The prospect has once again dimmed for Kolon Life Science’s osteoarthritis gene therapy Invossa-K to survive in the market.

A day before the pleading of the case of Kolon Life Science, which seeks to stop the government from nullifying the license of Invossa, prosecutors on Wednesday sought arrest warrant for two Kolon executives for submitting false data of the gene therapy.

At the first pleading the next day, prosecutors submitted Kolon TissueGene’s 2004 research note as evidence, which indicated that the company had known Invossa contained kidney-derived cells (GPS-293 cells), instead of cartilage-derived cells.

The evidence is a disadvantage against Kolon Life Science.

The Seoul Administrative Court held the first pleading Thursday for the case of Kolon Life Science against the Ministry of Food and Drug Safety to cancel the ministry’s decision to revoke the Invossa license.

Kolon Life Science claimed that it had not been aware until February that the ingredient cells of Invossa were 293 cells, not cartilage-derived, as indicated in the submitted data when seeking approval for the therapy years ago. As the company has used the same transduced cells from development to clinical trials and approval, there is no safety concern for Invossa, the company argued.

“Kolon TissueGene, the developer of Invossa, was to blame for making a mistake concerning the second fluid of Invossa from the stage of building ‘research cell bank.’ However, it notified the authorities of the second fluid’s tumorigenicity, and confirmed that the cells in the second fluid were killed completely through radiation, as recommended by the authorities,” a lawyer representing Kolon Life Science said. “We are convinced that there is no safety risk.”

The company attributed the cell change mishap to “the failure of filtering.” The much-talked-about 293 cells should have been filtered out, and only retroviruses cultured from 293 cells should have been inserted to the cartilage-derived cells. However, somehow, those 293 cells were not filtered out, Kolon said, adding that it was still identifying the exact cause of the filtering failure.

The food and drug ministry rebutted, saying, “The 293 cells and retroviruses have different sizes of cells, so the cells must have been filtered out for sure. Even if there was a mistake, the company should have presumed that cells could have been changed, considering the results of several tests.”

The hearing also revealed that Kolon TissueGene had known that the 293 cells were mixed in Invossa in 2004, immediately after building the “master cell bank.”

The preliminary document submitted by the food and drug safety ministry to the court included a research note by Kolon TissueGene written in 2004. The note had a written statement, “293 cells were detected in Invossa.”

The court cited the note and requested Kolon Life Science to confirm it.

In response, Kolon said, “After establishing the cell bank, we did not feel the need to identify the source of Invossa cells. There was no request for verification from the U.S. Food and Drug Administration or the food and drug safety ministry.”

The company said it might not have conducted a separate test to verify the cells, but it would check exactly what happened.

The research note reverses Kolon’s claim that it has not been aware of the mislabeling until early this year. Industry watchers are paying attention to what answer Kolon will come up with. If the answer is not convincing enough, Kolon Life Science will be at a disadvantage.

Observers have raised suspicion that Kolon Life Science may have known the labeling error before obtaining the license for Invossa.

In March 2017, before winning the Invossa license, Kolon TissueGene received a test result from a contractor that the second fluid of Invossa contained 293 cells. On July 13, 2017, immediately after obtaining the Invossa license, Kolon Life Science received an email from TissueGene about the mislabeling. Besides, the company detected gag·pol, a particular gene that exists only in 293 cells, in a polymerase chain reaction (PCR) test in the past. However, the company did not submit this data when seeking approval for Invossa, and this raised the suspicion.

The court asked Kolon to clarify whether it had known the mislabeling.

“In the past, PCR tests were often sensitive and showed very different results depending on the test conditions. We once detected gag·pol genes in the first fluid of Invossa, which were 100 percent cartilage-derived cells, so we thought we ran PCR tests in a wrong way,” Kolon said. “After that, we stabilized the test method, and we didn’t detect gag·pol in PCR tests in 2003.”

However, prosecutors suspect that Kolon Life Science deliberately lied about Invossa data. The prosecution sought an arrest warrant for two Kolon executives for the obstruction of justice by submitting fake data. The decision on whether to arrest them will come out around Monday next week.

The court will hold a second pleading on Dec. 19, after receiving evidence and safety verification plans from Kolon.