In the rosiest of scenarios for Ocugen (NASDAQ:OCGN) stock, the Covaxin vaccine for the novel coronavirus will be approved by the FDA only around the second quarter of 2023. And the company appears to be dragging its feet on getting the process started.

Meanwhile, information I recently uncovered suggests that Canada will probably not approve Covaxin any time soon either, if at all. I continue to believe that the FDA will, in all likelihood, never give a nod to Covaxin, and I think that the odds of Canada approving the shot are very low.

In contracts with India-based pharmaceutical company Bharat Biotech, which developed Covaxin, Ocugen was awarded 45% of any profits from the sales of the shot in the U.S. and Canada.

The FDA Is Requiring a U.S.-Based Trial of Covaxin

Importantly, according to FDANews, “the agency told Ocugen it needs to see results from an additional U.S. trial of the two-dose vaccine and said it will assess the BLA based on data from that study.”

In multiple previous columns on OCGN stock, I had suggested that the FDA would probably require Ocugen to submit data from a U.S.-based trial of Covaxin before it would agree to approve the shot.

After the FDA declined to grant Ocugen’s EUA application, the company did state that it “anticipates that data from an additional clinical trial will be required to support the submission.”

The Likely Timetable for FDA Approval

Phase 3 trials can take years, but trials of coronavirus vaccine candidates have been completed in much less time. Bharat Biotech, for example, began its Phase 3 trials in November 2020 and unveiled final Phase 3 data on the vaccine earlier this month. That’s about eight months.

But we should probably add at least two months for recruiting patients, setting up the sites, etc. So just getting the final Phase 3 data would likely take Ocugen around 10 months.

But then the FDA needs time to study the data. The vaccines from Pfizer (NYSE:PFE) and Moderna (NASDAQ:MRNA) were given emergency use authorizations only several weeks after the companies submitted their Phase 3 data. But the rules for EUAs and full approvals are totally different.

In fact, Pfizer, for example, says that it only expects to receive full approval for its vaccine by January 2022, over a year after it submitted its Phase 3 data.

So Ocugen likely needs about 10 months to set up and conduct a Phase 3 trial, and it will probably be at least another year thereafter before any approval would be granted. So, we’re looking at about 22 months from now, or around the second quarter of 2023.

Some OCGN stock bulls would likely argue that the FDA would assess the application more quickly because it had already received the Phase 3 data from the trials of Covaxin that Bharat conducted in India. But the agency has received data from tens of millions of recipients of the Pfizer vaccine, yet it’s still taking around a year before granting the shot full approval.

Meanwhile, Ocugen doesn’t seem to be rushing to set up a Phase 3 trial in the U.S. The company issued multiple disclosures about its preparations to submit an EUA application for Covaxin. But as far as I can tell, it hasn’t said a word publicly about setting up a Phase 3 trial in the U.S.

In an e-mail that I sent to a representative of the company on July 20, I asked about this issue. The representative did not answer the question.

Canada Is Not Enthusiastic About Covaxin

Even though I pointed out in a previous column that Ocugen, in all likelihood, would not generate a profit from Canada even if Ottawa approves Covaxin, many OCGN stock bulls are still very enthused about the company’s prospects in the country.

So it’s worth noting that the Canadian government does not view travelers who have received the Covaxin shot as being fully vaccinated when it comes to deciding who can enter the country.

At the very least, in my view, that does not bode well at all for Ocugen’s chances of obtaining an EUA from Canada.

The Bottom Line on OCGN Stock

It appears that the earliest Covaxin can be approved in the U.S. is mid-2023. By that time, it’s possible that the coronavirus will have been eradicated by herd immunity or that Americans will be receiving their second or third booster shots.

And perhaps most alarmingly for the owners of OCGN stock, well over a month after the FDA rejected Ocugen’s EUA application, there are no signs that the company is working to launch the Phase 3 trial in the U.S. which the agency is reportedly requiring.

Meanwhile, in Canada, the outlook for Ocugen is also dismal, since the Canadian government does not view those who have received Covaxin as being fully vaccinated.

I believe the chances of Covaxin being approved in the U.S. are extremely low. But even in the extremely unlikely event that an approval is granted, it will probably be too late to help Ocugen and OCGN stock. And investors will likely move on to greener pastures well before 2023 anyway.

Given all these points, I continue to recommend that the owners of the shares sell them, and I still view OCGN stock as an exceptionally good target for short sellers.

On the date of publication, Larry Ramer held a short position in OCGN. 

Larry has conducted research and written articles on U.S. stocks for 14 years. He has been employed by The Fly and Israel’s largest business newspaper, Globes. Among his highly successful contrarian picks have been solar stocks, Roku, and Snap. You can reach him on StockTwits at @larryramer. Larry began writing columns for InvestorPlace in 2015.