Some Arrested in Japan over False COVID-19 Drug Info

Society

Tokyo, Feb. 25 (Jiji Press)--Tokyo police arrested Friday some people for releasing false information about Japanese biotechnology startup Tella Inc. <2191> to drive up its stock price regarding a plan to develop a treatment for the novel coronavirus, investigative sources said.

Those arrested by the Metropolitan Police Department include Kaoru Takemori, former president of Cenegenics Japan, a medical equipment maker now under bankruptcy procedures. They are suspected of violating the financial instruments and exchange act. Cenegenics and Tella, both based in Tokyo, were in a business partnership.

The suspects allegedly released to investors in October 2020 false information regarding Tella's announcement of a plan to raise about 3.5 billion yen in fresh funds from Cenegenics through a new share issue, in an attempt to jack up the stock price of Tella, listed on the Jasdaq market of the Tokyo Stock Exchange, the sources said.

Tella announced in April 2020 a plan to develop a COVID-19 treatment, which led its stock price to soar from levels below 200 yen to above 2,000 yen in June the same year. But the price later started falling.

In March 2021, the MPD and the Securities and Exchange Surveillance Commission conducted on-site inspections of Tella's headquarters and other related locations for suspected violations of the financial instruments law.

[Copyright The Jiji Press, Ltd.]

Jiji Press