[Song Young Doo, Edaily Reporter] South Korean pharmaceutical and biotech stocks traded lower across the board, with #JW Pharmaceutical and #OliX Pharmaceuticals drawing particular attention. JW Pharmaceutical surged nearly 15% as successful multinational Phase 3 results for its gout treatment epaminurad, combined with improving earnings, boosted investor sentiment. OliX, meanwhile, plunged 14% despite announcing positive research results showing the potential to deliver small interfering RNA (siRNA) to the brain via subcutaneous injection. Market observers said concerns over a potential share overhang may have weighed on the stock, as convertible preferred shares (CPS) issued last year approach the date when they become eligible for conversion into common shares.

JW Pharmaceutical Surges on Phase 3 Success and Earnings Momentum

According to KG Zeroin’s MP Doctor (formerly MarketPoint), JW Pharmaceutical closed at 30,150 won on Aug. 12, up 14.86%, or 3,900 won, from the previous session.

The rally was primarily driven by the successful multinational Phase 3 trial of epaminurad (Epaminurad·URC102), an investigational gout treatment. Epaminurad is an oral uricosuric drug that selectively inhibits human uric acid transporter-1 (hURAT1), reducing uric acid reabsorption in the kidneys and promoting its excretion. It is being developed for patients with hyperuricemia and gout.

The trial enrolled 612 gout patients at 52 sites across five Asian countries—South Korea, Taiwan, Thailand, Malaysia, and Singapore. The study compared the efficacy and safety of epaminurad at doses of 6 mg and 9 mg with febuxostat, a standard gout treatment.

The key result came from the 6 mg dose, which JW Pharmaceutical considers its primary development dose. For the primary efficacy endpoint, 50.0% of patients receiving 6 mg of epaminurad achieved serum uric acid levels below 6 mg/dL during the final three measurements of the main study period, compared with 38.3% of patients receiving 40 mg of febuxostat.

The difference in response rates was 12.0 percentage points. Epaminurad met the predefined non-inferiority criterion and also demonstrated statistical superiority. Its safety profile was comparable to that of febuxostat, with similar rates of treatment-emergent adverse events (TEAEs), adverse drug reactions (ADRs), and serious adverse events (SAEs). This comparison is particularly noteworthy because febuxostat 40 mg is the dominant treatment in South Korea’s gout drug market.

According to pharmaceutical market research firm UBIST, South Korea’s gout treatment market was worth approximately 41.1 billion won last year. Febuxostat products accounted for 34.7 billion won, or 84.4% of the market. Prescriptions for febuxostat 40 mg alone totaled approximately 26 billion won, representing more than 63% of the overall market.

However, the higher 9 mg dose of epaminurad failed to meet the statistical non-inferiority criterion against febuxostat 80 mg for the primary endpoint. The proportion of patients achieving serum uric acid levels below 6 mg/dL was 59.6% in the epaminurad 9 mg group and 63.3% in the febuxostat 80 mg group.

JW Pharmaceutical plans to proceed with the regulatory process focused on the 6 mg dose. The company is preparing a New Drug Application (NDA), targeting approval in South Korea in 2027. It also completed two pre-NDA meetings with the Ministry of Food and Drug Safety in July.

Improved earnings also appear to have bolstered investor sentiment. JW Pharmaceutical stated that the success of the Phase 3 trial, combined with its recent financial performance, was likely viewed positively by the market.

The results effectively shift the investment case for epaminurad from expectations surrounding preclinical or early-stage clinical development toward the more tangible prospect of regulatory approval.

OliX Drops 14% Despite Demonstrating Brain Gene Silencing Following Subcutaneous Injection

OliX moved in the opposite direction. Despite announcing positive R&D results, its shares closed at 113,400 won, down 14.03%, or 18,500 won, from the previous session.

The company unveiled preclinical results from its second-generation OASIS-CNS platform targeting central nervous system (CNS) diseases. OASIS-CNS uses siRNA to silence target genes associated with CNS disorders. OliX is developing a second-generation platform that combines its siRNA technology with a blood-brain barrier (BBB) shuttle, with the aim of enabling subcutaneous (SC) or intravenous (IV) administration instead of intrathecal administration.

In simpler terms, the technology is designed to deliver RNA therapeutics to the brain via the bloodstream following a conventional subcutaneous injection, rather than requiring direct administration near the central nervous system.

When OliX administered the candidate subcutaneously and intravenously in mice, target gene silencing was observed across multiple brain regions, including deep-brain areas such as the striatum and hippocampus. Gene-silencing rates exceeded 70% to 80% in some regions.

The findings go a step beyond simply demonstrating that siRNA reached the brain. They provide early proof of concept (PoC) that the siRNA crossed the blood-brain barrier (BBB) and actually suppressed target gene expression in brain tissue.

The stock, however, moved sharply in the opposite direction. OliX stated that it was not aware of any negative developments involving its business or R&D programs that could explain the decline. The company noted that it understands some market participants have raised concerns about the approaching date when CPS issued last year become eligible for conversion into common shares.

CPS can be converted into common shares when predetermined conditions are met. Such a conversion could increase the number of common shares outstanding and dilute existing shareholders. If the converted shares are subsequently sold on the market, they could also create short-term selling pressure.

Importantly, the arrival of the conversion eligibility date does not mean that the shares will be immediately converted and sold. Whether investors exercise their conversion rights, when they do so, and whether they hold or sell the resulting common shares are separate decisions.

It would therefore be premature to attribute OliX’s sharp decline solely to the CPS issue. Still, the company said concerns that the potential conversion could create a stock overhang—a large block of shares that may potentially come onto the market—may have weighed on investor sentiment.