The firm — part of major conglomerate CK Hutchison, which was founded by retired billionaire Li Ka-shing — announced on Nov. 6 that its phase three clinical trial produced positive results. Trials showed a lower recurrence rate of 41% for patients on the drug, compared to a group being administered a placebo.
After the announcement on Wednesday, shares of the company climbed for two straight days.
It reached an intra-day high of HK$1.34 on Thursday, representing a 277% jump from HK$0.355 at last Tuesday's close. It has since pared some gains and was hovering around HK$0.96 on Tuesday afternoon.
CK Life's Chief Operating Officer Alan Yu pointed to the company's "fairly sustainable" model of having two cash-generating streams of business — healthcare and agriculture.
"Unlike other biotech companies, we have two streams of revenue to derive to support our R&D (research and development) programs," he told CNBC in a phone interview last week. "A lot of biotech companies live from hand-to-mouth, because they don't have cash-generating streams."
Responding to the strong market reaction, Yu said investors might be starting to appreciate the potential of the company's research projects.
"But people are beginning to take notice that these projects are starting to show some promise," he said, suggesting that the firm is undervalued.
Developed by its U.S.-based subsidiary Polynoma, the drug targets patients with early-stage melanoma — the deadliest form of skin cancer, and a group the company says is under-served. Most products in the market are currently for patients already progressed to the latter third and fourth stages, CK Life said.
The largest markets for the company's drug would be the United States and Europe, said Yu adding that a third of the world's skincare cancer patients are diagnosed in the U.S.
Looking ahead, CK Life will be betting big on health care, as populations in many advanced economies age rapidly, Yu said.
"Health care costs around the world are rising, and in some countries rising very rapidly," he said. "Definitely, health-related products present a significant opportunity, especially with aging populations."