Medigen Biotechnology Corp (基亞生技) shares continued to lose value, recording a 19th day of falling to the maximum daily limit of 7 percent yesterday, after investor sentiment weakened over the failure of its new drug for liver cancer to pass clinical trials, dealers said.
The Medigen share sell-off also spread to other biotech stocks and even to small and medium-sized non-biotech stocks in the over-the-counter (OTC) market, the dealers said.
Shares of Medigen fell to NT$113 at the close with 143,000 shares changing hands. The index on the OTC market, where the stock is traded, ended down 0.41 percent at 134.53 points.
The stock opened down 7 percent and selling continued without any sign of fading, keeping the share price weak throughout the session, dealers said.
Even after the market closed, investors placed orders to sell 7.8 million more Medigen shares, indicating that the stock could trend even lower, perhaps even dropping as low as NT$100 over the next few sessions.
On July 27, Medigen’s new liver cancer drug — PI-88 — failed to pass interim analysis in clinical trials. Starting from the July 28 trading session, Medigen shares started to decline steeply, registering a loss of about 74 percent.
After the plunge in share prices, the market capitalization of the company fell by NT$45 billion.
Due to the price volatility, Medigen shares have been downgraded to a “full-delivery stock” that cannot be traded on the margins by investors, further reducing investor interest, traders said.
Medigen said the clinical trials are continuing and still require final analysis, and it is therefore too early to say that the development of the new drug has failed.
The sell-off in Medigen shares led many investors to sell other stocks in both the biotech and non-biotech sectors throughout the session, the dealers said.
Among the affected stocks were LED product supplier Yang Hwa Technology Corp and electronics component maker Podak Co.
Both fell by the maximum 7 percent to close at NT$62.50 and NT$36.45, respectively.
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