Jointstem Rejection: What Happened?
NatureCell’s osteoarthritis treatment, Jointstem, has been rejected due to a lack of clinical significance. This puts the future of the domestic sales rights agreement signed in 2013 in jeopardy.
Reasons for Rejection and Its Impact
The regulatory authorities deemed Jointstem’s clinical efficacy insufficient, meaning the treatment’s effectiveness wasn’t clearly demonstrated. This deals a critical blow to NatureCell’s stem cell business, as Jointstem was its core pipeline project.
NatureCell’s Current Situation: A Deteriorating Fundamental
This rejection adds to NatureCell’s already negative financial outlook. As of Q1 2025, revenue decreased by 55% year-on-year, with both operating and net income turning negative. Not only the stem cell business but also the food business is struggling.
- Significant Revenue Decline: 55% decrease year-on-year, totaling 40.77 billion KRW
- Operating Loss: 17.06 billion KRW loss
- Net Loss: 12.40 billion KRW loss
In this situation, the Jointstem rejection is expected to further worsen the company’s financial situation and hinder future funding efforts.
What Should Investors Do?
The rejection of Jointstem is expected to have a highly negative impact on NatureCell. Investors should be wary of potential short-term stock price drops and carefully examine the company’s future business plans and potential for financial restructuring. Hasty investment decisions could lead to significant losses.
Frequently Asked Questions
Why was Jointstem’s approval rejected?
It was rejected due to insufficient clinical significance, meaning the treatment’s effectiveness wasn’t adequately proven.
What is the impact of this rejection on NatureCell?
The loss of its core pipeline project in the stem cell business is expected to have a highly negative impact, including decreased revenue, worsening financial conditions, and negative investor sentiment.
How should investors react?
Investors should be cautious of potential short-term stock price declines and carefully consider the company’s future business plans and possibilities for financial restructuring.