDA told the company in June 2021 that it should instead follow the standard path to full approval of the vaccine in adults.
Image source: Getty Images.
Now what
Ocugen stated in a press release that it plans to "continue working with the FDA to evaluate the regulatory pathway for the pediatric use of Covaxin." That pathway will likely require the company to conduct further clinical testing of the vaccine in the U.S.
Are there any other near-term catalysts for the biotech stock? Maybe. Ocugen has responded to Health Canada regarding deficiencies identified with its regulatory filing for Covaxin. There's still a chance that the vaccine could receive a green light in Canada.
