Drug firm Strides Shasun today said it is evaluating claims made by US-based Mylan, to which it sold Agila Specialties for USD 1.75 billion in 2013, over compliance with USFDA manufacturing norms.
The company has received notification of claims from Mylan in relation to certain provisions contained in the SPAs (sale and purchase agreements) and in relation to certain regulatory concerns, Strides Shasun said in a BSE filing.
While it did not disclose the date of receipt of the claims from Mylan, Strides Shasun said: "The company believes it can successfully defend these claims and is in the process of evaluating each claim notified by Mylan.
In August this year, USFDA had issued a warning letter to Mylan Laboratories for violation of current good manufacturing practice (CGMP) norms at its three plants in Karnataka.
The US regulator said its inspectors found "significant violations" in the three manufacturing facilities in Bengaluru of the company, which is an arm of US-based Mylan Inc.
Of the three units, two plants belonged to Agila Specialties, which Mylan had acquired from Strides Arcolab in 2013-end. The other unit is owned by Mylan Laboratories.
In the BSE filing, Strides Shasun further said: "In any event, the company is confident that ultimate claims will be within the escrowed amounts and will not result in unforeseen liabilities."
As part of the transaction for sale of Agila, the company had "deposited USD 100 million in an escrow in respect of potential claims on warranties and indemnities and has also deposited a further USD 100 million into an escrow in respect to potential claims under the SPAs in relation to certain regulatory concerns".
The company also said "there is no new occurrence of which any notice has been received from Mylan in relation to US Food and Drug Administration."
Strides had completed the sale of its Agila Specialties division to Mylan Inc for a total consideration of up to USD 1.75 billion in December 2013.
