This story has been corrected. A quotation from the company's co-founder has been updated. A fuller explanation of Organovo's research has been added. And it has been noted that the company intends to conduct earnings calls with analysts.
The company's method, while novel, offers no advantages over those of competitors. Further, the company's products are behind when it comes to proving their value with scientific research.
San Diego-based Organovo uses 3-D bioprinting technology to create cell cultures that pharmaceutical companies can use to experiment on with their developing drugs before they experiment on an animal or a human subject. Organovo specializes in a type of cell culture called liver assays that are used to test the toxicity of chemical compounds.
The problem for investors is that this technology doesn't offer new advantages in the process over competitors.
"Organovo's bioprinter is really like an automatic dispenser," says Guohao Dai, an assistant professor in the department of biomedical engineering at the Rensselaer Polytechnic Institute in upstate New York. Dai has been studying 3-D bioprinting for six years. He doesn't think a 3-D bioprinter is necessary to make liver assays.
"Organovo isn't using the full power of 3-D printing," said Dai. "3-D printing is used to control many different cells and tissues and to make bigger ones. But a liver is a very simple, small cell, and it aggregates on its own. You don't need a 3-D bioprinter for this, you can even just drop it on the well by hand."
Gabor Forgacs, the company's co-founder, explained this in 2013 in an article in Popular Science:
"The magic," he says, "happens after printing has taken place." Therein lies the biggest misconception about bioprinting: What most people think of as the finished product-the newly printed cellular material-isn't finished at all.
In response to questions for this article, Organovo pointed out this study from 2010 that discusses the importance of self-assembly.
The "magic" happens for Organovo products as well as its competitors' -- and without the use of 3-D bioprinting. There is, however, one important thing that separates them: There is less scientific evidence showing the effectiveness of Organovo's 3-D bioprinter-driven technology.
A good example of a study published conducted using Organovo's liver assays was one with Roche in 2014, and that only tested a single compound. Organovo's competitors have conducted studies with more compounds.
San Diego, Calif.-based Regenemed, a privately held competitor of Organovo's, conducted a study with Roche two years ago of many compounds showing their usefulness for testing drugs.
"A difference with only one compound is not a significant finding," says Dawn Applegate, Ph.D., the founder and CEO of Regenemed.
Competitors InSphero and Hepregen are also publishing big studies.
"Genentech recently at a conference in Boston presented data where they tested 54 liver toxic compounds using our system," says Dr. Jan Lichtenberg, the CEO of Switzerland-based InSphero, an Organovo competitor. "I don't want to discount the work that Roche and Organovo have done on this one compound, but the scientific bar is much higher than what they've shown. Hepregen [another competitor] has also published tons and tons of scientific publications, where they've tested 30 or 40 tricky compounds together. There isn't a lot of publically available information on Organovo's research. It isn't in scientific journals."
In response to questions for this article, Organovo points out that it has published more than one scientific study. Many of them focus on the company's core bioprinting technology, rather than the efficacy of its product in testing various compounds. For instance, the company published a well-read study in the Biofabrication journal in 2010.
The company said it is in the process of working on additional studies. A representative pointed out that the company's liver research and development program only reached its "functional validation milestone in late 2013" and that it takes a year or more to publish in peer-reviewed scientific journals.
InSphero, which counts the top 15 pharmaceutical companies in the world among its clients, is valued at less than a quarter of Organovo based on a recently completed private-equity raise, according to Lichtenberg. Meanwhile, Organovo has yet to announce any major pharmaceutical company clients. Organovo's market capitalization is just under $500 million.
Organovo doesn't conduct earnings calls, which is rare for a publicly traded company. This is a testament to the company's lack of scientific evidence of the usefulness of its 3-D bioprinting technology. The company has said that it will begin conducting earnings calls as it transitions from a "development-stage" company to one that has revenues.
"We launched a commercial product in November 2014 and expect to begin reporting revenues shortly," the chairman and CEO Keith Murphy said in an email to TheStreet.
"I like the 3-D bioprinting technology and think it can make meaningful binds, for example, if you need to reconstruct the cartilage of an ear that got damaged, or a nose," said Lichtenberg of his competitor's methods. "But any advantage the 3-D printing technology has on making a microtissue cell culture model is not understood."