Drugmaker Medigen Biotechnology Co (基亞生技) yesterday said it would take legal action against Chinese-language Wealth magazine (財訊) for a report alleging Medigen’s development plan for its liver cancer drug PI-88 was a fraud.
Wealth magazine reported on Wednesday that Medigen deliberately downplayed a report issued on April 10 by the US’ National Institute of Health (NIH), which allegedly said that PI-88 was not effective, and delayed the announcement of the results of its clinical trials to create the illusion that PI-88 was still likely to pass interim analysis.
The magazine reported that while making investors hopeful, some Medigen shareholders were selling the company’s stocks before the results of the interim analysis were disclosed.
However, Medigen said the magazine report was erroneous.
Wealth magazine made a mistake by wrongly saying the report it cited was a report published by the NIH, when it was a thesis published by the Scandinavian Journal of Gastroenterology, Medigen chairman Stanley Chang (張世宗) yesterday said at a press conference.
The thesis said the effectivity of PI-88 is not yet proven, instead of claiming that the drug is ineffective, and it only used Medigen’s phase-two research data of the drug, Chang added.
Chen Pei-jer (陳培哲), an academic at Academia Sinica who is in charge of Medigen’s clinical trials, said the protocol of the trials was approved by the government before the trials started, and Medigen made regular reports to the government concerning the progress of the trials. As a result, it was impossible to manipulate the trials, he added.
The chairman also denied rumors that the company’s officials tried to drive up the share price by cooperating with illegal fund managers, and that the company was harassed by gangsters hired by these managers because they suffered great losses in buying Medigen’s shares.
Chang said none of the company’s board members face financial problems because they use Medigen shares to borrow money from banks, which is also contrary to the report.
“We dedicated ourselves to creating a new drug to treat liver cancer and our personnel are still doing the same thing now,” Medigen chief financial officer Bill Ou (歐朝銓) said yesterday by telephone. “However, after the interim analysis, Medigen seems to suddenly have become a different company for domestic media.”
Ou said some of the nation’s media outlets interpret the information they gather about Medigen in a most extreme way.
However, the company’s shares still declined by the maximum daily amount of 7 percent for the 14th day yesterday to close at NT$161, underperforming the over-the-counter bench-mark index, which was down 0.63 percent.
The company is unable to implement a share buyback scheme to stop its shares from falling because it had not swung back into the black yet, Ou said.