Exposure to US market causing constant FDA scrutiny for big drug firms

Dr Reddy's was in the news for falling short of expectations during routine audits conducted by the US drug regulator

Exposure to the US market and constant product filings are among the reasons why bigger Indian pharma players are more in regulatory glare than their smaller peers, according to analysts.

The shortfalls or deviations being noted by the US Food and Drug Administration (US FDA) inspectors during the inspection of manufacturing facilities are often causing a slowing down in terms of new filings or new launches impacting the revenues of these companies.

Dr Reddy's Laboratories Limited was the first Indian pharma player to secure the FDA approval for a manufacturing plant in the late eighties when the company set out to export APIs to the US.

Despite having decades of experience and wisdom gained in dealing with the regulatory compliance issues with regards to maintaining high manufacturing standards at its facilities, Dr Reddy's was in the news for falling short of the expectations during the routine audits conducted by the US drug regulator in the recent times.

Aurobindo Pharma was another Hyderabad-based drug major, which started facing similar regulatory issues across half a dozen of its facilities since January 2019, including a warning letter for one of the units in Srikakulam in June. 

"Large companies would be categorised as the most important ones in terms of their exposure to the US market and they get more focus from the US drug regulator accordingly. Also, these large companies have moved up the value chain with injectables and derma products, instead of just oral solids in the past. There the scope for finding gaps in the manufacturing practices is also high, owing to the complexities involved in the manufacturing of those products," a senior pharma analyst told Business Standard on condition of anonymity. 

A common pattern in the issuance of Form 483s or Official Action Indicated(OAI) by the US FDA was noticed across big and small companies in recent times was with regards to the manufacturing of sartans involving the alleged carcinogenic impurities found in the product.

Just as the number of product filings by a company would necessitate more frequent plant audits by the US drug regulator, the heightened manufacturing activity involving more number of products at a manufacturing would also give a possible scope to issues despite the best efforts and systems put in by the company, according to a senior management official of Aurobindo Pharma.

"You can completely rule out the possibility of receiving a Form 483 only when you are not doing anything. In our case, we will be filing for so many product approvals and when they come to review these filings they may observe something that our people might not have noticed. How you respond to these observations is important from the regulatory perspective" the official said asking not to name for the story.

These days big pharma players like Aurobindo and Dr Reddy's have been filing for new product approvals from multiple sites so that even if one facility gets critical conclusions during the inspections requiring further remediation, the manufacturing and export of the product will be carried out from another site that has no compliance issues. 

"As long as there are no data integrity issues in the manufacturing of a product it is fine. Any other observations that are usually issued by way of Form 483, are not a matter of big concern as these issues are addressable and do not lead to import restrictions," a senior official of Dr Reddy's maintained.

After it had got a warning letter for three of its manufacturing facilities in November 2015, Dr Reddy's management had undertaken a complete overhaul of quality standards and practices across all the manufacturing plants using the expertise of third party consultants.

The  Aurobindo official said that his company had implemented electronic systems for the documentation of all the manufacturing processes across the facilities to have a better oversight on the operations. "The team of US FDA inspectors, who had recently visited Unit 5 had found these systems very helpful in completing the audit of our relatively big units in a short time," the official said.

The companies falling short of expectations of the US drug regulator in maintaining quality standards and practices at their plants is interpreted as a work in progress requiring a cultural change. The companies also do not rule out the human factor behind some of these deviations such as lack of proper monitoring, people not adhering to the protocols, a problem that runs across the companies big and small.