Probe launched into Hanmi Pharmaceutical

Shares of Hanmi Pharmaceutical continue to
plummet,… following allegations that it deliberately delayed an announcement on a
contract termination to give insiders an edge. A probe has been launched to see whether the
company told investors the negative news. Kim Min-ji has the details. Traders short-selling shares of Hanmi Pharmaceutical
are estimated to have made profits of over 20 percent. According to the Korea Exchange,… shares
of Hanmi Pharmaceutical fluctuated by as much as 23 percent on Friday,… meaning short-selling
traders could have made profits of roughly 135 U.S. dollars per share. Short selling refers to the sale of a security
not owned by the seller… or that the seller has borrowed. If the share price declines,… the security
can be bought back at a lower price for a profit. Hanmi Pharmaceutical has been under fire for
filing good and bad news that’s caused its share price to shoot up quickly and then plunge. After the markets closed on Thursday,… Hanmi
announced that it had signed a 910 million dollar contract with Genentech to license
an anticancer treatment,… with shares jumping 4 percent at Friday’s open. About half an hour later,… the company announced
the termination of its contract with Germany’s Boehringer Ingelheim — causing shares to
tumble more than 18 percent by the end of the day. Another question here is whether the company
informed some investors about the negative news to come…. giving them time to unload
their shares. In Korea,… listed firms are required to
make new announcements or corrections using a system run by the Financial Supervisory
Service. Korea Exchange officials then review the information
and approve disclosures. However, Hanmi Pharmaceutical didn’t tell
investors about the Boehringer Ingelheim deal and instead waited until the next morning. The company has apologized for the delay,…
saying it put the announcement off so that it wouldn’t cause confusion with regard to
the disclosure about the Genentech deal. The Financial Service Commission and Korea
Exchange launched a joint probe into Hanmi Pharmaceutical on Sunday… to see whether
it violated the rules for fair disclosure or not. Hanmi shares were trading down roughly seven
percent on Tuesday morning. Kim Min-ji, Arirang News.

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