Kolon TissueGene Shares Plunge for Third Day Following Disappointing U.S. Trial Results

Kolon TissueGene has seen its shares drop for three consecutive days following disappointing results from a U.S. Phase 3 clinical trial.

As of 9:24 a.m. on July 23, Kolon TissueGene's stock was trading at 21,050 won, down 29.95% from the previous trading day. The shares had previously fallen 29.90% and 29.95% on July 21 and 22, respectively, hitting the daily trading limit each day.

The sharp decline in stock price is attributed to the top-line results of the Phase 3 clinical trial for the osteoarthritis gene therapy 'TG-C' (formerly Invossa). Kolon TissueGene announced that it failed to demonstrate statistical significance compared to a placebo in the primary endpoints of the Visual Analog Scale (VAS) for pain and the Western Ontario and McMaster Universities Osteoarthritis Index (WOMAC).

Initially, Kolon TissueGene planned to submit a Biologics License Application (BLA) in the first quarter of 2027 based on the results of two Phase 3 trials in the U.S. However, this latest outcome has made delays unavoidable. The market is concerned that the timeline for U.S. Food and Drug Administration (FDA) approval may be pushed back as a result of these findings, leading to increased selling pressure on the stock. Nevertheless, the company stated that the efficacy of TG-C has been consistently confirmed in previous trials, attributing the recent results to an unusually large placebo effect. Kolon TissueGene plans to continue its approval strategy with the FDA based on the results of a second Phase 3 trial expected to be announced in October.