UPDATE 2-Celltrion denies insider trading as shares tumble
* Celltrion denies allegations of suspicious share trade
* Shares fall amid lingering concerns about management
* Regulators decline to comment about any investigation (Recasts with Celltrion comments denying wrongdoing)
By Miyoung Kim
SEOUL, Sept 16 (Reuters) - South Korean bio-pharmaceutical firm Celltrion Inc on Monday denied allegations of insider trading that sent its share price tumbling and cast a shadow over its plans to sell a $1.3 billion stake, while confirming it had met with regulators.
The denial comes as concerns about management practices at the firm complicate its efforts to secure a buyer among multinational drug makers for chief executive Seo Jung-jin's controlling interest.
The company, at $4.4 billion the largest on South Korea's junior bourse, said that in a meeting with regulators on Friday it had rejected allegations that it had supplied certain investors with inside information.
"At Friday's meeting, we made it clear ... that the company has not been engaged in any activity of leaking undisclosed material information and helping certain investors take profits unfairly," Celltrion said in a statement.
"We have not been informed of any decision from the meeting and regret that it's been reported in the media before final decision is being made."
Korean media including Yonhap news agency and broadcaster SBS CNBC reported that the allegations concerned Seo, who founded the firm in 2002 and is trying to sell his stake worth about $1.3 billion.
Seo could not be reached for comment. An official at the Financial Supervisory Service said the regulator did not disclose details of individual cases.
Shares in Celltrion closed down 5.4 percent in heavy trade, paring earlier losses of as much as 14.8 percent which took the stock to its lowest level since late June.
Celltrion has been dogged by suspicions of misconduct ranging from accounting fraud to clinical trial failures. It has strongly denied the allegations and has not been previously investigated for any wrongdoing.
On the contrary, the company has requested financial authorities investigate short sellers it accuses of trying to manipulate its stock price.
Celltrion makes biosimilars, which are less expensive versions of complex biological drugs used to treat diseases such as cancer. It counts Singapore sovereign wealth fund Temasek Holdings among its investors.
British firm AstraZeneca Plc is seen as a possible buyer of Seo's stake. Chief executive Pascal Soriot said last month the firm was looking at ways to leverage its capacity to make biotech drugs within its MedImmune unit, including a possible move into so-called biosimilars.
But he declined to comment on whether the firm might be interested in acquiring a biosimilars business such as Celltrion, which got European backing for its copycat version of the blockbuster rheumatoid arthritis drug Remicade in June.
The sale would open a door for pharmaceutical firms to expand into the growing market for biosimilar drugs. But banking industry sources have said would-be bidders are being deterred by concerns about management and share price volatility.
($1 = 1087.0250 Korean won) (Additional reporting by Hyunjoo Jin; Editing by Stephen Coates)