Shinpoong Pharmaceutical shares fell Friday morning as the Financial Services Commission (FSC) has launched an investigation into allegations that employees had traded shares using undisclosed information.

As of 9:06 a.m. local time, Shinpoong Pharm was trading at 15,230 won ($11.4), down 3.67 percent from the previous session.

The stock price saw a significant drop shortly after the market opened, falling to as low as 14,800 won and struggled to hit the 15,000 won mark.

According to sources on Friday, the FSC conducted an on-site investigation at Shinpoong Pharm’s headquarters in Gangnam-gu, Seoul, on Thursday.

The company’s stock price, which was around 6,000 won in February 2020, jumped to 214,000 won seven months later over the news that it was developing a coronavirus cure. But subsequently, due to negative announcements related to clinical trial results, the stock price dropped sharply.

The FSC is currently investigating whether company employees engaged in stock trading using undisclosed information during this period. The use of such undisclosed information in stock trading can result in fines up to 3 to 5 times the profit or loss avoided, in addition to a prison sentence of more than a year.

By Pulse

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