[Special Stock] Shinpung Pharmaceutical Drops Over 9% Following Former CEO's Prosecutor Complaint News

On the 17th, Shinpung Pharmaceutical's stock price plunged by over 9%. The news that former CEO Jang Won-jun was reported to the prosecution for avoiding losses by using undisclosed internal information appears to have acted as a negative factor.

As of 2:06 PM on the same day, Shinpung Pharmaceutical's stock was trading at 9,300 KRW, down 9.27% compared to the previous trading day.

On this day, the Securities and Futures Commission under the Financial Services Commission announced that at the regular meeting on the 12th, it resolved to report former CEO Jang and Shinpung Pharmaceutical's holding company Songamsa to the prosecution for violating the Capital Markets Act's prohibition on the use of undisclosed important information.

According to the Securities and Futures Commission, former CEO Jang, the actual owner of Shinpung Pharmaceutical and second-generation founder, sold a large volume of Shinpung Pharmaceutical shares held by himself and Songamsa through an off-hours block deal before disclosing to investors the failed results of the COVID-19 treatment clinical trial, thereby avoiding losses amounting to 36.9 billion KRW.

The Securities and Futures Commission explained, "This is a case where the actual owner of a KOSPI-listed company, who should set an example for capital market participants, instead took unfair profits by using undisclosed internal information not available to the public," adding, "Given the seriousness of the matter, we judged it necessary to take action by reporting to investigative authorities."

Shinpung Pharmaceutical maintains the position that former CEO Jang was not aware of the clinical trial information related to the COVID-19 treatment at the time of the share sale.