For those wishing to invest in 3-D bioprinting, Organovo Holdings, Inc. (NASDAQ:ONVO) is the only pure play in town. Organovo currently bioprints and markets human tissues as a means of accelerating preclinical drug testing. In less than 10 years, the company has expectations that it will be delivering tissue suitable for surgical therapy and transplantation, with a longer-term goal of replicating entire human organs for transplant.
While our contributors have different opinions about Organovo's future, there's no debate about the potential market. Each year, approximately 30,000 tissue donors save and heal lives in the U.S., but that doesn't begin to meet the need, according to the United Network for Organ Sharing (UNOS). In terms of organs, every 10 minutes another name is added to the transplant waiting list, but an average of 21 people still die each day because the organs aren't available. Meanwhile, nine out of 10 Americans say they support donation, but only three out of 10 know the simple but essential steps to take to donate a gift of life, which, just in case you may be one of the three, can be found here.
But what will Organovo Holdings look like in 10 years? Will it deliver on its promises or still be losing shareholders' money? Our contributors weigh in on the possible future of this company 10 years from now.
Brian Stoffel: Organovo is one of the most speculative stocks out there. While the company is valued at roughly $275 million, it has only produced a scant $1 million in revenue over the past 12 months. The biggest issue over the medium term will be balancing the need to spend on R&D as well as marketing, while not running out of cash or needing further dilutive offerings.
That's why I think it makes the most sense to see Organovo getting bought out over the next decade. The company has partnered with some of the top names in Big Pharma, cosmetics, and academic institutions. These companies are familiar with what the company's NovoGen MMX bioprinter can do and over time will be well aware of how it could help them save money.
If Organovo's liver and kidney assays end up being successes, the company could probably still be bought out for under $1 billion. And if traction on these products is slow but the company still shows long-term promise, it could be a very cheap acquisition for any drug company to make.
Cheryl Swanson: Within 10 years, advances in medical technology should allow the implantation of 3D-printed replacement tissue for vital organs in the body. And Organovo fully intends to be the first company to make that breakthrough.
While 3D-printed "patches" have been used in hospitals to simulate bones or other body parts, we're a long way from seeing vital organs repaired and regenerated. Still, company CEO Keith Murphy claimed last year that Organovo would probably be printing partial livers for human implantation within four to six years. To make that timeline potentially doable, the company has bagged some impressive collaborations, including one with Yale Medical School.
On the other hand, Organovo is burning through $30 million annually. While Organovo beat its own timeline to 3D-print liver tissue for drug testing, as Brian pointed out by mentioning its scant revenue, pharmaceutical companies have been extremely slow to adopt the new technology. From a scientific perspective, Organovo looks to be a promising player in the regenerative-medicine space. But with its liver assays yet to prove their commercial value, this visionary company has big-time risk written all over it. Organovo certainly isn't a stock for those who avoid treacherous market terrain, but then, who said solving a major medical problem would be easy?
Sean Williams: Where will Organovo Holdings be in 10 years? While it's probably not a popular guess, my suggestion would be a speculative niche company still valued predominantly on the potential for its Star Trek-like implantable technology.
The good news for Organovo is that it does have the makings of a recurring revenue stream with its ExVive3D Liver Tissue assay already on the market and its ExVive3D Kidney Tissue assay in development and expected to come to market relatively soon. These tools, which used bioprinted human liver and kidney tissues, should allow universities and drug developers a quick and cost-effective way of testing toxicity levels of experimental drugs before reaching costly human trials. As we see a push toward personalized medicine, it's possible ExVive3D could take on a bigger role and use.
However, I'm not convinced that ExVive3D assays alone can get Organovo to profitability anytime soon -- and neither is Wall Street, which isn't projecting profits for any earlier than 2020.
Instead, I anticipate that 10 years from now we'll still be talking about implantable 3D organs, but I wouldn't expect them to be a big top- or bottom-line driver for Organovo. The biggest issues I can foresee with 3D implantable organs are going to be cost-effective development methods, establishing a reasonable price that insurers and consumers would be willing pay for bioprinted organs, and finding a long-term partner that would be willing to fund Organovo's research, since it'll probably be burning through a lot of cash via research and development.
There's no doubt Organovo has promise, but I believe it'll be, at least to some degree, as speculative of an investment in 2025 as it is today.
Brian Stoffel has no position in any stocks mentioned. Cheryl Swanson has no position in any stocks mentioned. Sean Williams has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.