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Photo courtesy of Yonhap News |
[Alpha Biz= Kim Jisun] Shares of Samchundang Pharm, once dubbed a “KOSDAQ emperor stock,” plunged to the daily limit on March 31, falling 29.98% to KRW 829,000 in a single session amid mounting investor concerns and allegations of stock manipulation.
The stock tumbled sharply from its previous close of KRW 1,184,000, wiping out KRW 355,000 in value in just one day. After surging more than 400% from around KRW 240,000 earlier this year, the share price fell below the KRW 900,000 level in a dramatic reversal.
The decline followed the company’s disclosure of its development plans for oral insulin and obesity treatments using its proprietary S-PASS platform at its recent shareholders’ meeting. Samchundang Pharm stated that its oral insulin could potentially replace injectable forms and that its oral obesity treatment could lower production costs while enhancing global competitiveness.
The company also announced a licensing agreement in the United States for generic versions of oral semaglutide drugs, including Wegovy and Rybelsus. However, it did not disclose the counterparty and noted that the contract could be terminated if commercialization proves unfeasible.
Market skepticism quickly emerged regarding the feasibility of these plans, particularly given that key pipeline assets still require further clinical validation. This uncertainty appears to have weighed heavily on investor sentiment.
Adding to the pressure, a blogger raised allegations of stock manipulation, labeling the company a “stock rigging play” and outlining 12 points of suspicion. Samchundang Pharm strongly denied the claims, calling them “groundless” and announcing plans to file legal action for defamation and business interference.
The controversy has continued to escalate, with some retail investors criticizing the company’s aggressive legal stance. One investor commented on an online forum that “while price volatility is expected, suing a blogger may not align with the company’s image.”
Further dampening sentiment, CEO Jeon In-seok disclosed plans on March 24 to sell 265,700 shares—worth approximately KRW 250 billion—through a block deal. The anticipated large-scale share sale by the controlling shareholder was widely interpreted as a signal of a potential peak, accelerating the sell-off.
Samchundang Pharm had recently risen to become the largest company on the KOSDAQ by market capitalization, driven by expectations surrounding overseas licensing deals and new drug development. However, the sharp decline has heightened uncertainty over its future stock performance.
The drop also impacted related investment products. The TIME KOSDAQ Active ETF, which holds Samchundang Pharm as its largest position at 8.94%, fell 6.81% on the same day.
Alphabiz Reporter Kim Jisun(stockmk2020@alphabiz.co.kr)
