China drug stock price surges after Doctor endorses treatment for Covid
A maker of traditional Chinese medicine products saw its stock surge the most in two years Friday after one of the nation’s top medical advisers reportedly said one of its treatments could potentially inhibit Covid-19.
Speculative traders pushed Guangzhou Baiyunshan Pharmaceutical Holdings Co up 14 per cent in Hong Kong and by its 10 per cent limit in Shanghai. Guangzhou-based Nanfang Daily cited Zhong Nanshan as saying Baiyunshan’s banlangen product was effective in a series of in-vitro studies. Zhong is a senior medical adviser to Beijing who confirmed the risk of human-to-human Covid-19 infection on January 20.
Zhong was speaking at a October 13 ceremony in Guangzhou to launch a Baiyunshan banlangen project. Zhong will lead a team working on development and upgrades of the drug, according to the paper. Zhong’s team had worked with Baiyunshan in research on the products properties after the SARS outbreak, it added.
Banlangen is a traditional Chinese medicine made from isatis root and often used as a common cure for cold and flu. In 2013 the product sold out in various parts of China during a fatal avian flu virus outbreak. Baiyunshan, which has a market value of around $7.7 billion, also retails Western pharmaceutical products. Its Hong Kong shares are down 19 per cent this year.
Tests cited in the report are still early stage and it remains unclear whether the medicine is effective beyond a test tube.
Traders sent the stocks trading volume in Hong Kong to 21 times above its 30-day average. CSPC Pharmaceutical Group Ltd. which also makes a version of banlangen, dropped as much as 5.3 per cent in Hong Kong.