Aurobindo Pharma gets warning letter from USFDA for Andhra facility
22/06/2019
Hyderabad: Aurobindo Pharma has received a warning letter dated June 20, 2019, from the US Food and Drug Administration(USFDA) relating to Unit XI, the active pharmaceutical ingredient (API) unit at Pydibhimavaram in north coastal Andhra's Srikakulam district.
The latest warning letter comes as a major setback. Last month, the company's two other API and formulation facilities had also received Form 483 with critical observations, which the company said would have no bearing on its business.
Aurobindo said in a filing that the warning letter was issued by USFDA after a site inspection of Unit XI in February 2019. The warning letter imposes an export ban on products involving the API unit until all the issues are resolved to the satisfaction of the regulators through remedial measures.
The company said that the latest USFDA action will not have any impact on its existing business. "We believe the existing business from this facility will not be impacted. We will be engaging with the regulator and are fully committed in resolving this issue at the earliest. The company is also committed to maintaining the highest quality manufacturing standards at all of its facilities across the globe," Aurobindo Pharma said.
Agreeing with the company's assessment, senior HDFC Securities analyst Amey Chalke said the development would not have any material impact as there were very few product approvals pending from this facility and the company would be able to shift the existing products to other manufacturing sites over a period of next six months.
However, Chalke said that it could take some time to convince the USFDA with the necessary corrective measures to withdraw the warning letter. "Though the USFDA decision will not have a material impact, it will certainly have a sentimental impact as people may fear the company would get similar regulatory actions pertaining to the other sites where the inspection outcomes are pending," he observed.
Aurobindo Pharma's share price fell as much as 7.7 per cent to Rs 578.75 in the wake of warning letter before recovering around 2 per cent price over the previous close of Rs 626.90 during the morning trade.
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