Glenmark Pharma falls 3% as Baddi unit gets 7 observations from USFDA

The stock dipped 3% to Rs 574 on the BSE in intra-day trade.

Glenmark Pharmaceuticals dipped 3% to Rs 574 on the BSE in intra-day trade after the company said its Baddi unit gets seven observations from US health regulator.

“The US Food and Drug Administration (USFDA) issued seven observations through the form 483,” Glenmark Pharmaceuticals said in a regulatory filing.

The Baddi unit of Glenmark Pharmaceuticals underwent an US FDA audit from November 6, 2017 to November 11, 2017. The Baddi unit contributes approximately 10% of the revenue of US sales.

“We are in the midst of providing a comprehensive response to the observations and would be replying to the FDA shortly on the observations,” the company said.

Since November 2, post September quarter (Q2FY18) results, the stock of Glenmark Pharma was under pressure, falling 13% and hit a 52-week low of Rs 565 on November 16, 2017 in intra-day trade.

The company reported a 4.2% year-on-year (YoY) drop in Q2FY18 consolidated net profit to Rs 214 crore on weak US sales. Consolidated revenue grew 1.5% YoY to Rs 2,257 crore during the quarter. In US, the biggest market for the company, sales fell 5.7% on year to Rs 727 crore because of the persisting price erosion in older products.