(Yicai Global) April 18 -- Yiling Pharmaceutical sank by the daily limit for the second trading day in a row after the son of Wang Jianlin, the billionaire chairman of Chinese conglomerate Dalian Wanda, questioned the efficacy of the drugmaker’s traditional Chinese medicine used in China for mild cases of Covid-19.

Yiling Pharma [SHE: 002603] closed 10 percent lower at CNY35.99 (USD5.65) today, after plunging by the same amount on April 15. The stock is still up 65 percent since the start of the year.

The two-day slump came after Wang Sicong, who is also a director at Wanda, reposted a now-deleted video on Weibo on April 14 questioning whether the World Health Organization had ever recommended Lianhua Qingwen as a Covid-19 treatment and saying that Chinese regulators should investigate Yiling Pharma. Wang has 40 million followers on Weibo.

Medical self-media account Dingxiang Doctor also posted an article yesterday with the title Don’t Take Lianhua Qingwen to Protect Yourself From Covid-19, which went viral on social media.

Yiling Pharma developed the treatment during the 2003 outbreak of severe acute respiratory syndrome, mainly to treat colds and influenza and it was approved by China’s National Medical Products Administration for use against Covid-19 in April 2020. The drug has been included in several versions of the Covid-19 diagnosis and treatment plans jointly issued by the NMPA and the National Health Commission as well as those issued by over 20 Chinese provinces and cities.

In the first nine months of last year, Lianhua Qingwen earned CNY3.4 billion (USD527 million) for Yiling Pharma, accounting for almost 42 percent of the Shijiazhuang-based firm’s total revenue.

The company never said on any occasion that the WHO recommends taking Lianhua Qingwen, China Entrepreneur reported on April 16, citing an official at Yiling Pharma. The WHO recognizes the efficacy of Covid-19 TCM, including Lianhua Qingwen, the person added.

Lianhua Qingwen inhibits the original strain of Covid-19 and its delta and omicron variants, as proven by basic and clinical studies carried out by research institutions in China, Yiling Pharma said on an investor platform on April 15.

Editor: Futura Costaglione