Wockhardt faces fresh strictures from UK drug regulator

Indian generic drugs maker Wockhardt's troubles with Britain's health regulator continue, as the UK Medicines and Healthcare Products Regulatory Agency (MHRA) restricted exports from the pharma firm's factory in Kadaiya, Daman, the company said on Tuesday.

This the company's third plant, after Waluj and Chikalthana near Aurangabad, Maharashtra, to face restrictions, within a space of a few months, as foreign regulators continue to target Indian pharma

The UK market contributes approximately £3 million or 20 per cent to the firm's consolidated revenue.

The MHRA has cancelled Wockhardt's "good manufacturing practices" certificate for the Kadaiya plant for noncompliance with its manufacturing standards, and will now issue a restricted GMP certificate to allow the factory to test, make and supply to Britain certain drugs critical to public health, a statement to the stock exchanges said.

''In order to avoid market shortage of medically essential products, the GMP certificate will be conditioned to permit continued manufacturing and QC (quality control) testing of 'critical' products in situations where it has been agreed by the national competent authority or EMA (as appropriate) that there is no feasible alternative in the concerned market,'' the company said in its statement.

''The scope of the statement of non-compliance is therefore limited to medicinal products considered non-critical to public health.

The fresh blow comes days after the MHRA recalled five drugs made by Wockhardt from a plant in Chikalthana in Maharashtra (See: Wockhardt recalls 5 drugs in UK after regulatory strictures).

In recent months both the US and UK watchdogs issued import alerts on drugs made at another Wockhardt manufacturing unit in Waluj, Maharashtra, citing quality concerns.

The firm's shares fell 4.29 per cent to Rs458.2 rupees after Tuesday's setback, and Wockhardt said the impact of the fresh export curbs "will only be known once it receives further communication from MHRA".

Wockhardt's Kadaiya plant manufactures tablets for Europe (not exported to the US). ''The impact on the existing business will only be known once the company receives further communication from UK MHRA,''Wockhardt said.

Around 60-65 per cent of its revenue comes from the Chikalthana unit, which is under FDA scanner now. Earlier, in July this year, UKMHRA had imposed an import alert on Wockhardt's export-oriented plant at Waluj in Maharashtra and issued a precautionary recall of 16 medicines made by the company at the unit, after the US Food and Drug Administration (FDA) had issued a similar import alert in May on the same facility.

Wockhardt had at that time said it had already initiated several corrective actions to resolve the issues at the Waluj plant. The company said it does not manufacture any product for the US market at the said facility.

The Waluj facility makes injectables and solid dosages.

Wockhardt, which recently restructured its debt to set its house in order, is among a string of drug companies to face action from international regulators in recent times.

Wockhardt owns 14 manufacturing facilities across India, the US and Europe that are US FDA, UK MHRA and EMEA-compliant. In India, it has manufacturing facilities at Waluj, Chikalthana and Shendra (Aurangabad), Bhimpore and Kadaiya (Daman) and Ankleshwar and Baddi (Himachal Pradesh).

The Waluj and Chikalthana plants are major suppliers to the US and UK markets.

Its Bhimpore plant supplies tablets and capsules to the UK while the one at Baddi sells liquids and suspensions to the US. Its export-oriented unit for injectibles in Aurangabad had in April been served with Form 483 by the US FDA for violation of US rules.

US FDA had, last month, blacklisted Ranbaxy Laboratories' Mohali plant. Several facilities of Ranbaxy, including Dewas, Paonta Sahib and Mohali, are under US FDA scanner now.

Earlier this year, the company had also pleaded guilty in the US of fraudulent activities and agreed to pay a penalty of $500 million to US authorities.

Between January 2010 and June 2013 about 66 companies, including Ranbaxy, Novartis, Sanofi Aventis, Merck KGaA and Wyeth, had received warning letters from US FDA.

About 12 per cent of these were Indian companies, which account for 40 per cent of drug master files (for selling drug ingredients) and 37 per cent of abbreviated new drug applications (for selling formulations).

Industry experts, however, say these regulatory moves are not targeted specifically at Indian companies. They say Indian drug companies get affected for failure to adopt progressively higher standards of safety and quality.