Cipla Stock Dips 7% as USFDA Issues Warning Letter Over GMP Inspection Issues

23 Nov 2023 , 01:26 PM

Cipla stock sees nearly a 7% decline on November 23 following CNBC-TV18’s report on the warning letter issued to its Madhya Pradesh unit by the USFDA. The warning letter, received on November 18, pertains to routine GMP inspection at Cipla’s Pithampur facility conducted on February 6 and 7, 2023.

According to CNBC-TV18, the warning letter highlights data integrity issues at Cipla, including product complaints and microbial contamination.

The USFDA had previously made similar and repeated observations for Cipla’s Goa facility, which is currently under ‘Official Action Indicated’ status, affecting product approvals for the US market.

The USFDA reportedly advised Cipla to seek assistance from third-party consultants to address the identified issues. Cipla’s management, after announcing Q2 results, mentioned that the USFDA observations on Pithampur and Goa facilities were causing a six-month delay in product launches.

The company is in the process of shifting the manufacturing of affected products to other plants. In the September quarter, Cipla reported a 43.3% YoY increase in consolidated net profit, reaching Rs 1,131 crore, and achieved its highest-ever revenue from the US at $229 million.

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