Mumbai: Biocon Ltd’s shares jumped over 7% after the company said on Monday that its manufacturing facility in Bengaluru, which had received observations relating to lapses in quality compliance earlier this year, has been cleared by the US Food and Drug Administration (FDA).
“The US FDA has issued an Establishment Inspection Report (EIR) in relation to the cGMP (current Good Manufacturing Practice) inspection of its aseptic drug product facility that was audited between 25 May and 3 June 2017. The FDA has classified the outcome of this inspection as VAI (voluntary action indicated) and the EIR states that the inspection is closed," the company said in a stock exchange filing on Monday.
This development is positive for the company as it has filed applications for key biosimilars such as trastuzumab and pegfilgrastim with the US regulator from this manufacturing facility. Final marketing approval for these drugs can be held back if the facility is not cleared.
Shares of Biocon closed 7.27% up at Rs423 on the BSE, while benchmark Sensex index closed 0.05% higher at 33,359.90 points.
Following the inspection that ended on 3 June, the US FDA had issued Form 483 to the facility with 10 observations of violations of GMP norms.
The FDA issues a Form 483 to a company’s manufacturing unit if its investigators spot any condition that in their judgement may constitute a violation of the US Food Drug and Cosmetic (FD&C) Act and related acts.
“The receipt of EIR means Biocon can get product approvals filed from the unit. This is a positive development as it paves way for the company’s biosimilars to take off in the US. Now we have to watch out for next action from European regulator, which will be a big trigger for the stock," Afzaal Mohammed, manager – fundamental research, Karvy Stock Broking, said.
In March, Biocon’s drug substance and drug product sites in Bengaluru were inspected by French National Agency for Medicines and Health Products Safety on behalf of the European Medicines Agency (EMA).
While the French regulator issued GMP certificates to the company’s two drug substance manufacturing units, it found quality lapses in the drug product unit.
On 7 November, Biocon said its partner Mylan NV has resubmitted marketing authorisation applications for biosimilars trastuzumab and pegfilgrastim with EMA that were withdrawn in August due to quality compliance issues observed by the French regulator at Biocon’s plant.
The company will get GMP compliance certificate for the drug product facility only after a follow-up inspection by EMA to verify the implementation of the corrective and preventive actions for the plant. Until the facility is cleared, Biocon will not get marketing approval for its biosimilars in Europe.