Meanwhile GI Innovation rallied on news that partial response was observed in a late-stage cancer patient during clinical trials of its immuno oncology drug. ImmuneOncia on the other hand saw its shares tumble sharply following plans for a won 120 billion rights offering.
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According to KG Zeroin’s MP Doctor(formerly Market Point) on the 9th, Jeil Bio’s shares jumped 29,948%(won 622,920) day on day to close at won 625,000. Despite the eye catching gain Jeil Bio is an animal pharmaceuticals manufacturer that is on the verge of delisting.
Earlier, the KOSDAQ Market Division of the Korea Exchange announced on the 2nd that it would resume delisting procedures for Jeil Bio. This followed a court decision on January 8 rejecting the company’s request for an injunction to suspend the delisting decision, clearing the way for the exchange to proceed.
Jeil Bio was deemed subject to delisting due to issues with its audit opinion and failed to resolve those issues during the improvement period, leading to a final delisting decision. The key reason was not short-term earnings weakness, but rather concerns over financial credibility and going-concern viability.
Trading in Jeil Bio shares had been suspended through the 6th, and when trading resumed on the first session after the weekend(the 9th), the stock price spiked. This move is widely attributed to the start of liquidation trading combined with the effects of a 1,500-to-1 capital reduction(share consolidation).
According to disclosures, upon completion of the capital reduction, outstanding common shares will shrink from 29,129,064 shares to 19,419 shares. Shareholders holding fewer than 1,500 shares effectively lose share ownership, a point that has sparked controversy. The company previously announced plans to buy out fractional shares at won 752 per share in cash.
Industry observers say Jeil Bio’s price on the day cannot be regarded as a price formed through normal market mechanisms. Stocks undergoing delisting procedures typically see extremely limited trading volume, and in some cases, the execution of just a handful of shares can send prices soaring by dozens of times.
Daily price limits effectively lose their meaning. While a price is displayed on trading screens, it is difficult to call it a “market price” reflecting broad supply and demand.
Analysts note that Jeil Bio’s price surge is a textbook example frequently seen in delisting bound stocks, emphasizing that investors should focus first on where a company stands in the delisting process, rather than headline price movements.
◇GI Innovation Confirms Partial Response in Immuno-Oncology Trial
Shares of GI Innovation also surged on the day, closing at won 15,260, up 16.05%(won 2,110) from the previous session. The rally was driven by news that a partial response had been confirmed in clinical trials of the company’s immuno-oncology drug candidate.
According to GI Innovation, a partial response was observed in a Merkel cell carcinoma patient during a Phase 1b monotherapy trial of its subcutaneous(SC) immuno-oncology candidate GI-102. Partial response indicates a meaningful reduction in tumor size. The result drew particular attention as the patient was a late-stage cancer patient in their late 70s.
The patient, who has Merkel cell carcinoma(MCC), a rare and aggressive skin cancer, is being treated at Memorial Sloan Kettering Cancer Center(MSK) in the U.S. After receiving GI-102 SC monotherapy at a dose of 0.65 mg/kg, tumor lesions were reduced by 68% within six weeks, confirming a partial response.
GI-102 had previously demonstrated a complete response, in which tumors disappeared entirely, in earlier trials last year. That patient has maintained complete remission for six months to date.
The fact that GI-102 is administered via subcutaneous injection rather than intravenous infusion has also drawn attention as a point of differentiation in the global market.
A GI Innovation official said “The stock had been under pressure previously, so a technical rebound combined with confirmation of partial response in the GI-102 trial appears to have driven today’s strong performance.”
◇ImmuneOncia Slumps on won 120 Billion Capital Raise…Yuhan Corporation “Reviewing Participation”
Shares of ImmuneOncia, a new drug development subsidiary of Yuhan Corporation, fell sharply. The stock closed at won 8,800, down 9.28%(won 900) from the previous session.
The decline followed the company’s board decision on the 6th to pursue a won 120 billion rights offering. Analysts say the move triggered both near-term supply pressure and a deterioration in investor sentiment.
Investor sentiment toward companies pursuing capital raises has weakened amid a series of large-scale rights offerings across the biotech sector. Lunit, for example, recently announced a won 250 billion rights offering, after which its share price also fell sharply.
ImmuneOncia’s planned capital increase involves issuing new shares equivalent to approximately 23% of existing outstanding shares, with the offer price set at roughly a 25% discount to the reference market price. The move comes just 10 months after the company’s KOSDAQ listing in April last year.
The funds raised will be used for operating purposes, primarily to support research and development(R&D). In fact, ImmuneOncia reported won 111 million in revenue last year down 83% year on year while its operating loss widened to won 28.3 billion a 126% increase, largely due to higher R&D spending.
Market participants are closely watching whether Yuhan Corporation ImmuneOncia’s parent company will participate in the rights offering. If Yuhan joins the capital raise, the move could be interpreted as a vote of confidence in ImmuneOncia’s growth prospects, rather than merely a defensive financing measure.
A Yuhan Corporation official said “We are reviewing participation in the rights offering.”
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