The news that Jang Won-jun, the second-generation owner and former representative, has been reported to the prosecution has led to a decline in Shin Poong Pharm's stock price.

Jang Won-jun, the second-generation owner of SHINPOONG, and former CEO of Shin Poong Pharm, appears at the warrant review held at the Seoul Central District Court in Seocho-gu, Seoul, on Jan. 27, 2023. At that time, he faced allegations of creating slush funds through false transactions with a pharmaceutical raw material supplier. /Courtesy of News1

According to the Korea Exchange on the 17th, at 2:36 p.m., Shin Poong Pharm is trading at 9,520 won, down 730 won (7.12%) from the previous trading day. During the day, it fell to 9,090 won, recording its lowest price in a year.

This is interpreted as a decision by the financial authorities to report Jang and Song Am, the holding company of Shin Poong Pharm, to the prosecution. The Securities and Futures Commission, under the Financial Services Commission, held a regular meeting on the 12th and decided to report them for violating the Capital Markets Act by using undisclosed important information.

According to the Securities and Futures Commission, Jang, the actual owner and second-generation founder of Shin Poong Pharm, used internal information related to clinical results of new drug development to avoid losses amounting to 36.9 billion won.

In April 2021, Jang sold a large quantity of Shin Poong Pharm stocks owned by Song Am, which was managed by him and his family, through off-hours block trading. At that time, the COVID-19 treatment that Shin Poong Pharm was conducting clinical trials for did not meet the efficacy goals for the primary evaluation index in phase two, and the Securities and Futures Commission believes that Jang sold the stocks to avoid losses, knowing about this adverse news in advance.