Sun Pharma smacked by FDA warning letter for leaky ceiling, contamination risks

The FDA indicated in a warning letter this week that Sun Pharmaceutical has some gaps in its manufacturing processes at its Halol plant, as well as leaks in the ceiling, that put its drugs at risk for contamination.

Sun warned investors this weekend that it had received a warning letter from the FDA for its plant in Halol, a facility that is key to the drugs it manufactures for the U.S. It said it had been working for a year to make improvements to the facility, bringing in outside consultants and investing in equipment and training. But the letter, posted Tuesday by the FDA, said that Sun's four different responses lack "sufficient corrective actions." The regulator has asked India's largest drugmaker to do more to assure its injected drugs are free of contamination.

Some of the issues outlined by the FDA were similar to those that have tripped up other Indian drugmakers in the past couple of years. Controls were lacking on some computerized equipment that would ensure unauthorized employees were not getting into them and changing test results. Sun had not done sufficient airflow studies to prevent microbiological contamination in manufacturing areas and did not thoroughly investigate the cause of some out-of-specification test results for products being shipped to the U.S.

Some of the issues were more specific. During the plant inspection in September 2014, inspectors discovered buckets catching leaking rainwater in the plant's manufacturing area.

Sun Pharma Managing Director Dilip Shanghvi

Sun Managing Director Dilip Shanghvi assured investors in a statement Saturday that the company has been working and communicating with the FDA since the agency cited the plant last year. He said Sun "will continue to cooperate with the U.S. FDA and undertake any additional steps necessary to ensure that the US Agency is completely satisfied with our remediation of the Halol facility," a plant that accounts for about 15% of Sun's U.S. sales.

Meanwhile, the remediation has undermined Sun's efforts to grow since buying Ranbaxy Laboratories earlier this year in a $4 billion deal that propelled it into the number 5 spot globally among generics makers. It had to shift production of its approved generic of Novartis' ($NVS) top-selling drug, cancer pill Gleevec, to another facility so that it can meet a Feb. 1, 2016, launch date. The restrictions on the Halol site also tripped up its effort to move into new drug development. Sun Pharma Advanced Research Company won its first FDA drug approval in March for epilepsy drug Elepsia XR, only to have it withdrawn 6 months later because of the lingering issues at Halol.

- read the warning letter

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