They say fools rush in where angels fear to tread, and so it is that I am once again writing about Ocugen (NASDAQ:OCGN) stock.

And once again, at the risk of sounding like a fool, I simply don’t understand the bull case for OCGN stock based on a potential Covid-19 vaccine.  

Ocugen is a small-cap biotech company that is devoted to finding cures for rare eye diseases, and it will be again.

For now, though the company is caught up in the Covid-19 vaccine race in the short-term.

Ocugen formed a partnership with Bharat Biotech regarding its Covid-19 vaccine candidate, Covaxin.

The partnership makes Ocugen responsible for Covaxin’s clinical development, regulatory approval and commercialization in the United States.  

Ocugen Is Part of the New Normal 

Normally a stock like Ocugen would not get much attention from retail investors, but these are not normal times. News of the partnership got the attention of online traders and to the moon it went. Well, not to the moon, but to levels not seen since 2019. 

At the beginning of February, OCGN stock was a penny stock. And while it’s still trading under $10 a share as of this writing, investors are still sitting on a 180% gain for the year.  

But all good things must come to an end. And in this article, I’ll express once again why I think it’s time to let go of OCGN stock. 

What About the Delta Variant? 

Looking on some message boards, I see that the emergence of the Delta variant of Covid-19 is acting as a catalyst for OCGN stock. The thinking (I suppose) is that the Covaxin vaccine will be more effective than the existing vaccines at protecting against this new variant. 

I see three flaws with that line of thinking. First, it appears that the current mRNA vaccines by Pfizer (NYSE:PFE) and Moderna (NASDAQ:MRNA) are effective against the Delta variant.

While some early speculation suggests recipients of the Johnson & Johnson (NYSE:JNJ) vaccine may need a booster, as of this writing there does not appear to be excessive concern. 

Second, as with the flu shot (I’m not saying the vaccines are “like” the flu shot), individuals can still contract Covid-19 even when fully vaccinated. This news, while sensationalized for sure, is not unexpected, and even then there’s no reason to believe Covaxin will be more effective.  

Finally, as I’ve mentioned before the United States does not face a problem of vaccine supply; only of demand.

This matters because Ocugen’s agreement with Bharat Biotech specifically states that Ocugen will receive 45% of the profits from the sale of Covaxin in the United States.  

That would take away a key reason for the U.S. Food & Drug Administration (FDA) to grant regulatory approval for Covaxin. And indeed Ocugen is walking away from seeking emergency use authorization (EUA).

The only question is did Ocugen do this of their own volition or whether they were given a nudge by the FDA.  

Is Canada a Possibility? 

Brendan Rearick recently wrote a piece for InvestorPlace that acknowledged Ocugen has found a partner to manufacture Covaxin.

Rearick mentioned that although the U.S. does look tapped out as a vaccine target, perhaps Ocugen could become the vaccine of choice in Canada.  

I suppose that’s a possibility, however in an interview on Fox Business, Michael Milken of the Milken Institute stated that it is likely by the end of this year there will be enough vaccine by the current suppliers for the entire world on an annual basis.

If those vaccines are as effective as they seem, it’s hard to imagine Ocugen getting a firm hold on the Canadian market.  

Is the OCGN Stock Juice Worth the Squeeze? 

Looking at the short interest on OCGN stock that sits above 22%, I imagine that some traders sniff a short squeeze coming on. I can appreciate that. It’s part of the 2021 playbook and, if it happens, I wish those traders well.  

As for me, I don’t hold out much hope for Ocugen as a serious Covid-19 play. If I’m wrong, I’ll look like a fool, but I’m okay with that.  

On the date of publication, Chris Markoch did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines. 

Chris Markoch is a freelance financial copywriter who has been covering the market for seven years. He has been writing for Investor Place since 2019.