SillaJen shares bottomed out on Aug. 2 on news that the global phase 3 clinical trials of its signature liver cancer treatment Pexa-Vec are likely to be suspended.
The biotech firm trading on South Korea’s tech-heavy bourse Kosdaq, took a 30 percent loss. As a result, the market cap fell to 2.2 trillion won ($1.8 billion), from 3.2 trillion won the previous day. SillaJen was the sixth-largest Kosdaq-listed firm by market cap, as of Aug. 2.
The news came as the independent data monitoring committee recommended Pexa-Vec’s clinical trials be suspended, after conducting a futility analysis. The reason for the recommendation has yet to be disclosed. SillaJen said it plans to report DMC’s recommendation to the US Food and Drug Administration.
Busan-headquartered SillaJen made a disclosure of the result at 8:23 a.m., prior to the start of trading.
While the announcement cast a shadow on SillaJen’s plan to commercialize its first drug involving a cancer cell-killing virus, market watchers said investors should be overly concerned.
“The deterioration of investor sentiment toward the pharmaceutical and biotech industry seems inevitable due to recent negative issues,” Lee Tae-young, an analyst at KB Securities, wrote in a note to investors. “Regardless of the negative issues, the pharmaceutical and biotech industry is boosting research and development expenses across the board, which is leading to noteworthy technology transfer deals.”
