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| Sun Pharma Managing Director Dilip Shanghvi |
Sun Pharmaceutical's $3.2 billion buyout offer for Ranbaxy Laboratories also came with a pledge to clean up the act of India's largest generic drugmaker, which has had four plants banned by the FDA. But Sun also recently had a plant nixed by the FDA, and Bloomberg learned it was for many of the same issues faced by Ranbaxy.
An inspection report, which Bloomberg snagged through a Freedom of Information request, showed sanitation issues at the Sun plant that included nasty bathrooms and a lab that appeared "uncleanable." But more importantly, employees at the Sun facility routinely disregarded batch failures and simply retested drugs rather than figuring out what was at issue. They would then delete from systems the tests that didn't meet specs.
The agency in March issued the import alert for Sun's plant in Karkhadi, prohibiting it from exporting to the U.S. the cephalosporin antibiotics or bulk ingredients. Sun told Bloomberg in an email that, "In this process, we have learnt and have resolved to work on further strengthening our systems and controls." It has also pointed out that the plant accounts for only about 1% of its revenues.
But it is the way Sun operates that may be more applicable to how it will overcome FDA regulatory issues that have cut four Ranbaxy plants off from the lucrative U.S. market. Sun's practice of discarding failed tests is almost exactly the same issue the FDA noted before it banned Ranbaxy's active pharmaceutical ingredient plant in Toansa in January.
That plant was the second Ranbaxy facility the FDA banned within the last year and the fourth of 5 FDA-approved plants the Indian drugmaker operates that have now been blocked. Issues with analytics were noted in some of those other actions as well. It seems to be an issue that is prevalent throughout the Indian industry because it was also noted in warning letters the FDA sent to two Wockhardt facilities that it also banned and has appeared as a problem in other regulatory actions against Indian facilities, including one operated by Germany's Fresenius Kabi.
Cleanliness also was a problem that the inspectors brought up throughout the Form 483, Bloomberg reported. They noted a strong aroma of urine in a quality-control lab area and bathrooms that they described as in "total disrepair." In one, they observed what appeared to be human waste on a wall. Manufacturing waste, old equipment and other garbage were noted in the "perimeter manufacturing areas" which inspectors said could attract pests. Inspectors had made similar observations at Ranbaxy's Toansa and Mohali plants, noting an analytics lab full of flies and toilets that lacked running water.
Sun told Bloomberg has implemented corrective measures on cleanliness at the plant. It said it has taken the "necessary disciplinary action" and replaced equipment tied to the testing failures. The drugmaker said some of the FDA's observations were related to the surrounding areas of the buildings, and it hasn't made a final decision on whether to shutter the facility.
When Sun announced its deal to buy Ranbaxy earlier this month, Sun's managing director, Dilip Shanghvi told Reuters that his top priority is fixing the problems at Ranbaxy's plants and getting them into FDA compliance. He also noted: "The quality of business at Ranbaxy is in no way inferior to business at Sun Pharmaceutical."
- read the Bloomberg story