May 9 (UPI) -- A South Korean biotech company is likely to benefit greatly from the policy of the U.S. Food and Drug Administration, which is scheduled to retire animal testing.
Organoid Science debuted on the Seoul bourse Friday, with its share price surging by 52.38% on Day 1. The firm focuses on lab-grown miniature organs, which can be used for clinical tests.
In South Korea, share value is not permitted to rise more than 30% a day, except for newly listed stocks, which may rise up to three times that limit on the first day.
Observers point out that the strong stock price of Organoid Science was driven by the FDA, which plans to replace animal testing with more effective and human-relevant methods in developing monoclonal antibody therapies and other drugs.
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"For too long, drug manufacturers have performed additional animal testing of drugs that have data in broad human use internationally," FDA Commissioner Martin A. Makary said in a statement last month.
"This initiative marks a paradigm shift in drug evaluation and holds promise to accelerate cures and meaningful treatments for Americans while reducing animal use," he said.
Organoid Science has developed an organoid-based testing platform, dubbed ODISEI, which is designed to imitate human physiology without having to depend on animal models.
The company claims that alternative platforms could phase out animal testing once and for all.
Against this backdrop, the market capitalization of Organoid Science is expected to keep rising in the near term.
"Organoid Science was projected to perform well in the stock market as its initial public offering was heavily overbooked," Seoul-based consultancy Leaders Index CEO Park Ju-gun said in a phone interview.
"Thanks to the FDA's policy and the global trend, the company is expected to perform well in the stock market in the near future," he added.
Its IPO oversubscription ratio was more than 1,000 times for institutional investors, while the figure was over 850 times for retail investors.
NH Investment & Securities analyst Han Seung-yeon also told UPI that the FDA policy on animal testing has generated strong interest from investors in alternative technologies.
