‘Ostracized and criticized’ Indian CRO hits US FDA with $50m lawsuit

By Dan Stanton contact

- Last updated on GMT

GettyImages/NiroDesign
GettyImages/NiroDesign

Related tags: United states, Food and drug administration

Semler Research Center says the US FDA caused the “complete annihilation” of its business after regulators rejected bioanalytical studies on the back of data integrity concerns.

In April 2016, the US Food and Drug Administration (FDA) issued Semler Research Center (SRC) an ‘Untitled Letter’​ stating evidence it had found of data manipulation in a number of bioanalytical studies during an inspection of its facility in Bangalore, India in September and October 2015.

The Agency then sent a notice​ to drug sponsors that bioavailability/bioequivalence (BA/BE) studies conducted by the contract research organisation (CRO) would need to be repeated.

$50m lawsuit

But last week Semler filed a lawsuit against the FDA, the United States Department Of Health And Human Services (HHS) and the United States Of America – along with various individuals – for total damages of approximately $50m (€40m).

The firm claims the FDA’s actions were in violation of the Fifth Amendment, interfered with economic advantages and intentionally inflicted financial distress on the company.

They left Semler with a stigma leading to “the complete annihilation of SRC’s business and its exposure to monetary claims from its customers,” ​the firm said in its complaint logged with the United States District Court Central District of California.

Benefiting US CROs?

Among the accusations, Semler said the respondents “failed to conduct a proper and reasonable investigation under the circumstances to avoid making baseless and unsupported conclusions regarding SRC’s Clinical and BA/BE studies,” ​and failed to conduct its investigation “in a reasonable and prudent manner.”

The plaintiff claims the defendants did this with the “intent of eliminating SRC from the marketplace to the benefit of other CROs,”​ especially those based in the US and those based in India “with whom FDA Inspectors had personal relationship with the owners or employees.”

“SRC was publicly ostracized, criticized, and identified as being a company who engaged in misconduct and violations of federal regulations, had data integrity concerns, and from whom FDA would not accept any Clinical or BA/BE studies, which result caused SRC to suffer severe and permanent injury including, without limitation, lost earnings, and other injuries and damages.”

Semler did not respond to comment requests from this publication.

EMA recommendations

In its Untitled Letter and subsequent communications, the FDA reiterated similar concerns highlighted in a Notice of Concern (NOC) also issued in April 2016 to Semler by the World Health Organisation (WHO)​​.

The WHO said at the time it was “of the impression that to execute this type of manipulation several staff members on various levels within the organisation have to be collaborating and coordinating.”

On the FDA and WHO’s findings, the European Medicines Agency (EMA) recommended​ the suspension of a number of products​​ that relied solely on bioequivalence studies conducted by Semler at the facility, including products developed by Novartis’s Sandoz and Teva​.

This also was criticised by Semler: “The EMA never conducted any inspection but only relied on FDA’s claims and April 19, 2016 letter to conclude adversely to Plaintiff.

“On the basis of the conclusions of WHO, EMA, and the FDA, several other countries’ governing bodies regarding pharmaceutical testing, such as the Ministry of Health of Malaysia and the customers of SRC are rejecting the studies conducted by SRC and demanding compensation from SRC.

“These companies include, without limitation, Lupin Limited, Microlabs Limited, Dr. Reddy’s Limited, and Inventia Healthcare Pvt Ltd.”

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