Sun Pharmaceutical's buyout of troubled Ranbaxy Laboratories this year came with the chore of facing the issues that led the FDA to ban four Ranbaxy plants in India. But now Sun finds itself cleaning up a mess from Ranbaxy's U.S. manufacturing operation, Ohm Laboratories, which has led it to recall more than 1 million boxes of a product it produced for private-label customers.
According to the most recent FDA Enforcement Report, Ohm is voluntarily recalling 1,050,607 boxes of loratadine, its generic version of hay fever drug Claritin, the branded version of which is Bayer's. The report shows that the North Brunswick, NJ, operation has issued 21 recalls of the drug for itself and about 20 customers that include chains like Walgreens ($WBA), Rite Aid ($RAD), CVS ($CVS) and Safeway ($SWY). The FDA says the drugs are out of spec and superpotent.
When it closed its $4 billion deal for Ranbaxy in March, Sun founder Dilip Shanghvi pledged to do what it took to get the four Ranbaxy Laboratories plants that the FDA had banned for data integrity and manufacturing shortcomings back into shape. Since then, though, it has also found itself dogged by FDA concerns over a Sun plant in Halol, India. In August, Sun blamed a 4% slide in U.S. sales in its last quarter, in large part, on "temporary supply constraints arising from remediation efforts at the Halol facility." The costs of remediation at Ranbaxy's plants were a drag on the company's bottom line.
The problems at the Halol plant led Sun to recall 35,235 bottles of its generic of the antidepressant Wellbutrin XL last month. The drugmaker said that the med failed dissolution testing at 18 months because its drug-release results were not on the mark at the 4-hour time point. Previously it recalled venlafaxine hydrochloride extended-release tablets, a generic of Pfizer's ($PFE) Effexor XR, as well as more than 128,000 bottles of the decongestant cetirizine, for dissolution problems.