Biocon tanks after subsidiary vows correction action at Malaysia facility

Biocon shares were under pressure on Wednesday, October 18, after the biopharmaceuticals company said the US Food and Drug Administration (FDA) directed a unit of its subsidiary, Biocon Biologics, to conduct certain changes at its manufacturing facility in Johor, Malaysia, where the US drug regulator conducted a good manufacturing practices inspection in July. The Biocon stock dropped by as much as Rs 12.2, or 4.8 per cent, to Rs 242.2 apiece on BSE.  

At 11:20 am, Biocon shares were down 4.48 per cent at Rs 243 apiece on BSE. The stock closed 6.21 per cent lower at Rs 238.55 apiece.

The company said the classification of the facility of Biocon Sdn Bhd, a step-down subsidiary of Biocon Biologics, as “official action indicated (OAI)” may cause “delay and/or withholding of pending product approvals or supplements”.

The FDA places its regulatory or administrative action under the OAI category.  

Biocon Biologics said it had submitted a comprehensive corrective and preventive action (CAPA) plan with the FDA in response to observations from the July inspection and was on track to complete all actions as committed.

“The Company will continue to engage with the Agency to understand any outstanding concerns and work closely to address them expeditiously. We do not believe that this will have a material impact on the manufacturing and distribution of the Company’s commercial products for the US market. Biocon Biologics remains committed to bringing high-quality and affordable medicines to patients in the United States,” the company spokesperson said.

Biocon is scheduled to announce its financial results for the September quarter (Q2FY24) on November 10, 2023.  

Here’s how the Bengaluru-based biopharmaceutical company fared in the June quarter 

Biocon reported a decline of 30 per cent in net profit to Rs 101 crore for the first quarter of the financial year. Its quarterly revenue grew 60 per cent to Rs 3,422.6 crore, according to a regulatory filing. 

Biocon share price: Historical performance 

In 2023 so far, Biocon shares lost more than seven per cent of their value, sharply underperforming a rise of nearly nine per cent in the headline Nifty index.  

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