Caraco’s Detroit plant gets quality warning

By Gareth Macdonald

- Last updated on GMT

Related tags Food and drug administration

Caraco Pharmaceutical Laboratories, in which India’s Sun Pharmaceuticals holds a 76 per cent stake, has joined the list of generics manufacturers issued with an FDA warning on quality control issues.

The warning letter, which was sent on October 31, blocks the approval of any pending abbreviated new drug applications (ANDAs) submitted by Caraco. The document relates to a US Food and Drug Administration (FDA) inspection of the firm’s facility in Detroit in May.

The following month, the FDA issued Caraco with a Form 483 detailing a list of quality observations that it needed to address. While the firm said that it had moved to correct all the shortcomings within 15 days, the FDA’s latest warning lists several “repeat observations” suggesting that Caraco still has work to do.

Although the October 31 letter has not been published in full, Caraco’s November 3 Form 8-K filing with the Securities and Exchange Commission (SEC) listed “the inadequate and untimely investigation by our quality control unit of certain incidents​” among the problems that the agency considers are unresolved.

Earlier this year Caraco faced its first manufacturing setback when it was forced to withdraw several batches of its version of the generic diabetes drug metformin after it emerged that some of the tablets did not meet with approved specifications.

In an interview with India’s Business Standard, ​a​Sun Pharmaceuticals spokesperson claimed that the FDA’s latest warning would not have a major impact on its US revenues, explaining that only 19 of its 96 pending ANDAs had been filed by Caraco.

However, given the difficulties already encountered, coupled with the fact that US generic sales represent about 40 per cent of its annual turnover, Sun is likely to seek a quick resolution in an effort to maintain Caraco’s position in the country’s booming non-branded drug market.

Caraco’s share price fell 68 cents, or 6.7 per cent, to $9.49 in morning trading on the New York Stock Exchange on the day of the announcement.

Busy year for FDA’s generics inspectors

So far this year the FDA has issued a number of non-branded drugmakers with warning letters related to manufacturing practices, most notably: Baxter; Ethex; Sandoz; Actavis Totowa; and, in India, Ranbaxy.

Ironically given the FDA’s latest warning, Caraco was listed as one of the two firms, in addition to GlaxoSmithKline (GSK), that would take up the slack in digoxin supply following the Actavis recall.

As the number of branded products going off patent increases over the next few years, the amount of companies supplying generics to the US, the world’s largest drug market, is likely to grow considerably.

Such growth will add to the pressure on the FDA to ramp-up its inspection programme which, given the number of warnings that it currently issues generics firms, may well result in a much greater number of reprimands.

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