Social-Media Scandal Costs Top Chinese Scientist Wu Yiling $2 Billion
Wu Yiling is one of China’s highest ranked scientists. With a fortune that neared $6 billion, he was also part of the world’s 500 richest people.
That was until last week, when the son of another Chinese billionaire sparked debate online with a post doubting the efficacy of Wu’s drug used to treat Covid-19. The herbal remedy, Lianhua Qingwen, is one of three traditional treatments the central government has recommended and was sent to households in Shanghai and Hong Kong during the latest omicron wave.
After a meteoric rise in Wu’s Shijiazhuang Yiling Pharmaceutical Co., the warning by Wang Sicong sent its shares tanking by the maximum 10% limit for two consecutive days. The slide then continued, taking the stock for its worst weekly plunge ever and down 35% from an April 11 peak. The wealth of Wu and his family has dropped $2 billion to below $4 billion, according to the Bloomberg Billionaires Index.
“Now Yiling is facing a test to restore its market recognition,” said Kenny Ng, a strategist at Everbright Securities International in Hong Kong. “In the short term, demand for Lianhua Qingwen should still be strong as the pandemic in mainland China is not yet eased, but in the long term, investors need to rethink whether its revenue can maintain decent growth as Covid subsides around the world.”
Debate over the efficacy of Traditional Chinese Medicine -- or TCM -- has intensified in recent weeks as the nation fights its worst outbreak since the early days of the pandemic. While the government has been promoting the remedies, they haven’t received the nod from regulators with global credibility, and the World Health Organization hasn’t approved or recommended the use of Lianhua Qingwen to treat Covid-19.
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