U.S. FDA Conducts Surprise Audit At Alkem Lab’s Daman Plant

The U. S. drug regulator is conducting a surprise audit at Alkem Laboratories Ltd.’s largest facility in Daman, Gujarat, two people aware of the development told BloombergQuint requesting anonymity.

The U. S. Food and Drug Administration officials began inspecting the site yesterday, which is expected to go on for another four to five days, the two people quoted above said. The officials are mainly auditing the quality control practices and production line of the Mumbai-based drug maker.

Emails sent to Alkem Labs remained unanswered, while the U.S. FDA said they cannot confirm, deny or comment on enforcement actions.

U.S. sales account for approximately 16 percent of the total sales for the company. The Daman unit contributes approximately 50 percent to its current U.S. sales, as per the company’s exchange filings.

The facility makes capsules, tablets, injectables, dry syrups, which are also exported to the U.S. The plant is also important for Alkem as 60-70 percent of the future filings or abbreviated new drug application are filed from this facility, according to an HSBC report.

The inspection comes at a time when Indian generic drugmakers’ margins are under pressure because of competition in the U.S., one of their largest markets.

Alkem had earlier received a Form 483 with 13 observations for the Daman plant in September 2016 but got an all clear by end of the year. The drugmaker has six U.S. FDA approved facilities — three for formulations and three in APIs – currently.