Cutting the cord?: Events leading up to and after Cordlife’s MOH suspension and arrests of its directors, ex-group CEO

AMID ongoing investigations into its processes and a shareholder dispute, troubled private cord-blood bank Cordlife Group was thrust back into the spotlight after the arrests of four directors and its former group chief executive officer on Mar 22, 2024.

The Business Times traces the timeline of events leading to these arrests, which are related to alleged breaches-of-disclosure obligations. These disclosures relate to irregular temperatures in its storage tanks, which led to a six-month suspension notice from the Ministry of Health (MOH) in November 2023.

November 2020 to November 2023: Movements in the dark – lapses in Cordlife’s storage units, but the public is not informed

November 2020 to Nov 30, 2023: Cordlife’s cryopreserved cord-blood units in seven of 22 storage tanks are exposed to temperatures above acceptable limits at different periods.

February, March and June 2022: At least one tank (Tank A) containing 2,200 cord-blood units is exposed to temperatures beyond acceptable limits for several days in these months.

June 2022: “Certain members” of Cordlife’s management team are alerted by an employee about that tank’s exposure to irregular temperatures for several days in June 2022. Upon being notified, they take immediate action and carry out internal investigations; processes are later “strengthened”. 

September 2022: Cordlife is inspected by MOH as part of a biennial routine inspection. The ministry does not find any lapses relating to storage tank temperatures, and Cordlife does not disclose any incidents to MOH.

February 2023: Cordlife’s board is informed of the June 2022 incident. The board assesses the incident, and says there would be “no material impact” on the financial performance of the group for FY2022 and FY2023. External auditors are also informed. 

Jun 26, 2023: Shares of Cordlife hit a three-year high amid heavy trading, after the company says it is aware of a possible transaction between Cradle Investments and a third party, which may lead to an offer for its shares. The counter closes up 20.5 per cent at S$0.50. 

Jul 24, 2023: MOH receives a complaint from a member of the public alleging that cord-blood units stored in one of Cordlife’s tanks had been exposed to temperatures above 0 degree Celsius.

Aug 15, 2023: MOH conducts an unannounced audit on Cordlife. Cordlife finds out about the irregular temperature exposure in Tank A and also about another tank in February and March 2022. 

Aug to Nov 2023: MOH inspectors call Cordlife on multiple occasions to request and clarify documents, as well as to seek further explanation.

Sep 13, 2023: Cordlife says the possible transaction announced in June in relation to its shares is not on the table any more.

Oct 27, 2023: Group CEO and executive director Tan Poh Lan resigns to pursue “personal interests”. Her last day is stated as Mar 31, 2024. 

Nov 16 to 21, 2023: MOH conducts further unannounced audits on Cordlife.

November 2023 to January 2024: Lapses come to light, regulatory investigations begin

Nov 30, 2023: MOH slaps Cordlife with a six-month suspension. It is barred from collecting, testing, processing and/or storing new cord blood and human tissues. The company is also barred from providing any new types of tests to patients. The suspension is to start two weeks from Nov 30.

MOH says seven of the 22 tanks at Cordlife were exposed to temperatures above acceptable limits at different periods from November 2020. Samples from Tank A are tested by Cordlife, and an independent expert panel concludes its cord-blood units have been damaged.

Dec 1, 2023: Cordlife shares drop as much as 42.9 per cent in early trading to near the lowest level since its listing in 2012. It closes down 32 per cent, or S$0.145, at S$0.31.

Cordlife begins sending e-mails to customers on the storage lapses. In an e-mail seen by BT, the company commits to finding a replacement for customers whose stored cord blood has been deemed unsuitable for use in required treatment.

Dec 5, 2023: Cordlife updates shareholders that its accreditation by the Foundation for the Accreditation of Cellular Therapy has been suspended with immediate effect, at least until the foundation’s investigations are completed and issues are resolved.

Dec 7, 2023: Cordlife informs shareholders that the suspension of accreditation from the Foundation for the Accreditation of Cellular Therapy will not impact its storage of cord blood.

It also says the Association for the Advancement of Blood & Biotherapies is conducting an internal investigation into Cordlife on the issues uncovered by MOH. Under this probe, the association is continuing to collect relevant information that will inform it on the next steps regarding the accreditation status of Cordlife’s facility.

Dec 8, 2023: In a Facebook post, Minister for Health Ong Ye Kung says investigations into Cordlife could take another six weeks. The ministry supervises Cordlife’s banking activities and inventory in the interim. Ong advises parents to hold off on transferring their cord-blood units until investigations are completed. 

Dec 10, 2023: Cordlife responds to queries from Singapore Exchange Regulation about the lack of announcements about the temperature breaches and process lapses.

Dec 13, 2023: Cordlife accepts MOH’s notice and says it will not be making written representations. 

Dec 15, 2023: Cordlife’s six-month suspension begins.

Jan 10, 2024: In response to questions in Parliament, Senior Minister of State for Health Janil Puthucheary says MOH will review the regulatory requirements for cord-blood banking providers. The regulatory requirements to be reviewed include the frequency of inspections and other aspects of inspections, as well as monitoring and reporting requisites.

Jan 15, 2024: A report prepared by Cordlife in response to private queries from Singapore Exchange Regulation finds that the temperature at one storage tank reached as high as 20.4 deg C in 2021. 

Jan 17, 2024: Cordlife says it will send cord-blood samples from all seven affected tanks to a third-party laboratory by Jan 18. The company says each sample batch may take three to six weeks to be completed, depending on whether a repeat test of samples from the same tank is needed.

Jan 23, 2024: MOH says it has found three more lapses at Cordlife, regarding cord-blood processing methods, the temperature monitoring system and preventive maintenance. Cordlife will be required to rectify these “potential non-compliances” by end-May.

Meanwhile, Robust Plan and its beneficial owner Shanghai Dunheng Capital Management ceases to be a substantial shareholder of Cordlife after selling 4.6 million shares for S$1.5 million.

Jan 26, 2024: MOH estimates that the results of the tests on the samples will be available by end-March.

February to April 2024: Leadership changes and arrests

Feb 5, 2024: Around this time, Cordlife begins offering refunds to affected customers whose cord-blood units were damaged.

Feb 19, 2024: Cordlife announces that Yiu Pang Fai (Ivan Yiu), a former TransGlobal unit executive director, will take over as group CEO. Former group chief Tan’s last day at the company is brought forward to Feb 19.

Feb 23, 2024: Cordlife receives a letter from SAC Capital sent on behalf of substantial shareholder Nanjing Xinjiekou Department Store, stating it is mulling making an offer for shares of Cordlife it does not already own. Cordlife elects not to disclose the letter, as there is no strict requirement under the listing rules to do so if there has been no unusual trading in the company’s shares at the relevant time.

Feb 27, 2024: Cordlife guides for a 25 to 30 per cent slide in net profit for the financial year ended Dec 31, 2023. It adds that the impact could be greater if findings of the ongoing investigations confirm that more tanks were adversely affected by the temperature breaches. 

Feb 29, 2024: Cordlife director Joseph Wong steps down from his role as chair, but remains an independent director. Vice-chair and co-founder Dr Ho Choon Hou is appointed acting chairman. 

Cordlife’s board reaffirms Yiu’s appointment as group CEO, but notes that two directors – Chen Xiaoling and Zhai Lingyun – have expressed reservations on his appointment and abstained from the vote. 

Cordlife posts a net profit decline of 50.3 per cent year on year to S$1.5 million for H2 FY2023. Its full-year net profit falls 24 per cent to S$3.7 million.

The group announces the set-up of a new subsidiary in Vietnam.

Mar 14, 2024: Cordlife calls for a trading halt pending an announcement, after its shares fall 6.3 per cent or S$0.15 to S$0.225. 

Mar 21, 2024: Amid a trading halt, Cordlife says it has received separate extraordinary general meeting (EGM) requisition notices from two substantial shareholders – Nanjing Xinjiekou and TransGlobal Real Estate Group – calling for the removal of certain directors. 

Mar 22, 2024: Cordlife discloses that four directors and former group CEO Tan have been arrested by the Commercial Affairs Department (CAD) and released on bail. CAD has also asked chief financial officer (CFO) Thet Hnin Yi to assist in investigations, and has issued a notice for four other directors to attend an interview on Apr 2.

In the evening after the announcement, Cordlife posts a letter to shareholders from group CEO Yiu, affirming that the company is working with experts to introduce “stringent measures” to enhance operational standards. It is also focusing on a rectification plan to have the six-month suspension lifted.

Cordlife receives a second letter from SAC Capital, confirming that Nanjing Xinjiekou is reviewing its shareholding in the cord-blood bank, but has not expressed a firm intention to make an offer.

Mar 24, 2024: Cordlife says it will table the resolutions proposed by Nanjing Xinjiekou, but not those proposed by TransGlobal Real Estate Group, as the latter is not a “member” of Cordlife as defined by the Companies Act. Cordlife discloses the two requisition notices, as well as the two letters from SAC Capital.

Mar 27, 2024: Cordlife announces that CFO Thet has been arrested and released on bail by CAD, but maintains that she should remain at her post “in the interests of the company”.

Cordlife also disclosed that it had received another requisition notice calling for the removal of certain directors. The notice was issued by Phillip Securities acting as a nominee or custodian for Haitong International Securities for TransGlobal Real Estate Group as its underlying client.

April to May 2024: MOH conducts further inspections on Cordlife.

Apr 1, 2024: Cordlife requests a trading halt pending an announcement. Its shares last traded at S$0.172.

Apr 4, 2024: Cordlife says it will table two of TransGlobal Real Estate Group’s three proposed resolutions at the next general meeting, with conditions. It will also be extending its trading halt.

Apr 5, 2024: Cordlife announces that non-independent, non-executive director Yiu Ming Yiu has been arrested by CAD and released on bail. Chen and Zhai’s CAD interviews have been postponed to May 21, while former chair Wong has informed CAD he could not attend the Apr 2 interview for health reasons. The company says the implicated directors will continue to serve on its board, and the appointment of new independent directors will be contingent on how investigations evolve.

April 2024: Cordlife lodges police report; directors tussle over share placement

Apr 8, 2024: Cordlife finds that 5,300 cord-blood units stored in one of the six tested tanks and one dry shipper are at high-risk of being impacted by the temperature excursions. It is offering annual fee refunds and waivers of subsequent fees for customers whose cord-blood units are stored in this tank and dry shipper.

While preliminary testing has shown that the other five tanks – which contain around 13,700 cord-blood units – are considered low-risk, Cordlife will send over 200 samples from these tanks for tests, which could take up to a year to complete.

Apr 9, 2024: The company’s shares resume trading.

Apr 11, 2024: Cordlife says it is seeking a two-week extension from Singapore Exchange Securities Trading (SGX-ST) and the Accounting and Corporate Regulatory Authority (Acra) for the deadlines to hold its FY2023 annual general meeting (AGM), file its annual return and submit its sustainability report.

Apr 15 and 16, 2024: Cordlife says SGX-ST and Acra have granted the applications for an extension of time. The company confirms it will hold its AGM by May 14.

Apr 17, 2024: Cordlife proposes to raise S$8.2 million from a private placement of 51.2 million new ordinary shares at S$0.16 a piece. The company says it has entered into two separate subscription agreements with Charming Global Enterprises and Darren Ng.

Apr 18, 2024: Cordlife announces it has filed a police report against some former employees, after uncovering “preliminary evidence of potential wrongdoings” in connection to the Tank A incident. Two of its directors – Zhai and Chen – were not involved in the police report.

Apr 19, 2024: Cordlife calls for a trading halt after its shares sink to an all-time low.

Apr 22, 2024: Cordlife says Nanjing Xinjiekou and its nominated directors Zhai and Chen have filed an injunction application before Singapore’s High Court to restrain the company from issuing new shares. After issuing the announcement, the company lifted its trading halt.

Apr 24, 2024: Cordlife says it has received a letter from SAC Capital on behalf of Nanjing Xinjiekou, stating the substantial shareholder is still considering whether to make an offer for all Cordlife shares that it does not own.

Apr 25, 2024: KPMG, Cordlife’s independent auditor, will not be seeking reappointment after issuing a disclaimer of opinion on the financial statements for FY2023.

KPMG said in its disclaimer that it had not been able to obtain “sufficient appropriate audit evidence” to provide a basis for an audit opinion on several areas, including compliance with laws and regulations.

The company also flagged material differences between the audited and unaudited financial statements for FY2023.

May 2, 2024: Cordlife says it received a letter of demand from one of its clients alleging the cord-blood bank has breached its service agreement, as well as a breach of the duty of care in negligence.

It also received a notice of claim lodged against the company in the Small Claims Tribunals in February, alleging the damage to the cord-blood unit belonging to the child of another client.

May 2024: Shareholders oust three directors in FY2023 AGM

May 6, 2024: Cordlife responded to queries from Singapore Exchange regarding its upcoming AGM. Its directors gave different takes on who would oversee the company’s developments if resolutions to oust several board members pass at the AGM.

May 7, 2024: Cordlife says it has begun hiring more specialists to lead its laboratory teams and commenced extensive staff training as part of a major strategic overhaul. It added that a “significant” number of affected clients have accepted Cordlife’s offer of a refund of annual fees from the year of the temperature excursion.

May 8, 2024: Senior Minister of State for Health Janil Puthucheary says in Parliament that there are “limits” to how much the government can intervene in the issue of compensation and refunds requested by Cordlife’s customers, as MOH is not a party to the contracts signed by customers.

Meanwhile, Nanjing Xinjiekou attempts to convene a May 23 EGM to vote on its requisitioned resolutions. Cordlife says it is seeking legal advice on this.

May 9, 2024: Nanjing Xinjiekou posts an open letter to shareholders, seeking their support to pass its requisitioned resolutions.

May 10, 2024: Cordlife separately responds to further queries from the Singapore Exchange and from shareholders. Its directors laid out different plans to address the cord-blood bank’s troubles following the upcoming AGM. It also gave reasons for its proposed private placement among the replies to shareholders.

Cordlife’s application to set aside the interim injunction filed by Nanjing Xinjiekou is dismissed by Singapore’s High Court.

May 13, 2024: Cordlife says it will cancel the private placement as the injunction was upheld by the courts. It adds that it received a notice from MOH emphasising the importance of local directors on the board.

TransGlobal issues an open letter to shareholders urging them to reject Nanjing Xinjiekou’s resolutions.

May 14, 2024: Cordlife holds its FY2023 AGM. Over 60 per cent of shareholders whose shares were represented vote to remove three directors, including co-founder Dr Ho, from its board, and elect three directors proposed by Nanjing Xinjiekou.

May 19, 2024: Another of its directors, Chen, has been arrested by the CAD and released on bail, says Cordlife. She will continue to serve on the board, as she will be “overseeing and providing guidance on the ongoing work undertaken by the company to investigate and address the lapses identified by MOH”.

May 28, 2024: MOH bars Cordlife from collecting new cord blood and human tissue for up to an additional three months starting Jun 15, after conducting further inspections in April and May 2024.

June to August 2024: Further suspension

Jun 11, 2024: Cordlife reports a net loss of S$11.6 million for the first quarter ended Mar 31, reversing a net profit of S$1.2 million in the corresponding quarter the year before.

Jun 15: Cordlife’s suspension for a further three months begins.

Jul 25, 2024: Cordlife says its Hong Kong and Malaysian subsidiaries received re-accreditations from the Association for the Advancement of Blood & Biotherapies. On the same day, Zhai attends an interview with CAD.

Jul 29, 2024: Cordlife discloses that Zhai attended the CAD interview and was arrested in connection with investigations before being released on bail. 

Aug 5, 2024: Global Cord Blood Corporation’s joint liquidators have disposed of more than 25.5 million shares, or 10 per cent interest, in Cordlife. Global Cord Blood Corporation is linked to Sanpower Group Corporation, the owner of Nanjing Xinjiekou.

Aug 15, 2024: Cordlife posts a loss of S$12.4 million for the first half ended Jun 30. It also announces that it has lost its accreditation with the Association for the Advancement of Blood & Biotherapies.

Aug 26, 2024: Cordlife says Nanjing Xinjiekou has called off plans to buy the remaining shares it does not own in the cord-blood bank.

September 2024: Getting back on its feet – Cordlife resumes collecting new cord-blood in “controlled manner”

Aug 29, 2024: MOH issues a notice to Cordlife that it can resume cord-blood banking services with restrictions from Sep 15 to Jan 13, 2025.

Sep 6, 2024: Cordlife says it has accepted MOH’s notice.

Sep 9, 2024: Cordlife says its group director for quality and operations, Tan Huiying, has resigned to “pursue her personal interests”. Her last day will be Nov 4.

Sep 15, 2024: Cordlife resumes cord-blood banking services in “a controlled manner”. It starts receiving sign ups from new customers.

Sep 17, 2024: Cordlife announces upgrades to its laboratory monitoring system at its processing and storage facility, as well as its improved operational protocol.

Oct 29, 2024: Cordlife announces a Nov 14 EGM to appoint a new audit firm and approve directors’ fees.

Nov 10, 2024: Ahead of the EGM, Cordlife says its directors are committed to waiving their fees for FY2024 and defends its choice of auditor.

Nov 15, 2024: Cordlife sinks into the red and reports a S$1.6 million net loss for the third quarter.

Jan 8, 2025: Cordlife appoints Zhai as its new chairman, after Teo Tong Kooi stepped down from the position. Teo will remain on the board as an independent director.

Jan 14, 2025: Cordlife requests a trading halt before the market opens. At night, it announces that its operation licences have been renewed for one year, with immediate effect. The trading halt is lifted after the news.

Jan 15, 2025: In response to queries, MOH says it will monitor Cordlife’s governance and ensure its practices are consistent and compliant with regulatory requirements. Cordlife’s shares closed the day up 9.7 per cent or S$0.014 at S$0.159.

Feb 12, 2025: Cordlife’s group CEO, Yiu, tenders his resignation “to pursue other opportunities”. His effective date of cessation is Feb 28, 2025. The group searches for a new CEO.

July 2025: A planned midpoint audit is conducted by MOH. It finds that Cordlife has sustained its improved temperature-monitoring practices and has kept an accurate inventory of its cord-blood units. However, the company failed to maintain compliance in several key areas, including improper storage, managerial oversight and unvalidated equipment.

Sep 26, 2025: Testing results for five tanks previously assessed as “low-risk” following temperature warming events in 2023 are released. Only samples from two tanks have met the criteria for viability and potency. Cordlife’s root-cause analysis is unable to identify a conclusive reason for the other three failed samples.

Sep 29, 2025: Cordlife requests a trading halt before the market opens. MOH issues a notice of intent for Cordlife Group to face a one-year suspension over cord-blood banking service lapses. The company is given 14 days to submit its representations.