PharmAbcine announced that the Kosdaq Market Committee decided to delist its stock on Wednesday.

PharmAbcine can appeal the decision within 15 business days of the date of notification. If no appeal is made, the delisting process will proceed after the appeal period expires.

If an appeal is lodged, the Kosdaq Market Committee will reconvene within 20 business days to determine whether to uphold the delisting or grant a grace period for improvement.

The troubled PharmAbcine's stock has been suspended from trading since January of this year at a stock price of 2,915 won.

PharmAbcine initially planned a 30 billion won (21.6 million won) rights issue with PharmAbcine Diamond Club Companion Growth Equity No. 1 to secure funds for research, potentially leading to a change in management. However, the payment delay led to the withdrawal of the rights issue.

The constant failure to follow its disclosures, the company accumulated a total of 15.5 demerit points over the past year. Accumulating 15 or more demerit points within a year triggers a review of listing eligibility from the Kosdaq committee.

In May, the Kosdaq committee announced that an additional reason for the review of PharmAbcine’s listing eligibility had been met.

The reason cited was that the company's quarterly sales were below 300 million won. According to Kosdaq market listing regulations, if quarterly sales are below 300 million won, the company becomes subject to a listing eligibility review.

While such chaos was happening within the company, PharmAbcine's major shareholder changed to Tire Bank at the end of last year, creating a new corporate structure with Tire Bank Chairman Kim Jung-kyu at the helm.

As of Tuesday, the largest shareholder has shifted from Tire Bank to Kim.

During that time frame, the company’s founder, Yoo Jin-san, resigned from his CEO position on Jan. 29 and is currently reported to be serving as Chief Scientific Officer (CSO).

Following the change in major shareholders, the company is planning to expand its business objectives from its initial plans to develop new drugs for cancer and vascular diseases to include overseas resource development, non-ferrous metal product manufacturing and sales, electric vehicle component and charger manufacturing and sales, charging infrastructure business, and automated mobility manufacturing and sales.

The company plans to hold an extraordinary shareholders' meeting in August to elect a new board of directors and announce the new business objectives.

Meanwhile, if the Kosdaq committee decides to uphold the delisting, the decision will likely have a huge impact on the company’s retail investors.

As of Dec. 31 of last year, the company has 27,509 retail investors, with minority shareholders holding more than 84 percent of the company's total shares.

Challenges persist in biotech business

While the company may manage to remain listed on the stock exchange by changing its articles of incorporation, industry watchers stressed that the company’s initial business of developing new drugs for cancer and vascular diseases might not be able to recover as PharmAbcine’s bio-industry achievements remain lackluster.

In April of this year, the company voluntarily withdrew its phase 2 clinical trial plan for a combination treatment of Keytruda and olinvacimab in patients with metastatic triple-negative breast cancer.

PharmAbcine received approval for the phase 2 trial from the Human Research Ethics Committee (HREC) in Australia in Sept. 2021 and conducted the trial at four institutions in Australia, with Keytruda supplied by Merck (MSD).

The trial, initially planned to enroll 36 patients over approximately 42 months until 2025, was terminated early due to difficulties in patient recruitment.

"Rather than continuing this study with limited personnel and resources, we decided to terminate it early to focus on other ongoing research projects with better prospects,” the company said during that time.

However, other candidate substances are currently in early clinical stages, indicating that it will take years before the company actually starts showing results related to its bio-business.