Ipca Lab shares fall 8% as USFDA bars its drugs in America
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Mumbai: Shares of Ipca Laboratories Ltd declined 15% on Friday as the US drug regulator barred entry of the company’s products in the US market because of non-compliance with manufacturing norms at its three facilities.
The stock fell to an intraday low of Rs437, a level last seen on 24 June 2016. So far this year, the company’s shares have fallen 17%.
The scrip closed at Rs471.70, lower by 8.08% against the previous session’s closing on BSE.
In stock exchange filings on Thursday, Ipca Lab said it has received communication from the US Food and Drug Administration (USFDA) that all drugs manufactured at facilities in Ratlam, Indore SEZ and Silvassa will be refused admission in the US until the company can demonstrate that products from these sites are in compliance with prescribed norms.
The company’s active pharmaceutical ingredients (API) plant at Ratlam and formulations units at Indore SEZ and Silvassa have been under import alert of the US FDA since 2015 for violation of good manufacturing practices but a few products were exempted from the ban to avoid shortages in the US market.
As per the company’s filing on Thursday, now only one API product, chloroquine phosphate manufactured at Ratlam facility, is exempted from the import ban.
“The exception (for chloroquine phosphate) will be reconsidered (by the USFDA) if shortage and/or medical necessity implications change,” Ipca Lab said in the filing.
It seems the USFDA has lifted exemptions of few other products of Ipca as they might no longer be in short supply because other companies that are compliant with norms are able to provide those drugs. But this is just an assumption, there is no clarity yet on this move by FDA, said an analyst, who did not wish to be named.
According to a report of Anand Rathi Share and Stock Brokers Ltd dated 31 May, Ipca Lab’s management has requested a one-on-one meeting with the USFDA to discuss the remediation work done at its plants, after which it would invite the regulator to re-inspect the two formulations units.
The API plant at Ratlam is likely to be offered for re-audit in August-September this year.