Stock Price Halves Right After Approval... '18.2 Billion Won 'Eat and Run' Amid Retail Investors' Tears

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Normally, a company's stock price tends to rise when clinical trials are approved. However, right after Genencell's clinical trial approval, Sejong Medical, its largest shareholder, saw a massive sell-off that caused its stock price to plummet by half. While minority shareholders suffered heavy losses, someone managed to pocket 18.2 billion won in profits.

Reporter Kim Hye-min has the details.

[Reporter]

In July 2021, an investment firm named Time Investment and four investment associations acquired a stake of over 50% in the medical device company Sejong Medical.

Sejong Medical's stock price, which had been in the 3,000-won range, began to rise from this point on.

On October 19, Sejong Medical invested 11.3 billion won to become the largest shareholder of Genencell.

One week later, the Ministry of Food and Drug Safety approved Genencell's clinical trial plan.

However, Sejong Medical's stock price began to plummet.

This was because three of the investment associations that had entered three months prior—the 2nd, 3rd, and 4th largest shareholders—dumped all their holdings in just two days.

The stock plunged over five trading sessions, dropping to 3,825 won.

Just three months from purchase to sale, they cashed out after making 18.2 billion won in profits.

Ultimately, it turned out that Genencell was used as a catalyst to boost Sejong Medical's stock price.

Meanwhile, a similar incident surrounding Genencell occurred in September 2020 as well.

A company called Gold Pacific formed a consortium with Genencell to develop a COVID-19 treatment candidate, causing its stock price to more than double on the back of being related to the theme.

The same entities appeared consecutively here.

Time Investment, a major shareholder of Sejong Medical, had also invested in Gold Pacific to reap a 700 million won profit. Byron, which had similarly invested in Gold Pacific's convertible bonds, and one of Gold Pacific's internal directors became members of one of Sejong Medical's investment associations.

In both 2020 and 2021, the same investment firms and individuals utilized Genencell's clinical trial approvals to artificially inflate stock prices.

Their specific identities and whether actual stock manipulation took place have not been uncovered.

Subsequently, Sejong Medical even received a decision for delisting in June of this year, and Gold Pacific's stock price has also plummeted, trading at around 1,000 won.

[Individual A / Sejong Medical Minority Shareholder: We invested looking at the company's future, but we suffered heavy losses because of stock-manipulating forces that inflated the stock price using source materials to make a profit...]

Minority shareholders who suffered losses due to the delisting of Sejong Medical reach 30,000 people.

(Video Editing: Kim Jun-hee, Design: Park Taeyoung and Park Chun-woong)
※ Please note: This article was translated by AI and may contain errors.