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Sun Pharma Gets FDA Import Warning for India Plant, Shares Drop

PTI

Last Updated: December 08, 2022, 18:13 IST

Bengaluru, India

Sun Pharmaceutical Industries Ltd

Sun Pharmaceutical Industries Ltd

Shares of Sun Pharma slid 3.6% on their worst day since May 28, 2021, and were the top loser on the blue-chip Nifty 50 index.

Sun Pharmaceutical Industries Ltd’s drug shipments from its Gujarat plant could be refused entry in its key U.S. market after the drug regulator slapped an import alert on the facility, the drugmaker said on Thursday.

The Food and Drug Administration’s (FDA) import alert implies all future shipments of products made at the plant in Halol, Gujarat could be refused admission to the U.S. market until the facility becomes compliant with the regulator’s Current Good Manufacturing Practice standards.

“The company continues to cooperate with the U.S. FDA and will undertake all necessary steps to resolve these issues and to ensure that the regulator is completely satisfied with the company’s remedial action," Sun Pharma said.

Shares of Sun Pharma slid 3.6% on their worst day since May 28, 2021, and were the top loser on the blue-chip Nifty 50 index.

The drug maker is not revising its revenue forecast for this fiscal year due to the FDA action, it said in a separate filing after market close.

The FDA has excluded 14 products from the import alert, subject to conditions, which Sun Pharma said were confidential.

It was not immediately clear what remedial action the FDA had asked the company to take. Sun Pharma did not immediately respond to Reuters’ request for further comment. The company also said it was evaluating whether it would incur any additional costs for remediation.

“Import alerts are very tough to remove, and several companies are still not able to get their facilities back in compliance after 7-10 years," said Shrikant Akolkar of Asian Markets Securities. The house cut Sun Pharma’s revenue and earnings outlook, and lowered target price by 4.5% to 1,156 rupees.

The focus would now move to Sun’s Mohali facility, Akolkar added. The plant was classified as “official action indicated" after an inspection in November, which means the FDA would recommend regulatory or administrative actions.

The Halol plant had received the same inspection classification in August after the FDA made 10 observations.

Transferring products made at Halol to other sites would be a complex and time-consuming process, so product transfers would be evaluated on a case-to-case basis, Sun said.

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(This story has not been edited by News18 staff and is published from a syndicated news agency feed)
first published:December 08, 2022, 18:13 IST
last updated:December 08, 2022, 18:13 IST
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