It’s amazing what a year can do. This time last year, Ocugen (NASDAQ:OCGN) was trading below 30 cents a share. One year later, OCGN stock trades above $5, more than 1,683% higher. 

If you bought in December 2020 and still hold Ocugen shares, I would suggest you give thanks for your unexpected bounty.

Then I would sell my shares on the first trading day of January to push your capital gains to the 2022 tax year. You’ve done well. Call it a day and move on to another play.  Here’s why I feel this way. 

OCGN Stock Is Still Higher Than It Ought to Be

The last time I wrote about Ocugen was Nov. 30. Despite being a major naysayer when it comes to OCGN — Exhibit A and Exhibit B — I felt like its share price might have bottomed out at $6.34, its closing price that day.

Instead, as I write this, it’s down another 14% two weeks later, off 35% over the past month. Here’s how I concluded my latest article on Ocugen:

“At this point, $8 seems like the top-end of any Ocugen stock valuation. However, the longer Ocugen goes without a Covid-19 catalyst, the lower its share price should go,” I wrote, “That said, I don’t think OCGN will hit penny-stock status before the end of the year. There’s still a ton of volume keeping it artificially high.”

So far in December, it’s avoided penny-stock status — it hit a low of $4.83 on Dec. 15 — but we’ve still got several trading days left in the month. So, as I said then, and I’ll repeat it now, if you can hold off selling until the new year, you might want to do so for tax purposes. 

Ultimately, however, I believe 2022 will see the biotech stock trade lower, barring unbelievably positive news about Covaxin, its Covid-19 vaccine. But, of course, the UK just reported its first death from the omicron variant, so you never do know. 

But it’s not looking good for the company.

What About OCU400?

The Ocugen bulls have often trumpeted the company’s diversified portfolio beyond Covaxin. Specifically, they’re excited about OCU400, its gene-therapy candidate for degenerative eye diseases. 

On Dec. 9, the U.S. Food and Drug Administration (FDA) approved its Investigational New Drug (IND) application for an OCU400 clinical trial. That’s a nice story to tell investors, so they don’t get too preoccupied with the FDA’s halt on its request for a Covaxin clinical trial in the U.S. 

The reality is that Occugen has never successfully commercialized any of its products in the development pipeline. In their 2020 10-K, it said that,  “We anticipate that our expenses will increase substantially in 2021 as compared to 2020 as we develop, seek an EUA for and potentially commercialize COVAXIN in the United States and prepare to commence human clinical trials with respect to OCU400, OCU410, and OCU200.” stated pg. 34.

So far, through the first nine months ended Sep. 30, Ocugen has operating losses of $43.5 million, up from $17.5 million a year earlier. They will surely lose more than $60 million for all of 2021, with 2022 expenses likely to be above $100 million if Covaxin is still in play. 

InvestorPlace’s Louis Navellier recently pointed out that the potential U.S. market for inherited retinal diseases is upwards of $31 billion, with a single dose costing as much as $2.1 billion.

He believes the combination of OCU400’s potential with a Covaxin longshot makes OCGN an excellent long-term growth stock. 

I respectfully disagree. At the end of September, Ocugen had an accumulated deficit of almost $70 million. It will almost certainly be over $100 million by the end of the year. There are plenty of better biotech growth stocks to buy with significantly better chances of long-term success.

If you bought last December and are still holding, it’s time to give thanks for your bounty and move on to the next biotech adventure. Unfortunately, this one is about to come to an unfortunate end. 

On the date of publication, Will Ashworth 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.

Will Ashworth has written about investments full-time since 2008. Publications where he’s appeared include InvestorPlace, The Motley Fool Canada, Investopedia, Kiplinger, and several others in both the U.S. and Canada. He particularly enjoys creating model portfolios that stand the test of time. He lives in Halifax, Nova Scotia.