Indian pharma cos with bigger US presence face more FDA scrutiny: Analysts

Topics Pharma sector | Pharma | Dr Reddy's

Dr Reddy’s Laboratories was the first Indian pharma player to secure FDA approval for a US factory, in the late 1980s
Higher exposure to the American market and their constant product filings are among reasons why the bigger Indian pharmaceutical companies are in constant regulatory focus compared to smaller peers, say analysts.

The shortfall or deviations noted by inspectors of the US sector regulator, the Food and Drugs Administration (FDA), at manufacturing facilities in Hyderabad have often caused a slowing of new drug filings or launches in that market.’

Dr Reddy’s Laboratories was the first Indian pharma player to secure FDA approval for a US factory, in the late 1980s, when it set out to export Active Pharmaceutical Ingredients (APIs) there. Yet, after all the decades of experience gained in dealing with  regulatory compliance issues at its Indian facilities, Dr Reddy's remains in the news for being pulled up during routine FDA audits.

Aurobindo Pharma, another Hyderabad-based drug major, has faced similar regulatory issues at half a dozen of its facilities since early this year, including a warning letter for one at Srikakulam (Andhra) in June. 

“Large companies would be categorised as the most important ones in terms of exposure to the US market and, accordingly, get more focus from the US drug regulator. Also, these large companies have moved up the value chain with products like injectables and derma products, in the place of only oral solids in the past.  The scope for finding gaps in manufacturing practices is also high, owing to the complexities involved in the manufacturing processes of those products,” a senior sector analyst told Business Standard, on condition of anonymity. 

A common pattern in the issuance of Form 483s or Official Action Indicated (OAI) by the FDA during recent times, across big and small companies, is on the manufacturing of what are called sartans, involving alleged carcinogenic impurities in the product. Just as higher numbers of product filings would necessitate more frequent plant audits by the FDA, heightened manufacturing activity involving more products would also give scope for such issues, despite the best effort, according to a senior management official at Aurobindo Pharma.

“You can completely rule out the possibility of receiving a Form 483 only when you are not doing anything. In our case, we will be filing for so many product approvals and, when they come to review these filings, they might observe something that our people might not have noticed. How you respond to these observations is important from the regulatory perspective,” the official said, asking not to be named. 

Big entities such as Aurobindo and Dr Reddy’s have been currently filing for new product approvals from multiple sites. The idea is that if any of these is the subject of critical conclusions during inspections, requiring remediation, the product's manufacturing and export could be done from another site that has no compliance issues. 

“As long as there are no data integrity issues in making a product, it is fine. Any other observations that are usually issued by way of Form 483 are not a matter of big concern, as these are addressable and do not lead to import restrictions,” said a  senior official at Dr Reddy’s. After it got a warning letter for three of its units in November 2015, Dr Reddy’s management did a complete overhaul of quality standards and practices across all its plants, hiring consultants from elsewhere.

 The Aurobindo official says his company has implemented electronic systems for documentation of all manufacturing processes across facilities, for better oversight on operations. “The team of FDA inspectors which recently visited Unit 5 had found these systems very helpful in completing the audit of our relatively big units in a short time,” he said.




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