The Joint Response Team, tasked with eradicating stock manipulation, is conducting a raid on Bio Company A, a KOSDAQ-listed firm, for allegedly profiting from undisclosed information prior to a favorable announcement regarding a contract with a global pharmaceutical company.
According to financial sources, the team began its search early on September 15 at the headquarters of Company A in Gangnam, Seoul, as well as the residences of employees implicated in the case.
Company A specializes in developing immuno-oncology drugs and treatments for degenerative brain diseases. It announced last year that it had signed technology transfer agreements with a global pharmaceutical company for new drug development in both the first and second halves of the year.
Approximately 10 employees of Company A are suspected of acquiring shares before the announcement of the contract and then selling them for profit after the stock price increased following the public disclosure.
Current capital market laws prohibit insiders from using or allowing others to use undisclosed important information related to a listed company's operations for trading purposes.
The estimated amount of illicit gains is around 1 billion won.
The Joint Response Team is reportedly conducting a broad investigation into whether employees used undisclosed information personally, whether such information was shared organizationally within the company, and the involvement of executives and management.
If it is determined that the misuse of information was not an individual act but rather an organized effort within the company, or if executive involvement or violations of disclosure regulations are uncovered, it could lead to a substantial review of the company's eligibility for listing.
* This article has been translated by AI.
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