AprilBio's stock swung between "hell" and "heaven" in a day. Investor sentiment froze after news the previous day of large stock sales by executives sent the shares down 10%, but a reversal came overnight. With positive clinical results for a key pipeline that had been transferred disclosed, the stock hit the upper price limit on the 11th.
On the 11th on the KOSDAQ market, AprilBio surged to the daily limit at the open, trading at 69,200 won. After plunging more than 10% the previous day on news of sizable insider sales of treasury shares, the stock went straight to its upper limit in a day, shaking off the bad news completely.
The previous day, AprilBio's share price fell more than 10%. The impact of news that executives sold their holdings was significant. According to the Financial Supervisory Service's electronic disclosure system, a filing posted the previous day said three executives sold shares on the market on the 3rd. Two of the three non-registered executives sold all their holdings, and one sold 45,500 shares, for a total of 81,000 shares hitting the market.
All the shares they sold were acquired by exercising employee stock options on the 12th of last month. The exercise prices were in the 3,000 won to 10,000 won range. It is estimated that the capital gains they pocketed from this sale alone amount to about 4.2 billion won.
Although the shares sold on the market accounted for only 0.35%, AprilBio's stock fell sharply. In particular, as AprilBio's main pipeline was about to release clinical results, suspicions arose that company insiders might have sold with advance knowledge.
The situation flipped overnight. Overnight, AprilBio's U.S. partner, Evommune, released that phase 2a for atopic dermatitis with "APB-R3" succeeded. Evommune said that administering APB-R3 led to a statistically significant reduction in EASI (Eczema Area and Severity Index) versus placebo. APB-R3 is therefore set to enter phase 2b with a subcutaneous (SC) formulation.
The stock also jumped immediately. After moving sideways this year between the 40,000-won and 64,000-won ranges, the shares hit the upper price limit early in the session.
Wi Hae-joo, a researcher at Korea Investment & Securities Co., said, "The R3 clinical success owed much to AprilBio's SAFA platform," and noted, "We expect announcements of next-generation drug candidates with SAFA binding that AprilBio released, and an acceleration of REMAP platform transfer."
The executives' out-of-step move to dump shares right before a positive catalyst ended up proving their innocence. An AprilBio official said, "The company did not know the clinical results or the timing of the release," adding, "In fact, we expected the clinical results to be announced in March, so we thought selling now could reduce misunderstandings, which is one reason we sold the shares."