The Ministry of Food and Drug Safety has also prohibited 22 South Korean pharmaceutical firms from selling 59 products that contain valsartan made by Daebong LS.
The move came as some of the valsartan made by Daebong LS has been confirmed to have N-nitrosodimethylamine (NDMA) levels above 0.3 ppm.
NDMA is classified as a probable human carcinogen by the World Health Organization's International Agency for Research on Cancer.
Daebong LS makes the active ingredient valsartan after importing crude valsartan from China's Zhuhai Rundu Mintong Pharmaceutical.
Shares in Daebong LS fell 13.38 percent to 7,830 won (US$7), underperforming the broader KOSPI's 0.05 percent loss. From the Yonhap.