Chinese Pharma Stocks Pummeled Amid Scare of HIV Contamination in Medical Products
The drug watchdog said a day after the investigation launched that the medical products in question were clear from infection, but the stocks of pharma companies took a hit nevertheless.
(Updated with today's closing prices)
The stocks of U.S.-listed Chinese pharma companies tumbled Thursday amid a continuing scare related to reportedly HIV-contaminated blood plasma products distributed to hospitals across China by state-backed Shanghai Xinxing Medicine Co. Ltd.
Shares in oncology-focused Beigene Ltd. (Nasdaq: BGNE) closed down 3.5 percent, at $126.06 apiece in New York. China Biologic Products Holdings Inc. (Nasdaq: CBPO), which develops plasma-based biopharmaceutical products, traded down nearly 2 percent down, to $78.12 per American depositary share.
Pharma products distributor 111 Inc. (Nasdaq: YI), which had been among the biggest losers in the industry as its stock slid 7 percent slide during the day, closed at $8.54 per share, a loss of 3.5 percent.
The stock of Zai Lab Ltd. (Nasdaq: ZLAB), which experienced volatility throughout the day, declined 3 percent, at $30.60 per ADS. The company enjoyed a boost earlier today from an "outperform" rating by Credit Suisse Group, which assumed coverage of the drug developer specializing in oncology and infectious diseases at $34.70 per share, representing an upside of 10 percent from yesterday's close.
Shares in China Pharma Holdings Inc. (NYSE American: CPHI), which makes drugs for conditions with high mortality rates, inched 1 cent lower, or 4 percent, to 29 cents apiece. China SXT Pharmaceuticals Inc. (Nasdaq: SXTC), which makes Chinese traditional herbal medicine products, did not escape the fate of its big brothers and slid more than 4 percent to $5.88 per share.
Pharma stocks suffered after China launched an investigation into the sales of 12,000 units of intravenous immunoglobin made by Shanghai Xinxing. On Tuesday, China's National Health Commission received a report from a disease control center in Jiangxi province claiming the products tested positive for HIV antibodies, according to Caixin Global. It then warned medical institutions across the country to suspend use of the treatment.
However, inspectors from the National Medical Products Administration (NMPA) said the next day that they had tested the products and found no trace of contamination by HIV, as well as hepatitis B and C, as reported by the South China Morning Post. This conclusion was issued by the same drug watchdog whose officials are under investigation over last year's rabies vaccine scandal.
The production and sales of the products at Shanghai Xinxing have been halted and are under inspection, as reported by various media. There have been no disclosed cases of patients having contracted HIV in this incident, as reported by the SCMP.