Cipla shares fall after company discloses six observations by USFDA at Patalganga facility
Upstox
2 min read • Updated: April 5, 2024, 11:47 AM
Summary
In August 2023, the same facility received suspension order of FDA license from the Office of the Joint Commissioner (Konkan Division), Food and Drugs Administration
Cipla has received six inspectional observations in Form 483 from the U.S. Food and Drug Administration (USFDA) following a routine current Good Manufacturing Practices (cGMP) inspection at its manufacturing facility in Patalganga, Maharashtra, the company said in an exchange filing.
The firm said it will work closely with the USFDA and is committed to address these comprehensively within the stipulated time. Shares of Cipla were trading 0.42% lower during the Friday morning session. The stock has gained nearly 16% since the beginning of the year.
This is not the first time the Patalganga unit has been in the news. In August 2023, Cipla had notified the stock exchanges that it received an order from the Office of the Joint Commissioner (Konkan Division), Food and Drugs Administration for suspension of FDA license issued to the company’s manufacturing unit located at Patalganga (Unit-II) for a period of 10 days in December 2023 for non-conformance of good manufacturing practices under Drugs and Cosmetics Act, 1940.
During the third quarter, Cipla had reported a 31.8% year-over-year rise in its net profit at ₹1,056 crore. The company witnessed a 13.7% rise in operating income at ₹6,604 crore while earnings before interest, tax, depreciation and amortisation (EBITDA) grew 24.2% at ₹1,748 crore during the quarter.
Cipla’s One-India business saw its revenue grow 12% supported by growth across branded prescription, trade generics and consumer health. Its North America business recorded the highest ever quarter at $230 million witnessing an 18% year-over-year growth supported by continuing momentum in key assets and robust demand in base business along with some year-end buying.
The company’s South Africa business posted a 15% y-o-y increase in revenue in local currency terms. This performance was supported by positive traction in prescription, over the counter (OTC) and tender, it said. Cipla had reported a net cash position of ₹7,143 crore during the quarter.