 "Dr Reddy's says in the process of formalising action plan")
Dr Reddy's Laboratories said the company is in the process of responding to the warning letter issued on November 5 by the US Food and Drug Administration (USFDA) over quality control issues and other violations at three of its manufacturing facilities.
The US drug regulator has asked the company to respond within 15 working days of receipt of its letter of the specific steps that the company has taken to correct the situation, as well as how it plans to prevent repeating the deviations and violations cited.
However, if the company cannot complete the corrective actions within 15 working days, it can state the reasons for the delay and by when it can do so.
"We take all observations raised by the USFDA, including this one very seriously and are in the process of responding to them. Until this is complete, we would not like to comment further," a spokesperson for Dr Reddy's said.
When asked if the company has responded to the letter, the spokesperson said they are in the process of doing so.
On whether the company has identified or short-listed any agency for doing the third party audit of the facilities, a step considered by Dr Reddy's senior management, the spokesperson said the process was underway.
"We will go in for a third-party assessment which will be more comprehensive compared to earlier assessments carried out. At this juncture our focus is on responding to the warning letter and addressing the concerns raised by USFDA and formalising an action plan," the company said.
Among other things, the letter, which is now in the public domain, has also cited the presence of a testing lab whose existence had not been revealed to the US drug regulator.
Dr Reddy's stock was down 6.69% at Rs 3,168 over the previous day's close during Friday afternoon trade on Bombay Stock Exchange.
"..These issues, given quality issues, will take time to get resolved. However, we have already pruned the numbers for worst case scenario coming from these plants," Sarabjit Kour Nangra of Angel Broking stated while maintaining the BUY rating with a price target of Rs 3,933.
