Tablets are arranged for a photograph in Mumbai, India. (Photographer: Dhiraj Singh/Bloomberg)

Cloud Of Repeat Observations Hangs Over Dr. Reddy’s Duvvada Plant

Dr. Reddy’s Laboratories received eight observations, five of them a repeat of 2017 and warning letter of 2015, from the U.S. drug regulator at its Duvvada facility—crucial for future growth prospects in its largest market.

The observations were issued after an audit of the injectable plant starting Oct. 23. BloombergQuint has obtained a copy of the form 483 issued by the U.S. Food and Drug Administration to India’s fifth-largest pharma company by sales. To be sure, this is the third time the plant received observations from the U.S. FDA. Repeat observations or signs of persisting data integrity can escalate to an import alert.

The Duvvada plant is important for Dr. Reddy’s as nearly 20 percent of its future filings (abbreviated new drug applications) come from this facility. The drugmaker manufactures the generics of Dacogen and Vidaza at this site. Though the plant contributes less than 10 percent to the total sales, a large number of observations, including a repeat, will result in delays in getting new approvals.

Also read: All You Need To Know About Dr. Reddy’s Duvvada Plant’s Troubles

Looking Back: Duvvada Plant Woes

  • November 2015: U.S. FDA issues warning letter with three observations.
  • February 2017: FDA reinspects Duvvada plant.
  • March 2017: FDA issues Form 483 with 13 observations.
  • October 2018: FDA reinspects plant and issues Form 483 with eight observations.

Shares of Dr. Reddy’s snapped a two-day rally and fell as much as 2.1 percent to Rs 2,401.10 apiece. That compares with a 1.3 percent gain in the NSE Nifty Pharma Index.

Here are the eight observations:

  1. No written procedures for production and process controls designed to assure that the products have identity, strength, quality and purity they purport to possess.*
  2. Investigations of a failure of a batch or any of its components to meet any specifications did not extend to other batches of the same product that may have been associated with the specific failure or discrepancy.*
  3. Procedures designed to prevent microbiological contamination of drugs purporting to be sterile are not established or followed.**
  4. Aseptic processing areas are deficient regarding the system for monitoring environmental conditions.#
  5. There is a failure to thoroughly review any unexplained discrepancy whether or not the batch has already been distributed.*
  6. Employees engaged in manufacturing and processing of drugs lack training and experience to perform their assigned functions.
  7. The batch production and control records are deficient. They do not include identification of persons performing each significant step in the operation.
  8. Field alert report was not submitted within three working days of receipt of information concerning a failure of one or more distributed batches of a drug to meet specifications established for it in the application.

(*Repeat of warning letter and March Form 483; **repeat of warning letter; #repeat of March Form 483)

Also read: Dr. Reddy’s Earnings Indicate Tough Quarter Ahead For Indian Generics In U.S.

This may take minimum seven to eight months to comprehensively respond to the deficiencies in the plant, according to Amit Rajan, managing director of Prosfora Technologies, which specialises in good manufacturing practices for drugmakers.

“Observations 1, 3 and 4 are of major concern,” Rajan said. Observations 3 and 4 are related to inadequate media fill studies, the core of sterile manufacturing. Correcting the deficiencies mentioned and re-running the media fill studies will take about three months, he said, adding the observation 4 will need slight modifications in the facility which is a six-month process. “This means just responding to the deficiencies and assurance will not work.”

Dr. Reddy’s, in response to BloombergQuint’s emailed query, said the company is working to respond to all observations within the stipulated time.

Also read: Q2 Results: Dr. Reddy’s Profit Rises For Second Straight Quarter, Beats Estimates