SFC orders biotech firm Cloudbreak Pharma to suspend trading over suspected IPO rigging

The Securities and Futures Commission has directed the stock exchange of Hong Kong to suspend all dealing in the shares of Cloudbreak Pharma (2592) over suspected IPO rigging, effective at 9:00 am on Thursday.

Under Section 8(1) of the Securities and Futures (Stock Market Listing) Rules, the regulator said it has serious concerns that Cloudbreak’s initial public offering may have been rigged to create an artificial impression of demand for Cloudbreak’s shares, according to the statement published on Thursday.

It added that it considers that the suspension is necessary or expedient to maintain an orderly and fair market in the shares of Cloudbreak Pharma and to protect the interests of the investing public while the SFC’s investigation continues.

Cloudbreak Pharma is a clinical-stage ophthalmic drug developer with proprietary technology. 

This US-based biotech firm debuted on the Hong Kong stock exchange in July last year, raising a total of HK$522 million. 

Before its trading suspension on Thursday, the company's share price was HK$1.19, marking an 88 percent drop from its listing price of HK$10.1 last year. 

The company reported a net loss of US$47.95 million(HK$374 million) for the first half of the year, compared with a net profit of US$5.19 million during the same period last year.

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