[Kim Saemi, Edaily Reporter] Peptron and HLB Group companies plunged to their daily lower limits on July 10 amid separate setbacks. Despite the sharp sell-offs, buying momentum spread across the broader KOSDAQ market, lifting many other biotech stocks.

Peptron Hits Limit-Down as CEO Remarks Fuel Confusion

According to KG Zeroin’s MP DOCTOR, Peptron closed at 111,600 won, down 47,700 won, or 29.94%, from the previous session.

The sell-off followed remarks made by CEO Choi Ho-il at the “Shinhan Bio Forum in Daejeon 2026” the day before. Choi stated that Peptron was developing “an entirely different peptide formulation” with Eli Lilly and that tirzepatide was not part of the project. The stock immediately fell to its lower limit in after-hours trading.

Peptron sought to mitigate the fallout with a notice issued at 8 a.m., stating that joint research involving multiple compounds—including next-generation obesity and diabetes drug candidates and central nervous system treatments—was proceeding as planned.

The company also stated that the research did not focus on a single commercialized product. However, the wording could be interpreted as either including tirzepatide among several research targets or referring only to next-generation compounds other than tirzepatide.

Investors initially interpreted the statement to mean that tirzepatide was not part of the program, sending the stock to its daily trading limit during the regular session.

Around noon, Peptron revised the notice to state that the joint research included “the product mentioned at the forum,” as well as next-generation obesity, diabetes, and CNS candidates. The phrase was widely interpreted as referring to tirzepatide. Shares briefly moved off the lower limit before falling back again.

The revised notice was seen as effectively reversing Choi’s earlier remarks. Internally, however, the company is understood to interpret his comments as meaning that tirzepatide had previously been covered by a material transfer agreement with Lilly but was not part of the current joint research program.

“The remarks came directly from the CEO at an investor relations event, making it difficult to quickly restore confidence despite the company’s clarification,” said an investment industry official.

Another official noted that investor confidence had already been eroded by delays in technology evaluation and the construction of Peptron’s second Osong plant. The official added that confidentiality obligations may also limit the company’s ability to provide a detailed explanation.

Third CRL Sends HLB Group Shares Plummeting

HLB disclosed at 7:44 a.m. that it had received a third complete response letter (CRL) from the U.S. Food and Drug Administration regarding the combination of rivoceranib and camrelizumab as a first-line treatment for liver cancer.

The FDA cited deficiencies in current Good Manufacturing Practice at Jiangsu Hengrui Pharmaceuticals’ manufacturing facilities and stated that a reinspection could be conducted if necessary.

The news sent HLB and most listed HLB Group companies to their daily trading limits.

HLB dropped 29.89%, while HLB Pharmaceutical, HLB Life Science, HLB Therapeutics, HLB Innovation, and HLB BioStep all fell by around 30%. HLB Panagene, HLB Genex, and HLB PEP also suffered steep losses.

Concerns over approval had already been mounting because no inspection related to Hengrui’s facilities had been publicly confirmed. HLB posted four notices on its official blog that day, but the explanations failed to reverse investor sentiment as questions arose regarding information sharing between the partners.

HLB stated that the inspections were not pre-approval inspections for the new drug application, but rather routine or surveillance cGMP inspections of Hengrui’s drug substance and drug product facilities.

According to HLB, the FDA inspected the drug substance facility in April and the drug product facility in July. Hengrui received a Form 483 following the first inspection, submitted corrective materials, and was preparing a response to the findings from the second inspection.

HLB stated that the FDA was unable to approve the therapy because rivoceranib-related products were manufactured at the same facilities and their cGMP compliance had not been confirmed, even though the drug itself was not the direct target of the inspections.

The company emphasized that the latest CRL raised no additional concerns regarding clinical data, efficacy, safety, or previously submitted chemistry, manufacturing, and controls (CMC) documentation. It also noted that no separate corrective actions were requested for the manufacturing processes of rivoceranib or camrelizumab.

Another concern is the apparent gap in information sharing between Hengrui and Elevar Therapeutics. HLB stated that Hengrui viewed the inspections as general cGMP reviews not directly related to the rivoceranib application and therefore did not notify Elevar in advance.

As a result, Elevar only learned later that the inspections had taken place and that a Form 483 had been issued. The incident raised questions about whether regulatory risks were communicated promptly, despite the fact that the key products are manufactured at the same facilities.

The damage to credibility may weigh more heavily on HLB Group’s valuation than the approval delay itself. Much of the group’s valuation had been based on expectations for U.S. approval and commercialization of rivoceranib. HLB Pharmaceutical, which is pursuing a large-scale rights offering, may also face additional pressure from weakened investor sentiment.

Broader biotech sector rises on KOSDAQ buying

Despite the setbacks at Peptron and HLB, the broader biotech sector posted strong gains.

Syntekabio rose 30% and Anterogen gained 29.94%, both hitting their daily upper limits. ToolGen climbed 25.11%, while Protina advanced 13.46%. Large-cap biotech company Alteogen rose 24,000 won, or 8%, to 324,000 won.

The gains were attributed to buying momentum spreading across the KOSDAQ market after trading had recently been concentrated in a small group of large-cap stocks amid declining retail activity.

A program-buying sidecar was triggered, and the KOSDAQ index recovered to the 800 level, signaling a rapid improvement in investor sentiment.

“Buying momentum spread across the KOSDAQ and lifted a wide range of stocks,” said a financial investment industry official. “Large-cap stocks were broadly strong, with the exception of Peptron and HLB, which were hit by company-specific negative developments.”