Authorities raid Korean stock exchange over Samsung BioLogics IPO
Nikkei reported the investigators’ actions and suggested that they were acting to determine whether Samsung BioLogics’ initial public offering (IPO) on the Korea Exchange had been carried out according to regulation.
The investigation is particularly concerned with whether the stock exchange had facilitated the contract development and manufacturing organisation (CDMO)'s listing in an improper manner.
This newest investigation follows the case, last year, which saw Samsung BioLogics face scrutiny from the South Korean financial regulator, respecting its actions to change its accounting treatment to swing from loss- to profit-making in 2016.
One of the stipulations for joining the Korean Exchange is that a company cannot suffer continued annual losses.
Based on its findings, the Securities and Futures Commission ruled that Samsung BioLogics had acted improperly, last year – fining the company KRW 8bn ($7.1m) and suggesting that it remove its CEO from the position. In addition, the company was temporarily delisted from the exchange.
To counter the regulator’s actions, Samsung BioLogics launched an administrative lawsuit to prevent these steps being carried forth. A South Korean court ruled in favour of Samsung BioLogics, overruling the commission’s actions and the company was relisted onto the stock exchange in December of last year.
After this latest setback, the stock price of Samsung BioLogics dropped from KRW 367 to KRW 338, before recovering to KRW 350, at the time of writing.
However, the regulatory headwinds the company faces has not prevented it from working to bring further biosimilars to market and to project plans to become a developer of novel biologics.