Organovo is attempting to reduce the time it takes for drug companies to measure toxicity in their potential compounds. Image source: Organovo.

Shareholders of 3D bioprinting company Organovo (ONVO) have certainly seen better days. After releasing earnings for first fiscal quarter, shares traded down by as much as 27% yesterday. Since November 2013, the company has lost almost 80% of its value.

Revenue came in at $306,000, and earnings per share registered at a loss of $0.10 per share. Both of these figures came in below Wall Street's expectations.

While that may have been the cause of some consternation, it was management's inability to provide any additional updates on the company's first marketable product -- the exVive 3D Human Liver Tissues -- that was the most frustrating.

Trying investors' patience
Last year, when the human liver tissues were getting ready for their initial November launch, CEO Keith Murphy was careful to explain that adoption of the product wouldn't explode overnight. Instead, he explained that the curve would look more like the red line below.

Source: Organovo.

And so, investors prepared themselves for a more gradual adoption curve.

Then Murphy let us know that actual revenues from the liver product wouldn't show up in the fourth quarter of 2014 or the first quarter of 2015. Instead, investors would have to wait all the way until August (i.e. now) to find out how the liver assay was selling.

Organovo actually came through earlier than expected on that timeline, announcing in June that it had "recorded total contract bookings for its commercial liver tissue product of approximately $1.94 million."

But then Murphy added -- and reiterated in yesterday's conference call -- that "we plan to update contract bookings not on a quarterly basis but on an annual basis." During the conference call, analysts were quick to ask if management could provide any clarity on what's happening with the bookings, but the answer essentially remained the same: You'll have to wait until mid-2016.

As you might expect, with such opacity from management, investors (and likely short sellers in particular) drove the stock down hard.

What we do know
Given that there's a lot that we individual investors can't know, it's worth focusing on what we do have a handle on. There were three big takeaways.

First, management reiterated that each contract for the liver tissues was at or above $150,000. Given the contract bookings stood at $1.94 million earlier, that means the company likely has 12 or 13 contracts for the liver tissue use. Management said that customers included top 25 global pharmaceutical companies and that at least one customer had signed on for multiple orders.

Second, its secondary offering was relatively successful. It was able to raise $46 million in cash, and its overall cash position now sits at $86 million. This money will go toward ramping up capacity for the liver and kidney tissues (discussed below), as well as bolstering their R&D and sales teams.

CFO Barry Michaels said the company expects to burn through $30 million annually moving forward. That means that Organovo has roughly three years to become profitable before it runs out of money.

Finally, its second major product, the exVive 3D Human Kidney Tissue, will be coming to market in 2016. Management said that functional validation should be completed by December 2015 and that the kidney tissue would be ready for a market launch in September 2016.

It also reiterated that the kidney tissue will likely be able to fetch a higher price point -- as there is far more unmet demand for kidney tissues -- and that the average contract is still expected to be worth somewhere in the ballpark of $250,000.

As a shareholder in Organovo myself, I'm encouraged by the progress of the kidney tissue, but am very disappointed that management has chosen to take the route of opacity in letting us -- the owners of the company -- know about progress of the liver tissue's contract bookings.

Even though the stock is sitting so low, I won't be adding any shares until I get an indication that the liver tissue is being favorably accepted by the pharmaceutical community.