Ipca Labs receives FDA warning letter for three plants; stock plunges 7%

“The US FDA inspected our manufacturing units situated at Ratlam (Madhya Pradesh), SEZ Indore (Pithampur), and Piparia (Silvassa); these manufacturing units received certain inspection observations in Form 483, subsequently resulting in issuance of import alert. We wish to inform you that US FDA has now issued a warning letter to these manufacturing units,” said the company in a statement.

The US Food & Drug Administration (US FDA) has issued a warning letter to Ipca Laboratories for not complying with the drug regulator’s quality standard at three of the companies manufacturing plants.  

“The US FDA inspected our manufacturing units situated at Ratlam (Madhya Pradesh), SEZ Indore (Pithampur), and Piparia (Silvassa); these manufacturing units received certain inspection observations in Form 483, which subsequently resulted in issuance of import alert. We wish to inform you that US FDA has now issued a warning letter to these manufacturing units,” said the company in a statement.

“We have voluntarily suspended shipments of APls and formulations for the US market until US FDA inspection observations are resolved. Therefore, since July 2014 the company has not shipped any APls or formulations to the US market, except products that are exempt from the import alert. The company has responded to the US FDA inspection observations and has initiated remedial measures and is also working with external consultants to ensure that the remedial measures are undertaken in a proper and timely manner,” added the company. 

The company is fully committed in resolving this issue at the earliest. It is also committed to its philosophy of highest quality in manufacturing, operations, systems integrity, and cGMP culture. 

Ipca Laboratories Ltd is currently trading at Rs. 621.9, down by Rs. 46.95 or 7.02% from its previous closing of Rs. 668.85 on the BSE.

The scrip opened at Rs. 664.5 and has touched a high and low of Rs. 667.5 and Rs. 560 respectively. So far 512264 (NSE+BSE) shares were traded on the counter. The current market cap of the company is Rs. 8440.89 crore.

The BSE group 'A' stock of face value Rs. 2 has touched a 52 week high of Rs. 888 on 19-Aug-2015 and a 52 week low of Rs. 591.25 on 09-Feb-2015. Last one week high and low of the scrip stood at Rs. 670.25 and Rs. 639 respectively.

The promoters holding in the company stood at 45.89%, while Institutions and Non-Institutions held 35.94% and 18.17% respectively.

The stock is currently trading above its 100 DMA.