NewG Lab Pharma's stock price plunged by nearly 50 percent in two days, raising questions among industry watchers.
At 11 a.m. Monday, the company shares stood at 6,560 won ($5.33), down by 1,560 won, or 19.41 percent, from 8,140 won the previous trading day’s closing price.
The stock price of NewG Lab Pharma fell to 5,900 won in mid-morning trade. Compared to Friday, it fell 49.23 percent in two days.
On Monday, the company’s stock dropped to its lower limit, breaking the 10,000 won threshold and plunging by 29.95 percent from 11,620 won on Friday.
The price drop drew the attention of market watchers. On Monday, when the stock hit the lower limit, the website of the NewG Lab Pharma could not be opened all day due to excessive traffic.
On Tuesday, the company posted a statement on its website, saying there are no problems with the ongoing clinical trials.
“We express deep regrets for investors suffering from stock price drops,” CEO Park Dae-woo said. “However, our clinical trials are progressing smoothly regardless of the stock prices.”
Park explained that the company is developing ‘KAT,” a candidate substance for a new metabolic anticancer drug and non-small cell lung cancer (NSCLC) ROS-1 mutant treatment candidate substance, Taletrictinib, through its drug-developing subsidiary, NewG Lab Pharma Therapeutics.
KAT has selected liver cancer as its first indication and is conducting phase 1 clinical trials. The company has successfully completed its administration on the first patient at Seoul National University Hospital until the fourth week and started the second-cycle administration, Park said.
“The drug administration on the first patient is progressing smoothly without any side effects, including dysphagia, during the process,” he added.
Park also explained that the phase 2 clinical trial of Telectinib is also going on smoothly as all three patients in the primary treatment group show partial remission results, adding that partial remission effects are also observed in three of six patients in the secondary treatment group.
A rumor was circulated once that a personal problem occurred to Dr. Koh Young-hee, the chairman and CEO of the NewG Lab Pharma’s U.S. corporation, but it has not been confirmed.
Korea Biomedical Review contacted NewG Lab Pharma to ask the exact reason for the stock price decline and the company's countermeasures, but all its main numbers were turned off and could not be reached.