More than three years after snapping up Hospira, Pfizer has finally decided that some of its manufacturing facilities in India are beyond redemption.
The U.S. pharma will shut down its long-troubled injectables facility in Irungattukottai, India, as well as another site in Aurangabad, India, both of which were folded into Pfizer through the $15 billion acquisition of Hospira in 2015.
Between the two plants, 1,700 employees face potential cuts, but their fates are not yet clear despite an immediate halt to production there. In a statement shared with FiercePharma, Pfizer said its focus is on the employees and that it's “committed to keeping colleagues informed of the site exit process.”
Pfizer said the decision to exit the two sites came after a “thorough evaluation,” which concluded that it makes no sense to continue operations “due to the very significant long-term loss of product demand.” The sites “will immediately cease manufacturing with the intention to exit both sites as soon as possible in 2019,” the company said in a statement.
Closure of the Irungattukottai site didn’t come as a complete surprise. Having long suffered from manufacturing problems as noted by the FDA on several occasions, the site has been a thorn in Pfizer’s side since the Hospira deal wrapped up.
The deficiencies can be traced back to a warning letter in 2013, and the most recent slap from the agency came just half a year ago in the form of a 32-page, 11-observation Form 483. In that filing, the FDA cited problems with product testing, where workers were found to manipulate test samples to obtain passing results. The agency also criticized the plant for slow responses to customer complaints.
Before that citation prompted Pfizer to stop production, the Irungattukottai site was making beta-lactam antibiotics, while the Aurangabad plant was turning out penicillin and penem API, according to local newspaper Business Standard. Neither plants supply products for the domestic India market, according to Pfizer.
Irungattukottai is not the only legacy Hospira plant that’s been under constant FDA scrutiny. Most notably, problems at its plant in McPherson, Kansas, are the key reason behind some serious shortages for the U.S. healthcare system.
Just as Pfizer was making upgrades to its Kansas facility in response to an FDA warning letter, the main supplier of injectable opioid analgesics was once again slapped with a Form 483 in late 2018. What’s more frustrating, seven of the FDA's eight observations are repeats. As that Form 483 made headlines, Pfizer said the site “developed and implemented a robust corrective and preventive action plan.”
Ongoing manufacturing shortfalls have not only caused inconvenience for U.S. hospitals and patients but also taken a toll on Pfizer’s financial performance. In its third-quarter report released in October, Pfizer lowered the high end of its 2018 financial guidance and attributed that move in part to “lower-than-anticipated Essential Health revenues, primarily due to continued legacy Hospira sterile injectable product shortages in the U.S.”
Pfizer has previously promised its supply issues will be “significantly improved” by the end of 2019. Part of the remedy will be coming from a relatively new site Pfizer inherited from Hospira.
The company is expanding its operations at that site, in Vizag, India. Being built into a global “Terminally Sterilized Manufacturing Center of Excellence,” the site “will cater to export markets, such as United States, and eventually we expect to Canada,” Pfizer said. This means the New York pharma will still retain a strong presence in the country, with additional sites in Goa and a joint venture in Ahmedabad with Cadila Healthcare.