Tony Munroe and Sumeet Chatterjee
By Tony Munroe and Sumeet Chatterjee
US inspectors visiting a factory in India owned by drugmaker Wockhardt Ltd in March found torn data records in a waste heap and urinals that emptied into an open drain in a bathroom six metres from the entrance to a sterile manufacturing area.
And when an inspector asked about the contents of unlabelled vials in the laboratory glassware washing area, a plant worker dumped them down a sink and said the contents could not be determined, according to a July 18 letter from the US Food and Drug Administration to Wockhardt, which makes sterile injectable drugs and various forms of insulin. Habil Khorakiwala, chairman of Wockhardt, last week told shareholders that the problem at its Waluj plant “is an inexcusable lapse, but we have taken swift and definitive action, both corrective and pre-emptive,” including appointment of a new quality chief and hiring of outside consultants.
India’s drugmakers, battered by a rash of US regulatory rebukes including a record fine for Ranbaxy Laboratories Ltd, face closer FDA scrutiny as the agency ramps up its presence in the country. Increased on-the-ground oversight reflects India’s growing importance as a supplier to the United States, and should ultimately bolster quality and confidence in Indian-made drugs.
In March, India allowed the FDA, guardian of the world’s most important pharmaceuticals market, to add seven inspectors, which will bring its staff in India to 19. India produces nearly 40 percent of generic drugs and over-the-counter products and 10 percent of finished dosages in the United States. The FDA’s stepped-up presence should also accelerate what some in the domestic industry hope is a more rigorous attitude towards compliance in a country whose cheap generics have made it the low-cost pharmacy to the world. In the near term, it means Indian drugmakers could be more frequently hit by enforcement measures or inquiries, unnerving investors.
Shares of Ranbaxy, controlled by Japan’s Daiichi Sankyo Co, fell as much as 42 percent in the months after it pleaded guilty in May to US felony charges related to drug safety and agreed to $500m in fines. The urgency to be first with a generic version of a drug coming off patent is the main reason for quality problems, Sharma said. The company that first launches such a drug enjoys a 180-day exclusivity period, which can be lucrative for the generic version of a commercial blockbuster.
Wockhardt’s once-soaring shares fell as much as 79 percent in the months after the announcement of an “import alert” banning shipments from the Waluj factory in May. By the middle of this week, the stock was down nearly 59 percent. The FDA’s power cuts both ways. Last week, IPCA Laboratories shares gained 7.6 percent on the day it said the FDA had cleared its oral solid formulations plant in Indore for US shipments. In November, IPCA had voluntarily reported “non-conformances” at the plant to the FDA.
India is the biggest overseas source of medicines to the United States and is home to over 150 FDA-approved plants, including facilities run by global players. Pharmaceutical exports from India to the United States rose nearly 32 percent last year to $4.23bn. As US demand for generics grows, especially under President Barack Obama’s healthcare programme, the FDA is under pressure to clear product applications while ensuring quality. Many in India note that drugmakers globally, including in the United States and Europe, have also run afoul of increasingly stringent FDA inspection.
REUTERS
By Tony Munroe and Sumeet Chatterjee
US inspectors visiting a factory in India owned by drugmaker Wockhardt Ltd in March found torn data records in a waste heap and urinals that emptied into an open drain in a bathroom six metres from the entrance to a sterile manufacturing area.
And when an inspector asked about the contents of unlabelled vials in the laboratory glassware washing area, a plant worker dumped them down a sink and said the contents could not be determined, according to a July 18 letter from the US Food and Drug Administration to Wockhardt, which makes sterile injectable drugs and various forms of insulin. Habil Khorakiwala, chairman of Wockhardt, last week told shareholders that the problem at its Waluj plant “is an inexcusable lapse, but we have taken swift and definitive action, both corrective and pre-emptive,” including appointment of a new quality chief and hiring of outside consultants.
India’s drugmakers, battered by a rash of US regulatory rebukes including a record fine for Ranbaxy Laboratories Ltd, face closer FDA scrutiny as the agency ramps up its presence in the country. Increased on-the-ground oversight reflects India’s growing importance as a supplier to the United States, and should ultimately bolster quality and confidence in Indian-made drugs.
In March, India allowed the FDA, guardian of the world’s most important pharmaceuticals market, to add seven inspectors, which will bring its staff in India to 19. India produces nearly 40 percent of generic drugs and over-the-counter products and 10 percent of finished dosages in the United States. The FDA’s stepped-up presence should also accelerate what some in the domestic industry hope is a more rigorous attitude towards compliance in a country whose cheap generics have made it the low-cost pharmacy to the world. In the near term, it means Indian drugmakers could be more frequently hit by enforcement measures or inquiries, unnerving investors.
Shares of Ranbaxy, controlled by Japan’s Daiichi Sankyo Co, fell as much as 42 percent in the months after it pleaded guilty in May to US felony charges related to drug safety and agreed to $500m in fines. The urgency to be first with a generic version of a drug coming off patent is the main reason for quality problems, Sharma said. The company that first launches such a drug enjoys a 180-day exclusivity period, which can be lucrative for the generic version of a commercial blockbuster.
Wockhardt’s once-soaring shares fell as much as 79 percent in the months after the announcement of an “import alert” banning shipments from the Waluj factory in May. By the middle of this week, the stock was down nearly 59 percent. The FDA’s power cuts both ways. Last week, IPCA Laboratories shares gained 7.6 percent on the day it said the FDA had cleared its oral solid formulations plant in Indore for US shipments. In November, IPCA had voluntarily reported “non-conformances” at the plant to the FDA.
India is the biggest overseas source of medicines to the United States and is home to over 150 FDA-approved plants, including facilities run by global players. Pharmaceutical exports from India to the United States rose nearly 32 percent last year to $4.23bn. As US demand for generics grows, especially under President Barack Obama’s healthcare programme, the FDA is under pressure to clear product applications while ensuring quality. Many in India note that drugmakers globally, including in the United States and Europe, have also run afoul of increasingly stringent FDA inspection.
REUTERS
