IPCA Labs drops nearly 3% after USFDA concludes inspection of Madhya Pradesh unit with 11 observations

Pharmaceutical company IPCA Laboratories announced on Wednesday that its Ratlam manufacturing facility has been issued 11 observations by the inspection team of the United States Food and Drug Administration (USFDA), sending its shares down by around 3 per cent. At closing shares of Ipca Laboratories were down 2.43 per cent at Rs 717 a share.

The company informed the bourses that the USFDA issued a Form 483 with 11 observations after the completion of the inspection of its API manufacturing facility located in Ratlam, Madhya Pradesh.

The inspection of the Ratlam facility was conducted from June 5 to June 13, 2023.

The company will submit its comprehensive response to these observations to the US drug regulator within the stipulated time and shall work closely with the agency to resolve these issues at the earliest, IPCA Labs stated in an exchange filing.

It mentioned that the company takes quality and compliance issues with utmost importance and remains committed to maintaining the highest standards of quality and compliance across all its manufacturing facilities.

The Ratlam facility of IPCA Labs has been under an import alert since FY15, resulting in a halt in its supplies to the United States.

Brokerage Motilal Oswal mentioned in a report last month that Ipca's in-house manufacturing of active pharmaceutical ingredients (API) for most of its approved abbreviated new drug applications (ANDAs) makes regulatory compliance at the Ratlam facility pivotal for any recovery in the US generics business.

Three of Ipca Labs' facilities at Ratlam, Silvassa, and Pithampur, remain under import alert.

The USFDA had issued three observations in Form 483 following the inspection of IPCA Labs’ formulation facility in Silvassa in April 2023.

IPCA shares were trading lower by 2.02 per cent at Rs 720 apiece on BSE at 10.37 AM.