Regencell Bioscience Holdings, a biotech company focused on herbal medicine, has gained over 400% on Monday and over 64,000% in the past year.
This growth in stock price is despite the company not having any revenue so far.
What does Regencell Bioscience Holdings do?
Hong Kong-based Regencell Bioscience debuted on the stock market in 2021.
According to the most recent annual filing with the Securities and Exchange Commission, the company is in its research and development stage and so far hasn’t made any revenue.
Regencell is incorporated in the Cayman Islands, and it aims to treat neurological diseases such as ADHD and autism spectrum disorder through traditional medicines made from herbs.
The company’s traditional Chinese medicine (TCM) formula that contains only natural ingredients and no synthetic components forms the basis of its products.
The company had also forayed into covid-19 treatment. In 2022, Regencell Bioscience conducted trials to treat covid-19 through a “holistic approach” with its experimental therapy.
The company said the treatment could reduce the symptoms of covid in six days, citing its trial data. However, the company’s trail data is yet to be verified through a peer review.
What caused Regencell’s stock surge?
Regencell’s stocks were a penny stock until recently. The company’s market capitalization jumped from $53 million in the previous year to $20 billion now.
In the fiscal year that ended in June 2024, Regencell had a net loss of $4.4 million, which decreased by 28% from the previous year.
At the time of writing, the biotech company’s shares jumped 270% on Monday to $59.12. The dramatic rise was caused by a 38:1 stock split the company had announced in the previous month.
The split came into effect on Monday, which sent the stock rising to historic highs.
Announced to enhance market liquidity and make shares more accessible, the split effectively increased the number of outstanding shares.
While a stock split doesn’t change the underlying value of the company, it lowers the per-share price, often making the stock appear more affordable to a wider range of retail investors.
In high-volatility, low-float stocks, such an event can create intense buying pressure, leading to exponential price appreciation as new buyers flock in.
The distribution of these additional shares and the commencement of split-adjusted trading on Monday, June 16, 2025, seem to have directly triggered a massive influx of demand, catapulting the stock to new highs.
Bloomberg reported that Regencell’s shares rallied by 434% in the session, making it its biggest one-day jump ever. The stock in the session also hit more than 10 volatility halts.
Another possible reason for the company’s strong stock movement is the smaller number of shares available for trading, Bloomberg said.
Out of Regencell’s total 500 million outstanding shares, only 30 million are available for trading, which is around 6% of the available shares.
In comparison, Apple’s 98% shares are available for trading, and for Tesla, the corresponding number is 87%.
The remaining company shares are owned by the insiders.
The company CEO, Yat-Gai Au, owns 86% of the company, according to data compiled by Bloomberg.
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