[Edaily KIM SUNG-JIN Reporter] On the 11th, the pharmaceutical and biotech sector showed strength, with both KMPHARMACEUTICAL Co.,Ltd.(225430)and BL Pharmtech(065170)hitting their daily price limits. Notably, KMPHARMACEUTICAL Co.,Ltd. saw an ironic situation unfold as its stock price surged after it was revealed that it had become the first domestic biotech company to be delisted. Meanwhile, SK BIOPHARMACEUTICALS(326030)saw its stock price decline due to negative news regarding the U.S. Food and Drug Administration (FDA) placing a partial hold on its clinical trials.

According to KG Zeroin’s MP DOCTOR (formerly Marketpoint) on that day, KMPHARMACEUTICAL Co.,Ltd.’s stock price hit the daily price limit, closing at 682 won. BL Pharmtech also closed at 2,720 won, up 29.83% from the previous day. SK BIOPHARMACEUTICALS closed at 79,400 won, down 4.8% from the previous day.

Hitting the Daily Upper Limit

Despite Delisting Notice… KMPHARMACEUTICAL Co.,Ltd.’s “Roller Coaster” Ride

KMPHARMACEUTICAL Co.,Ltd.’s stock price surged immediately after the market opened today and remained at the daily upper limit steadily from around 12:30 p.m. until the market closed.

The stock price has recently exhibited extreme volatility. The price, which stood at 1,330 won on the 1st of this month, hit the daily lower limit on the 2nd, dropping to 931 won, and fell further to 710 won on the 4th—a decline of over 46% in just three trading days. It then exhibited rollercoaster-like movements, hitting the daily upper limit again on the 7th.

It is believed that KMPHARMACEUTICAL Co.,Ltd.’s extreme stock price volatility on that day was influenced byan exclusive article in E-Daily’s pharmaceutical and biotech premium content section, “Pharm E-Daily,” titled “KMPHARMACEUTICALCo .,Ltd. Fails to Exceed 20 Billion Won Market Cap… First Delisting in K-Bio.”According to the article, the KOSDAQ Market Division of the Korea Exchange has finalized delisting procedures for KMPHARMACEUTICAL Co.,Ltd. due to its common stock market capitalization falling below the required threshold and has decided to begin liquidation trading next week.

Consequently, investors are advised to exercise caution. Since KMPHARMACEUTICAL Co.,Ltd. is a micro-cap stock with a market capitalization of less than 5 billion won, its stock price can fluctuate significantly even with small amounts of capital. Furthermore, it is difficult to rule out the possibility of speculative capital seeking short-term gains ahead of the liquidation trading, as well as buying by some shareholders attempting to drive up the stock price to prevent delisting.

KMPHARMACEUTICAL Co.,Ltd.’s delisting from KOSDAQ marks the first such case in the pharmaceutical and biotech industry. Since last July, when financial authorities raised the minimum market capitalization threshold for KOSDAQ from 15 billion won to 20 billion won to accelerate the delisting of struggling companies, firms have been gradually being delisted one by one.

Since its establishment in 2001, KMPHARMACEUTICAL Co.,Ltd. has solidified its position in the domestic infant and toddler oral care market, led by its “Pororo Toothpaste.” In addition to masks, hand sanitizers, and facial tissues, the company has expanded its business scope to include skincare and scalp care by operating its second factory in Pyeongtaek, Gyeonggi Province.

However, the company has faced a crisis in recent years as sales have declined and operating losses have widened. Sales, which exceeded 20 billion won in 2021, fell to around 16 billion won last year, and the company has posted consecutive losses from 2022 through this year.

BL Pharmtech Hits Daily Price Limit… Anticipation Surrounding ML301 Technology Transfer

On that day, BL Pharmtech’s stock price also showed strength, hitting the daily upper price limit. While BL Pharmtech’s stock price remained in the 300-won range as recently as early January of this year, it garnered significant attention on the KOSDAQ market by hitting the daily upper price limit 12 times between January and February alone. On February 10, the stock price even rose as high as 8,150 won.

BL Pharmtech is a company engaged in the health functional food business and the development of Molecular Glue-based Targeted Protein Degradation (TPD) anticancer drugs; its anticancer drug development business, in particular, is drawing significant market interest. BL Pharmtech’s core pipeline is “ML301,” an innovative new anticancer drug candidate targeting intractable solid tumors.

Currently, BL Pharmtech is exploring the possibility of technology transfer for ML301 with domestic and international pharmaceutical companies. Most importantly, it is reported that ML301 has the advantage of being expandable not only as a standalone new drug but also as an antibody-drug conjugate (ADC). The stock’s strong performance today is analyzed as being driven by growing expectations regarding the technology transfer of BL Pharmtech’s core pipeline, ML301.

SK BIOPHARMACEUTICALS Down 4.8%

…

Fallout from Opakalim Clinical Trial Suspension

SK BIOPHARMACEUTICALS’ stock price fell

4.8

% from the previous day to 79,400 won. Although it dropped as low as 77,200 won at one point during the trading session, it recovered to the 79,000-won range. SK BIOPHARMACEUTICALS’s stock decline today is believed to be due to the partial suspension of the U.S. Phase 2/3 clinical trial for “Opakalim” (BHV-7000), a new epilepsy drug candidate scheduled to be licensed from U.S.-based Biohaven.

Opacalym is a new epilepsy drug candidate for which SK BIOPHARMACEUTICALS has signed an exclusive global license agreement with Biohaven worth up to $795 million (approximately 1 trillion won). This is the largest-scale instance of a Korean company acquiring a new drug candidate from an overseas firm.

SK BIOPHARMACEUTICALS held an online briefing this morning and stated, “Biohaven is responding swiftly and plans to submit additional preclinical data to the FDA as early as the end of this month,” adding, “We expect the hold to be lifted sometime in October or November.”

This clinical hold stems from nonclinical toxicity findings; specifically, toxicity was observed when a specific metabolite of Opacalym was administered to rats. The FDA requested additional data to determine whether this toxicity is specific to rodents or if it is relevant to humans as well.

In response, SK BIOPHARMACEUTICALS explained, “We were fully aware of this prior to signing the contract and proceeded with the agreement only after thoroughly reviewing all risks on our own.” To date, Opakalim has been tested in clinical trials involving over 1,200 participants, and no adverse events directly linked to these nonclinical toxicity findings have been identified.

Among the ongoing Phase 2 and 3 clinical trials for Opakalim (RISE2 and RISE3), patient enrollment for the RISE3 trial has already been completed. SK BIOPHARMACEUTICALS anticipates that the announcement of top-line results, scheduled for the second half of this year, will proceed as planned.