Shares of Hanmi Pharmaceutical plunged 10.76 percent to close at 311,000 won ($266.30) Wednesday, following news its partner Janssen had stopped recruiting participants for the clinical trials of a new diabetes drug licensed out by the South Korean drugmaker last year.

The news came just months after Boehringer Ingelheim terminated a $730 million licensing deal it had entered with Hanmi over a new lung cancer therapy back in July 2015 after patient safety issues emerged, igniting fresh fears among Hanmi shareholders.

According to the US National Institutes of Health’s Clinical Trials Register, Janssen Pharmaceuticals — a subsidiary of Johnson & Johnson -- has “suspended participant recruitment” for phase 1 clinical trials of JNJ- 64565111. 

JNJ-64565111, also known as HM12525A, is a biologic drug for the treatment of diabetes, originally developed by Hanmi. It was licensed out by Hanmi to Janssen in November 2015 in a deal valued at $915 million.

Under the licensing partnership, Hanmi Pharmaceutical had received an upfront payment of 105 million won and would receive additional payments based on the drug’s development milestones and commercialization.

Janssen had begun phase 1 clinical trials of JNJ-64565111 in the US from July, testing the drug’s efficacy on adult patients with Type 2 diabetes mellitus. The study’s estimated completion date was April 2017.

Hanmi Pharmaceutical released a statement on Wednesday saying that Janssen has temporarily stopped recruiting new patients to partake in clinical trials, and that the move does not signify that the clinical trials have been permanently halted.

“Such ‘participant recruitment suspensions’ are common when companies are carrying out clinical trials of new drugs. This status means that the clinical trials can be continued any time,” the Korean drugmaker said.

“There are no changes to our partnership with Janssen as well,” it added, addressing market fears that Janssen could also terminate its partnership with Hanmi, as Boehringer Ingelheim did in September.

Janssen Pharmaceuticals has yet to publicly clarify its reasons for suspending patient recruitment for the phase 1 clinical trials of JNJ-064565111.

Despite reoccurring issues surrounding Hanmi’s novel drug candidates licensed out to global pharmaceutical companies, the Korean drugmaker is continuing to push forward new drug development for other illnesses.

Earlier this week, Hanmi Pharmaceutical and Ajou University entered a new drug development partnership for the development of a novel stem cell therapy targeting brain cancer.

Under the partnership, Hanmi, Ajou University’s School of Medicine as well as the Cha Bundang Medical Center will conduct preclinical trials on a new anti-cancer drug candidate developed by the university.

The drug candidate was developed by combining mesenchymal stem cells from bone marrow with cytosine deaminase, an enzyme encoded in genes. It targets glioblastoma, the most common and aggressive form of brain cancer led by a fast-growing tumor in the central nervous system.

Hanmi plans to initiate the drug’s phase 1 clinical trials in Korea for its therapeutic effects on glioblastoma next year, with plans to hold additional studies on the drug’s efficacy for other cancer and brain tumor categories. 

By Sohn Ji-young (jys@heraldcorp.com)