SHANGHAI — Chinese vaccine maker Changsheng Biotechnology plunged by its daily limit of 10 percent in early Tuesday trade, after police launched a probe into illegal behavior by the firm and China’s President Xi Jinping called for swift action.
China’s drug regulator has accused Changsheng of fabricating production and inspection records related to a rabies vaccine regularly given to infants, sparking public outrage.
While there have been no known reports of people being harmed by the vaccine, Chinese regulators ordered Changsheng to halt production and recall the product.
Changsheng apologized in a regulatory filing on Monday. The firm was also found to have sold 252,600 substandard DPT vaccines, a mandatory vaccine in China to inoculate children against diphtheria, whooping cough and tetanus.
Changsheng is now being investigated by multiple authorities in China, including the securities regulator and the country’s top graft watchdog. The Central Commission for Discipline Inspection (CCDI) said on Tuesday it had begun an investigation into possible corruption at the firm.
The scandal, which dragged down healthcare stocks across the board on Monday, has now wiped around $1.8 billion from Changsheng’s Shenzhen-listed shares since mid-July, over half their value.
Chinese citizens have been quick to express their fury online with one discussion hashtag on the Sina Weibo microblog gathering over 600 million views. The state-run Global Times newspaper said in an editorial late on Monday the case had created a “tsunami” on the internet.
The scandal has prompted speculation that mainland Chinese would take their children outside mainland China for vaccines as has happened during previous scandals, which could lead to a shortage in Chinese-controlled regions like Hong Kong or Macau.
The Hong Kong Department of Health told Reuters local supply of the vaccines remained stable and it would closely monitor the situation. Macau’s health bureau said current supply was sufficient for residents and there was no need for concern.