NovoGen MMX Bioprinter. Image Source: Organovo

Each New Year presents the opportunity for change -- for better or for worse. 2015 turned out to be the worst year ever for Organovo Holdings (NASDAQ:ONVO) shareholders. The 3D bioprinted tissue developer's stock plunged more than 65%. After this dismal performance, could 2016 be Organovo's best year yet? Here are three reasons why it could happen. 

1. Revenue growth
Organovo went public in 2012. Since then, the company has accumulated total revenue of less than $2 million. Look for revenue growth to improve tremendously in 2016.

While Organovo's exVive3D bioprinted human liver tissue became commercially available in November 2014, it takes a while for such a radical new technology to gain momentum. Organovo reported revenue from exVive3D of around $200,000 last quarter, roughly the same amount posted in the first quarter.

Why should higher expectations be in order for the New Year? Organovo already announced contract bookings of around $2 million through June 9, 2015. Only $300,000 or so of those contract bookings had been recognized as revenue as of last quarter.  And while the company hasn't provided subsequent contract bookings updates, there's no reason to think that bookings have not increased since the middle of last year.

2. New tissues
In May, Organovo announced a significant partnership with L'Oreal USA to develop 3D bioprinted skin tissue. L'Oreal USA, the largest subsidiary of beauty products company L'Oreal Group, wants to use Organovo's technology to evaluate product safety and performance. It's not known when the bioprinted skin tissue will be ready, but there could be positive news from this partnership over the next year.

The bigger story for Organovo, though, will likely come from its human kidney tissue. Functional validation of the kidney tissue came in October, a couple of months earlier than initially projected. Organovo expects to start contracting for its bioprinted kidney tissue by third quarter of 2016.

This milestone holds a lot of potential for Organovo. In 2015, exVive3D picked up liver toxicity of diabetes drug Rezulin that wasn't caught before the drug gained FDA approval. Rezulin ultimately was pulled off the market after being linked to 63 deaths. 

At least four drugs have been yanked from the U.S. market over the past 30 years due in part to causing kidney damage in patients. Bayer AG (NASDAQOTH:BAYRY) marketed two of those drugs. Bayer's cholesterol drug Baycol was linked to 52 deaths worldwide caused by kidney failure. The drug was removed from the U.S. market in 2001. More recently, Bayer pulled Trasylol from the market in 2008 after the drug was associated with serious kidney damage, congestive heart failure, and strokes.

It's too soon to know if Organovo will be able to tout that its bioprinted human kidney tissue could have prevented failures such as the ones experienced by Bayer. However, the success with exVive3D in picking up liver toxicity could bode well for the company as it enters the market with its kidney program.

3. The past is the past
Several of the reasons behind Organovo's poor stock performance in 2015 should not be as problematic going forward. For example, one of the major reasons shares fell last year stemmed from a public stock offering in June. While this move diluted Organovo's stock and caused share prices to plunge, the company now sits on a nice cash stockpile of $76.9 million. That's enough to carry Organovo for a while.

Investors were quite jittery about Organovo last year, leading to the company responding via a "market update" in March. The good news now, though, is that short interest (a pretty good measure of how spooked investors are) is now at its lowest levels since the beginning of 2015.

Realistic expectations
The best year so far for Organovo's stock was 2013, when shares soared by 369%. For Organovo to exceed that performance, the stock needs to climb to nearly $12 per share. Will it make it in 2016? Probably not.

However, I expect Organovo to have a better year in 2016 than it did in 2015. The key for a company with a largely unproven new technology is to have that technology proven in the real world. The coming year should help Organovo build its case for exVive3D and further validate its technology with the launch of the new bioprinted human kidney tissue.

If I'm right, Organovo won't have its best year ever from a stock performance standpoint. But it could have its second best year ever -- making 2016 a Happy New Year indeed.