GRI Bio Reports Positive Study Results For Chronic Lung Disease, But Stock Slumps 20% — What Happened?

• The latest findings include RNA-sequencing data showing that GRI-0621 significantly modulated genes associated with lung injury.
• Prior Phase 2a results had already shown favorable safety and tolerability, as well as reduced disease progression.
• Stocktwits users speculated that short selling could be the reason behind the stock’s decline.

GRI Bio, Inc. (GRI), on Wednesday, announced encouraging new results from its Phase 2a study of GRI-0621 in patients with Idiopathic Pulmonary Fibrosis (IPF), a chronic and progressive lung disease.

The latest findings include RNA-sequencing data showing that GRI-0621 significantly modulated genes associated with lung injury, myofibroblast activation, extracellular matrix deposition, fibrosis progression, and alveolar repair compared with placebo.

Treatment May Support Lung Tissue Regeneration

Crucially, the new data indicate that GRI-0621 may support the regeneration of lung tissue, including the repair of the alveolar basement membrane and the transition of AT2 (Alveolar Type) epithelial cells to AT1, which are key steps in restoring lung function.

Prior Phase 2a results had already shown favorable safety and tolerability, reduced disease progression, and improvements in exploratory endpoints, such as forced vital capacity, with twice as many treated patients maintaining lung function compared with standard care.

“The data from the Phase 2a study exceed our expectations. The totality of data generated in this Phase 2a study suggests that GRI-0621 may represent a fundamentally different approach, with the potential to alter the trajectory of disease by promoting repair of damaged lung tissue,” said Marc Hertz, chief executive officer of GRI Bio.

Short Selling Speculation

However, despite the seemingly positive development, GRI shares fell 20%. But users remained bullish, despite what many speculated as short selling.

Despite the sharp intra-day decline, retail sentiment on Stocktwits flipped to ‘extremely bullish’ from ‘bearish’ a day earlier. GRI was also among the top trending tickers on the platform.

Reverse Split

Last week, GRI Bio announced a 1-for-28 reverse stock split to regain compliance with the minimum bid price requirement for continued listing on the Nasdaq Capital Market.

The action became effective after-market hours on January 23, 2026, while trading on an ex-reverse split basis began on Monday. The split reduced outstanding shares from about 15 million to 536,000. 

Read also: SBUX Stock Jumps 7% Today – US Transactions Grow For The First Time In Two Years

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