In a conference call yesterday discussing Hospira’s Q3 results, CEO Michael Ball said “by the end of this year the bulk of the remediation will be done,” reiterating his comments from September’s Morgan Stanley Global healthcare Conference, but conceded Hospira is: “going to continue to move forward with other remediation within the plant, as we move through 2014.”
For the quarter, Hospira reported net sales of $1bn (€740m), up 1.4% on the same period last year, with operating income at $29.8m, an improvement on last year’s Q3 loss of $16.5m.
New Quality Lab & Remediation
Remediation at the plant has included management changes, the addition of key quality and operational talent and efforts to modernize the facility, he said, along with the unveiling of a new onsite quality and analytical testing laboratory late last month.
The laboratory is part of a $200m investment in the site and will be responsible for evaluating and testing more than 450 different products.
Such efforts have not gone unnoticed by the FDA which Hospira met with during the quarter. Ball described the meeting as “positive and constructive” and the firm received a written response in the last few days confirming Rocky Mount “had made significant progress.”
Ball said: “There still is more work to be done, as they pointed out, and we have a 483 to prove it from last February. So they will be reviewing the results of our remediation at an upcoming inspection.”
Following shutdown, Rocky Mount was operating at less than 70 percent capacity but as remediation continues Ball told stakeholder the majority of the volume increases have occurred and any additional production increases would be more incremental.
“It continues on its upward trajectory,” he said. “It is bumpy, but from our standpoint, as we go into the fourth quarter, we feel we are nearing a top end situation.”
Ball spoke of an increased vigilance in overseas inspections in light of one of Hospira’s manufacturing sites - in Irungattukottai, India - also issued with an FDA warning in May this year.
“We have certainly implemented the types of remediation programs there that were successful in our U.S. plants,” Ball said.
Furthermore, he continued, experience from the FDA’s dealings with Rocky Mount would put Hospira in good stead for the opening of a new facility in Vizag, India which is set to have commercially sellable product by the end of next year.