Indoco Remedies shares fall over US FDA 483

Company, however, maintains that plant continues to supply products to US market

Shares of Indoco Remedies fell sharply by 20% on Friday after a letter issued by the US Food and Drug Administration (US FDA) to the company’s Goa plant in August 2013, highlighting concerns in its manufacturing practices, came into circulation.

The observations in the letter or FDA Form 483, which is issued to a company by US FDA authorities highlighting deviations found during their inspection, included lack of written procedures and process controls in the plant, lack of records for cleaning of equipment, absence of training for employees etc, sources said.

Indoco Remedies, however, maintained that it has satisfactorily responded to the FDA’s letter and the plant continues to supply products to the US market. Infact, the company claims to have filed fresh generic drug applications after the inspection.

“It is a old letter which we received on August 30, 2013 . We responded to the letter on September 16th with a detailed plan of action for taking corrective measures. Again on October 23rd and November 25th, we had sent all the updated compliance document to the US FDA. Since then, there is no warning letter or any other communication from the regulator,” Indoco Remedies Joint Managing Director Sandeep Bambolkar told Business Standard on phone.

Bambolkar added the company continues to supply four products from its Goa facility to the US and applications seeking approval for at least three new generic products from the same plant have been filed with the US FDA after the inspection was conducted in August last year. The plant currently contributes 18-20 crore to the company’s annual turnover.

On Friday, shares of Indoco Remedies closed at Rs 110.70 on Bombay Stock Exchange, down 19.9% from their previous close.

Domestic pharmaceutical companies have recently come into the spotlight for increasing enforcements by international regulatory agencies. Major drug makers such as Ranbaxy, Wockhardt, RPG Life Sciences and Agila Specialities were among various others that came under the US FDA scanner during 2013.

Following violations of manufacturing norms, various factories were also barred from supplying medicines to the US, which is the largest pharmaceutical market and a major revenue contributor for Indian companies. Most domestic pharma companies clock 50-60% of their consolidated sales from their exports to the US.