The Spectacular 770% Surge of a Biotech Stock in Just 12 Weeks
The Spectacular 770% Surge of a Biotech Stock
(Bloomberg) -- A Korean biotechnology stock has surged more than 700% since August as investors looked beyond an earlier failed clinical study in favor of the prospect of its cancer drugs reaching the market.
HLB Inc. surged as much as 24% in early trading Tuesday. The shares soared by the daily limit of 30% yesterday after Chief Executive Officer Jin Yang-Gon told local media that the company will develop five cancer drugs in the next five years. The company now has the second-most valuable stock on Kosdaq, with a market capitalization of $6.4 billion. It is also the biggest winner among 1,350 small-cap stocks in the past three months.
The company said in September that its own study for a cancer drug called Rivoceranib was successful. It’s now scheduled to have a pre-new-drug-application meeting on Oct. 24 with U.S. Food & Drug Administration officials, according to its Oct. 18 statement. A company spokesman couldn’t immediately be reached by Bloomberg.
In July, HLB shares touched their lowest level this year following an announcement a month earlier that clinical research for its cancer drug failed.
“Most of the traders are apparently retail investors, seemingly looking for a yield from some biotech stocks that plunged with botched clinical researches recently,” said Heo Pil-Seok, chief executive officer at Midas International Asset Management Ltd. “Money is so abundant everywhere, and there’s herd behavior in the market.”
To contact the reporter on this story: Heejin Kim in Seoul at hkim579@bloomberg.net
To contact the editors responsible for this story: Lianting Tu at ltu4@bloomberg.net, Margo Towie, Naoto Hosoda
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