Chinese Firm Says Work Still Needed on Drug After Shares Surge

Guangzhou Baiyunshan Pharmaceutical Holdings Co., whose stock surged the most in two years Friday on reports one of its medicines could potentially inhibit Covid-19, said more studies are needed on the treatment.

Shares of Baiyunshan climbed 13% in Hong Kong and by the 10% limit in Shanghai on Friday after one of the nation’s top medical advisers reportedly said one of its treatments could potentially inhibit Covid-19. Guangzhou-based Nanfang Daily cited Zhong Nanshan as saying Baiyunshan’s “banlangen” product was effective in a series of in-vitro studies. Zhong is a senior medical adviser to Beijing who confirmed the risk of human-to-human Covid-19 infection on Jan. 20.

More work needs to be done in studies of banlangen and sales of the medicine are not expected to have a major impact on Baiyunshan’s performance, it said in a statement to the Shanghai stock exchange, where it’s listed. The company owns 50% of the joint venture.

Banlangen is a traditional Chinese medicine made from isatis root and often used as a common cure for cold and flu. In 2013 the product sold out in various parts of China during a fatal avian flu virus outbreak. Baiyunshan, which has a market value of around $7.8 billion, also retails Western pharmaceutical products.

©2020 Bloomberg L.P.

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