Commission-free trading platform Robinhood Markets grew in prominence helping newer investors participate in what remains one of the best ways to accumulate wealth over time. The initiative seems like a good one in principle. And to make matters more interesting, Robinhood offers a peek into the minds of its clients with its list of the 100 most-held stocks on the platform.

However, this list reveals some picks that aren't particularly good. One example is Ocugen (OCGN -2.43%). This biotech has been a regular on this ranking for some time now. However, it is best for investors, on Robinhood or elsewhere, to distance themselves from this company, at least for now. Let's consider why.OCGN Chart

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Can Ocugen succeed in the COVID-19 vaccine market?

Ocugen rose in popularity in early 2021 after announcing it would seek to enter the coronavirus vaccine market in the U.S. The company's product, Covaxin, was initially developed in India by Bharat Biotech. Per an agreement between the two entities, Ocugen would be responsible for marketing Covaxin in North America, and it would keep 45% of the profits the vaccine would generate in the region.

However, regulators in the U.S. suggested that Ocugen seek approval as opposed to seeking Emergency Use Authorization (EUA) for Covaxin, the latter being a much longer process. Covaxin is currently undergoing a phase 2/3 clinical trial in the country. Although Covaxin proved safe and effective in a clinical trial conducted in India, Ocugen is required to run a parallel study in the U.S. The estimated date for the trial's completion is Oct. 31, 2023.

Obtaining approval could take up to 10 months after the study concludes, provided Covaxin produces results that regulators in the U.S. find acceptable. But there is another problem. Even if Covaxin is approved for primary vaccination (rather than as a booster option), its prospects would be limited. Nearly 80% of the U.S. population has received at least one dose of a COVID-19 vaccine.

Ocugen does have a plan to deal with this fact. In February, it reported the results of a poll it had commissioned that showed 73% of Americans want vaccines developed using traditional methods. Some of the leading vaccines in the U.S. are mRNA vaccines -- and until this pandemic, no such vaccine had ever won approval from the U.S. Food and Drug Administration (FDA). Covaxin is not an mRNA vaccine, so in theory, it could be popular among those who have yet to be inoculated and are waiting for such an option.

However, this experiment isn't going well for Novavax right now. This biotech's vaccine, Nuvaxovid, is also a traditional one, but it is not generating nearly as much revenue as Novavax anticipated after recently earning EUA in the U.S. To be fair, Nuvaxovid hasn't been available in the U.S. for very long, but the fact that Novavax cut its guidance for the year isn't a good sign. There is no reason to think Covaxin would do better, and it could even do worse. By the time it earns approval (whenever that is), Novavax will have already made some headway in the market of mRNA skeptics, however large this niche is.

Covaxin is authorized for adults in Mexico, and Ocugen applied for EUA for the vaccine for children in the country. Meanwhile, the biotech has been awaiting EUA for Covaxin from Canadian authorities for about a year. The coronavirus vaccine market is highly competitive all over the world, including in these countries, and the vaccination rates are already pretty high in both. Covaxin's prospects in Canada and Mexico may look better than they do in the U.S., but not a lot.

Overall, there is little reason to invest in this stock for its coronavirus-related efforts. 

Little to cheer for in Ocugen's other efforts

What else does Ocugen have going its way? Most of its non-coronavirus-related products are still in the early stages, and none are likely to hit the market before 2024 at the earliest. During the first half of 2022, Ocugen did not generate a single dollar in revenue while it posted a net loss of $37.5 million, slightly worse than the net loss of $33 million reported during the year-ago period.

It's not rare for small biotechs not to record any revenue or to be unprofitable. That's one reason these stocks are generally much riskier than average. But Ocugen's poor chances for its most advanced candidate, Covaxin, not to mention the long road ahead before it can market any other products, make investing in this stock far too much of a gamble, at least for now.

Investors on Robinhood or elsewhere would do well to look into some of the other and much more promising biotech stocks instead.