The United States Food and Drug Administration (USFDA) has on October 31 issued a warning letter to Caraco Pharmaceutical Laboratories, the US subsidiary of Sun Pharmaceuticals Ltd, withholding all future marketing approvals for medicines manufactured from Caraco’s production facility in Detroit.
The US regulator’s action comes in the wake of certain technical inadequacies identified by the FDA during an inspection carried out in May 2008.
In a statement issued to American Stock Exchange on Monday, Caraco said the USFDA observations include, among other things, the inadequate and untimely investigation by the quality control unit of certain incidents at the facility contrary to the company's standard operating procedures.
The FDA considered some of its observations to be repeat observations and hence the warning letter, the statement said.
“Caraco intends to respond promptly and timely to the FDA within fifteen business days. The Company is committed to working cooperatively and expeditiously with the FDA to resolve the matters indicated in its letter.
Caraco is confident that any remaining concerns will be addressed and resolved”, it said.
Following the disclosure, Caraco share prices dropped 4.13% on Amex on November 3rd. The Sun pharma is amongst the biggest losers on BSE today, with its shares plunging 9.79% or Rs 108.25 on BSE at 12.45 pm.
According to Sun spokesperson, the USFDA move will not have a major impact on its US revenues as all its products, currently marketed in the country will continue to be sold in the US. “Of the pending marketing approvals from US FDA only 19 products are from Caraco.
Sun has 96 such applications pending before FDA and all other products are to be sourced from our other manufacturing facilities in the US and India”, Sun spokesperson said.
Among Indian companies Sun pharma has maximum exposure to the US market with over 40 per cent of its revenues coming from medicine sales in the US.
The company said that its major revenue earners like protonics and ethyol will not be impacted by the FDA inquiry.