Cipla rebounds after drug maker seeks to allay investors’ concerns on its Pithampur facility

Cipla share price BSE, Cipla USFDA news: Cipla shares began Friday’s session on a strong note after the Mumbai-based drug maker said it was in the process of submitting requisite response to a warning letter from the US Food and Drug Administration (FDA) for its Pithampur manufacturing facility. The Cipla stock gained by as much as Rs 33.4, or 2.9 per cent, to Rs 1,202 apiece in morning deals on BSE. The drug maker also said it would work closely with the US drug regulator to address the concerns.  

Cipla said there was no new development requiring additional disclosure on the matter. The sharp fall in Cipla shares on Thursday was triggered by concerns about whether the warning letter will impact the company’s existing products, according to analysts.  

Cipla received the warning letter, dated November 17, on November 18 in continuation of observations received in Form 483 about its Pithampur plant on February 17, and received the inspection classification of the said facility as Official Action Indicated (OAI) on August 5.

Both the communications from the FDA were intimated to the stock exchanges within 24 hours of receipt, Cipla said.

The US regulator had conducted inspection at the pharma company’s Pithampur facility from February 6 to February 17. The FDA issues Form 483 after completing an inspection in case it observes conditions that are in violation of its regulations. The regulator classifies an inspection as OAI in cases where it recommends corrective action.  

“We once again confirm that we do not see material risk to our existing commercial product portfolio,” the pharmaceutical company said.

“The Company is in the process of executing de-risking plan for its new products and simultaneously addressing the observations expeditiously… We also submit that we uphold quality and compliance with utmost importance and remain committed to be compliant with the current good manufacturing practices) cGMP quality standards,” Cipla added.

EDITOR'S TAKE | Here’s what market wizard Anil Singhvi suggests investors do with Cipla shares 

Zee Business Managing Editor Anil Singhvi suggests investing in Cipla futures in the range of Rs 1,120-1,145, and expects a higher range in the counter to emerge at Rs 1,210 and Rs 1,215 levels for the day. 

Should you buy, sell or hold Cipla shares? Here's what brokerages suggest 

• JP Morgan maintained an ‘overweight’ rating on Cipla with a target of Rs 1,230.  
• HSBC retained its ‘buy’ call on the pharma stock but reduced its target to Rs 1,425 from Rs 1,440. 

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