## From Taiwan Stock Market Rising Star to Limit-Down Dilemma: The Triple Risks Behind Kang Pei Biotech's Sharp Decline

Kang Pei Biotech has recently experienced a significant drop in stock price. As a biotech company included in Taiwan's Top 50 Index, it faces a crisis of market confidence. The core issue stems from uncertainties in the Phase III clinical trial of its flagship product CBL-514, prompting investors to deeply reconsider the reasons behind the biotech stock's plunge.

**FDA Feedback Triggers Chain Reaction**

The pivotal turning point at the September earnings call was the U.S. FDA's suggestions for optimizing the CBL-514 clinical trial. While the FDA did not question the safety or efficacy of the trial, it requested additional validation studies for the Abdominal Fat Rating Scale (AFRS), leading to a delay of approximately six months in patient enrollment. Although this technical requirement appears to be a "quality improvement," it has caused a seismic reaction in the capital markets.

The stock price entered a free fall: on September 10, it hit the limit-down at 229.5 NT dollars at market open, and again on September 11, it hit the limit-down at 207 NT dollars. **The consecutive two-day limit-down caused a market cap evaporation of 40 billion NT dollars, with the total number of sell orders at the limit exceeding 30,000 shares,** fully reflecting market pessimism over the delay in progress.

**Insider Selling Signals Cannot Be Ignored**

More concerning is the internal activity within the company. According to publicly available data, **Kang Pei Biotech insiders have been continuously reducing their holdings for three months in a row: in June, they sold 137 shares (pre-spin-off), in July, 117 shares, and in August, four managers sold a total of 324 shares.** This accelerated selling pattern had already begun before the trial uncertainties were publicly disclosed, indicating that informed insiders were reacting to risks in advance.

Although the company issued a clarification emphasizing that the delay in patient enrollment was a proactive measure to improve registration success rates, investors generally interpret insider selling as a "negative" signal.

**Reasons for the Biotech Stock Decline: Reassessing Commercialization Timelines**

From the perspective of drug approval, the delay in patient enrollment significantly pushes back the product launch schedule. **Under the most optimistic scenario, CBL-514 would not obtain U.S. approval until 2029, and the Asian market would require independent Phase III trials.** This extension in timeline poses substantial pressure on a biotech company with a market value already exceeding 10 billion USD.

CEO Ling Yu-Fang stated that the company is negotiating licensing agreements with the top ten global pharmaceutical companies to explore new pathways for commercialization, but the uncertainty surrounding international licensing progress remains difficult to eliminate.

**Market Focus and Investor Attention**

Market attention has shifted to three key areas: whether Kang Pei can successfully complete the AFRS optimization, progress in international licensing negotiations, and interim data analysis results. Before these milestones are confirmed, the reasons behind the biotech stock's decline—namely, product development risks and reassessment of commercialization timelines—will continue to dominate market sentiment. South China Securities Investment Advisory pointed out that although CBL-514, as a novel mechanism partial fat reduction drug, has attractive prospects, recent volatility highlights the importance for new drug R&D companies to improve communication with regulators and manage progress effectively.