"Delisting" ShillaJen: "Major Clinical Trials Proceeding Normally... Will Actively Clarify" (Comprehensive)

[Asia Economy Reporter Lee Chun-hee] On the 18th, SillaJen announced its position in response to the Korea Exchange's Corporate Delisting Committee's decision to delist, stating that "management activities are operating normally" and expressing its intention to actively explain the situation.

In a statement posted on its official website that afternoon, SillaJen said, "We are currently conducting major clinical trials normally, and management activities such as research and development are operating normally," adding, "We apologize for causing concern to our shareholders."

The Exchange's Corporate Delisting Committee reviewed the case on the same day and decided to delist SillaJen. The final decision on delisting will be confirmed at the KOSDAQ Market Committee meeting held within 20 business days. SillaJen intends to actively explain its position at the Market Committee.

An official from the Exchange explained the reason for the delisting decision, saying, "The new drug pipeline has decreased, and since the largest shareholder changed to M2N, the only capital inflow was 100 billion KRW," adding, "It is unclear whether the corporate value can be maintained continuously." The official also stated, "A concrete plan to maintain the company as a going concern, including the pipeline, is necessary." In response, SillaJen is expected to actively inform the Market Committee that adding to the pipeline and increasing capital are sufficiently possible.

Furthermore, SillaJen plans to continue the ongoing clinical trials. Currently, SillaJen is conducting Phase 2 clinical trials for kidney cancer and Phase 1b and 2 clinical trials for melanoma with its immuno-oncology drug candidate, Pexa-Vec. Although the Phase 3 clinical trial for liver cancer in 2019 failed to prove therapeutic efficacy, the company has continued to pursue clinical trials for other cancers.

Previously, SillaJen's stock trading was suspended in May 2020 due to the occurrence of a reason for a substantial review of listing eligibility after former CEO Moon Eun-sang and other former executives were arrested and indicted on charges of embezzlement and breach of trust. Just before the trading suspension, SillaJen's market capitalization reached 866.6 billion KRW. Subsequently, the Exchange set a one-year improvement period until the end of November last year and received a report on the implementation of the improvement plan from the company on the 21st of last month before proceeding with the review. However, despite these efforts, the delisting decision could not be avoided.