MDS Pharma closes Quebec facility following FDA probe

By Kirsty Barnes

- Last updated on GMT

Related tags Pharmacology Drug Fda

MDS pharma has ceased operations at its bioanalytical services
facility in Blainville, Quebec in a bid to boost profitability
after an ongoing investigation of the site by the US Food and Drug
Administration (FDA).

The restructure also affects the firm's other North American bioanalytical facilities - in St. Laurent, Montreal, which is also involved in the FDA probe, as well as its site in Lincoln, Nebraska.

From now on, the former Quebec operations will be carried out from the Montreal facility, which had extra capacity to absorb the added workload, MDS Pharma spokesperson Charlene McGrady told Outsourcing-Pharma.com.

Employees from both sites will fall foul of the axe, although the firm was unable to say how many jobs will be affected. Around 150 employees work at the two sites.

Meanwhile, MDS also completed a "small" restructuring in its Nebraska facility at the end of January, with the loss of 12 jobs.

Commenting on the consolidation, McGrady said that due to the "drop off in customer demand," combined with the cost of the FDA review, the firm is trying to improve its profitability.

Indeed, MDS' president and CEO, Stephen DeFalco recently told a JP Morgan healthcare conference in San Francisco that the company had already taken a hit of about CAD$31m (€20.5m) from the regulator's probe of its Canadian operations.

"We are now trying to keep our infrastructure costs in line with current demand,"​ said McGrady.

She could not say whether the firm had any plans for further consolidation, stating that "any future actions will be based on client demand."

The company has endured years of turmoil after FDA inspections of its two Canadian plants in 2003 found a range of problems with its pharmacokinetics testing procedures, including failure to identify and fix sources of contamination in tests, which measured drug levels in the blood of patients.

As a result, the FDA began a review in February 2005 of all the bioequivalence tests performed by the pharma services unit of MDS between 2000 and 2004, and in September last year, MDS voluntarily suspended its mass spectrometry services in order to undertake its own internal review.

To MDS' relief, the FDA has recently clarified a path for MDS' bioanalytical clients that will "provide a route for closure" to the agency's review.

As part of the final stages of the regulatory action, the FDA has given MDS' clients six months take one of the three following actions: repeat their bioequivalence studies, re-analyse their original study samples at a different bioanalytical facility, or independently audit original study results.

According to the FDA, more than 1,000 brand-name and generic drugs that have been approved or submitted for approval since 2000 may have included MDS data in their applications. While this will not result in the removal of any drugs from the market, it could delay approval of pending drug applications.

The FDA stressed that the retesting is only a precautionary measure and it also made it clear that it does not have any evidence that there are problems with the quality, purity, or potency of the affected drug products.

In a bid to limit the damage, MDS has decided to end its own retrospective review of the bioanalytical studies to focus on supporting its clients with the independent audits.

"We are taking proactive measures to help and support our clients in this, and are focusing a lot of our resources at the Montreal site on this,"​ said McGrady.

Meanwhile, McGrady also stressed that the regulatory action has been confined to its Canadian bioanalytical services operations, and affects none of its other divisions in Canada, Switzerland, the US or UK.

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