Zai Lab (09688) shares plummeted 5.23% during Friday's intraday trading, reflecting investor concerns over the company's recent financial move. The significant drop comes as the biopharmaceutical company faces scrutiny over its capital position.

According to recent SEC filings, Zai Lab entered into a maximum amount guarantee contract on October 13, which guarantees RMB300 million (approximately $41.5 million) in working capital loans. This financial maneuver suggests that the company may be seeking additional liquidity to support its operations or upcoming projects.

The market's negative reaction to this news highlights investor wariness about Zai Lab's financial health. For biotechnology companies, which often require substantial capital for research and development, such moves can be interpreted as a sign of cash flow pressure or increased financial risk. Investors may be concerned about potential dilution if the company needs to raise more equity in the future, or about the overall impact on the company's balance sheet.