For the second quarter 2013, Hospira’s operating costs dropped 6% to $974m (€734m) whilst operating income jumped to $52.2m, from a loss of $2.2m on the same period last year.
The results were deemed “good” by Hospira CEO, F. Michael Ball, who told stakeholders in yesterday’s conference call the firm was “on the road to recovery” following several years of manufacturing woes in both Hospira’s pharma and device divisions, culminating in a string of 483s and Warning Letters from the US Food and Drug Administration (FDA).
“On the pharma side of the house, we are making good progress and starting to see more of the roadblocks in our rearview mirror,” he said, citing an inspection during the quarter at the Clayton, North Carolina, facility - temporarily closed last year following a Warning Letter - that found no observations.
Further evidence of Hospira’s remediation plan and quality initiative was demonstrated with improvements at the troubled Rocky Mount, NC facility which, according to Ball, continues to make good progress:
“Our release levels are improving, our backlog levels have declined and our customer service levels are increasing. One of our automated visual inspection lines is up and running and our new lab will be operational over the next few months.”
Rocky Mount was subject to the same Warning Letter as Clayton and at one point last year the site was running at less than 70% capacity. Performance in the US is “very difficult to achieve without Rocky Mount executing very well,” Ball said, and remediation efforts have contributed to the quarter’s results.
Another 483 for Boulder and Warning in India
The period was not all positive for Hospira. Though unpublished so far by either the firm or the FDA, Ball said:“Early in the quarter, the agency inspected our Boulder API facility, which resulted in a 483 with 2 observations.”
The facility in Colorado had previously been sent a 483 for failing to complete validation of procedures for cleaning equipment after an inspection in 2011.
The quarter also saw a Warning Letter issued to the company’s IKKT sterile product facility in Irungattukottai, India, after an inspection last year uncovered a number of GMP violations including unsanitary conditions during the filling of an injection.
“We have submitted our action plans addressing the comments,” said Ball, adding:“For IKKT, the FDA recently sent us a letter that they agree with our proposed corrective actions and that the actions should adequately address the violations at issue if implemented appropriately.”
Though Hospira is moving forward there is still more work to be done, Ball said, and currently “the devices trail the pharma remediation by approximately 6 months to 1 year.”
A Warning Letter this quarter, following an inspection in January at the Lake Forest, Illinois medical device plant demonstrated this and could add to Hospira's woes in the next few months, according to Ball
The site had an audit from the National Standards Authority of Ireland (NSAI) who cited three major nonconformities on top of other issues at the plant. On the back of this audit, suspension of ISO certifications on products from both the plant and Hospira’s Costa Rica sites may be imminent, Ball said.
This would also negate the CE Mark certification and “could potentially impact sales of our infusion pumps and related consumables in many countries outside the US.”